Hedge Fund Expansion Into Development Property
West Palm Beach (HedgeCo.net)- Hedge fund Three Arch Investors has begun buying tracts of abandoned development land in California.
“Property and land values in California have dropped to very low lows and at some stage they will recover." John Godden, managing partner of London-based IGS Group said, “This is the ultimate way to play what everyone knows to be the situation.”
"The price of homes have fallen by a little under 20% over the past year, and land prices have slumped by almost 80%." David Michelson, manager of the California Distressed Land Fund said. “The banks do not want this stuff, they want to get rid of it,” he said.
The fund, which has a target size of $150m to $250m, provides an alternative to commercial property funds or residential property index derivatives for those seeking to benefit from any upswing in the property sector.
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