Insights / 13 October 2021
Jersey fund sector figures reflect strong alternatives market conditions
Jersey Finance recently published the latest quarterly figures for its funds sector, with data showing that total funds business in the jurisdiction grew to new record highs at the midway point in 2021.
At the end of June 2021, the report noted that the total NAV of funds serviced in Jersey stood at £436.3bn – representing growth of 15% over the first half of the year, despite the ongoing challenges posed by the pandemic. That growth was fueled primarily by the alternative asset classes, an area where Jersey has significant expertise with almost 90% of its total funds business in the alternative space.
Also of note is the significant growth in private equity, which rose by 24% over the first half of 2021 to break through the £200bn barrier representing just shy of half of all funds business done in Jersey.
Commenting on the latest figures, Mark Collins, Director, Funds Services, said:
“The figures certainly mirror the market activity we’ve seen over the past year and indicate two key trends. First, that investors are on the front foot in the PE space and see the asset class as a key route for allocating capital, both to generate returns and also to play a part in economic efforts to ‘build back better’ – through investment in infrastructure and businesses for instance. Second, that there is strong demand for tried and tested PE platforms and expertise, and given Jersey’s proven track record it’s unsurprising that the jurisdiction is seeing this resulting growth at a time when PE is in such a buoyant place.”
“But this is a long-term trend too. Ten years ago, around £40bn of PE fund assets were administered in Jersey, and that figure has grown exponentially over the decade as institutional and increasingly private investors explore the opportunities offered by the asset class. It’s a growth trajectory we’ve seen mirrored at Crestbridge as investors continue to seek specialist expertise and support in the PE space.”
Meanwhile, real estate funds business has also demonstrated strong growth credentials, with the latest quarterly figures showing that total regulated real estate funds business in Jersey stands at £43.3bn, compared to £22.4bn in 2011 – growth of almost 100% over ten years.
Alex Le Quesne, Director of Crestbridge’s Real Estate Fund Services team added:
“The real estate fund landscape has certainly evolved over the past decade, but the figures for Jersey’s fund sector, together with our experience over the past year assisting clients launching new funds illustrate that there is still strong appetite to invest in the asset class. It remains a resilient asset with long-term appeal, and the demand continues for robust structures such as those in Jersey that can facilitate, support and service efficient, compliant cross-border investment.
“Against the backdrop of the pandemic, we fully expect the approach to commercial real estate investment to continue to evolve as investors reassess how remote working, logistics, ESG and wellbeing factors all integrate into real estate use. It promises to make the sector an exciting one for investment in the coming months as investors look at increasingly innovative solutions.”
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