The Middle East Becomes the World’s ATM
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    HOUSE MEDIAN ASKING PRICES AND WEEKLY CHANGE     Sydney $1,656,430 (+0.65%)       Melbourne $994,677 (+0.27%)       Brisbane $978,777 (+0.15%)       Adelaide $878,311 (-0.89%)       Perth $857,374 (-0.27%)       Hobart $742,122 (-0.64%)       Darwin $666,990 (-0.54%)       Canberra $987,062 (-0.84%)       National $1,052,287 (+0.12%)                UNIT MEDIAN ASKING PRICES AND WEEKLY CHANGE     Sydney $750,216 (+0.60%)       Melbourne $492,069 (-0.93%)       Brisbane $539,184 (+0.19%)       Adelaide $444,416 (-2.21%)       Perth $457,888 (+0.17%)       Hobart $527,154 (-0.12%)       Darwin $344,216 (+0.22%)       Canberra $504,424 (-0.33%)       National $530,515 (-0.07%)                HOUSES FOR SALE AND WEEKLY CHANGE     Sydney 10,120 (-121)       Melbourne 15,095 (-40)       Brisbane 7,990 (0)       Adelaide 2,438 (+11)       Perth 6,327 (-40)       Hobart 1,294 (-21)       Darwin 238 (+1)       Canberra 1,020 (+13)       National 44,522 (-197)                UNITS FOR SALE AND WEEKLY CHANGE     Sydney 8,780 (+4)       Melbourne 8,222 (-18)       Brisbane 1,619 (+1)       Adelaide 396 (-4)       Perth 1,599 (+9)       Hobart 213 (+10)       Darwin 400 (-6)       Canberra 1,003 (-24)       National 22,232 (-28)                HOUSE MEDIAN ASKING RENTS AND WEEKLY CHANGE     Sydney $820 (+$20)       Melbourne $610 (+$10)       Brisbane $640 (+$3)       Adelaide $610 (+$10)       Perth $670 ($0)       Hobart $550 ($0)       Darwin $700 ($0)       Canberra $680 (-$10)       National $669 (+$5)                UNIT MEDIAN ASKING RENTS AND WEEKLY CHANGE     Sydney $775 (+$15)       Melbourne $550 ($0)       Brisbane $630 (-$20)       Adelaide $500 (+$5)       Perth $628 (+$8)       Hobart $450 ($0)       Darwin $500 (-$15)       Canberra $570 ($0)       National $591 (+$)                HOUSES FOR RENT AND WEEKLY CHANGE     Sydney 5,426 (-22)       Melbourne 5,783 (+92)       Brisbane 4,042 (+149)       Adelaide 1,399 (+12)       Perth 2,345 (+25)       Hobart 383 (-2)       Darwin 94 (-10)       Canberra 595 (-9)       National 20,067 (+235)                UNITS FOR RENT AND WEEKLY CHANGE     Sydney 8,835 (+301)       Melbourne 4,537 (+107)       Brisbane 2,209 (+57)       Adelaide 391 (-8)       Perth 741 (-7)       Hobart 137 (+5)       Darwin 152 (-14)       Canberra 612 (+17)       National 17,614 (+458)                HOUSE ANNUAL GROSS YIELDS AND TREND       Sydney 2.57% (↑)      Melbourne 3.19% (↑)      Brisbane 3.40% (↑)      Adelaide 3.61% (↑)      Perth 4.06% (↑)      Hobart 3.85% (↑)      Darwin 5.46% (↑)        Canberra 3.58% (↓)     National 3.30% (↑)             UNIT ANNUAL GROSS YIELDS AND TREND       Sydney 5.37% (↑)      Melbourne 5.81% (↑)        Brisbane 6.08% (↓)     Adelaide 5.85% (↑)      Perth 7.13% (↑)      Hobart 4.44% (↑)        Darwin 7.55% (↓)     Canberra 5.88% (↑)      National 5.80% (↑)             HOUSE RENTAL VACANCY RATES AND TREND       Sydney 0.8% (↑)      Melbourne 0.7% (↑)      Brisbane 0.7% (↑)      Adelaide 0.4% (↑)      Perth 0.4% (↑)      Hobart 0.9% (↑)      Darwin 0.8% (↑)      Canberra 1.0% (↑)      National 0.7% (↑)             UNIT RENTAL VACANCY RATES AND TREND       Sydney 0.9% (↑)      Melbourne 1.1% (↑)      Brisbane 1.0% (↑)      Adelaide 0.5% (↑)      Perth 0.5% (↑)      Hobart 1.4% (↑)      Darwin 1.7% (↑)      Canberra 1.4% (↑)      National 1.1% (↑)             AVERAGE DAYS TO SELL HOUSES AND TREND         Sydney 30.3 (↓)       Melbourne 31.5 (↓)       Brisbane 31.7 (↓)       Adelaide 25.7 (↓)       Perth 35.4 (↓)     Hobart 33.7 (↑)      Darwin 36.2 (↑)        Canberra 32.0 (↓)     National 32.1 (↑)             AVERAGE DAYS TO SELL UNITS AND TREND         Sydney 31.3 (↓)       Melbourne 31.9 (↓)       Brisbane 32.1 (↓)       Adelaide 24.8 (↓)       Perth 38.7 (↓)       Hobart 37.6 (↓)     Darwin 46.5 (↑)        Canberra 39.2 (↓)     National 35.3 (↑)            
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The Middle East Becomes the World’s ATM

Flush with cash from an energy boom, Saudi Arabia and other Gulf monarchies have a moment on the world’s financial stage

By Eliot Brown and Rory Jones
Fri, Sep 8, 2023 8:48amGrey Clock 5 min

Five years ago, Saudi officials watched a wave of American finance executives pull out of a free investment confab in Riyadh after the murder of a dissident journalist made the kingdom a toxic place to do business.

This year, the conference, nicknamed “Davos in the Desert,” is expecting so much demand it is charging executives $15,000 a person.

Middle East monarchies eager for global influence are having a moment on the world’s financial stage. They are flush with cash from an energy boom at the very time traditional Western financiers—hampered by rising interest rates—have retreated from deal making and private investing.

The region’s sovereign-wealth funds have become the en vogue ATM for private equity, venture capital and real-estate funds struggling to raise money elsewhere.

The market for marquee mergers and acquisitions has seen a surge of interest from the region. Recently announced deals include an Abu Dhabi fund’s purchase of investment manager Fortress for more than $2 billion and a Saudi fund’s $700 million purchase of global lender Standard Chartered’s aviation unit.

Companies and funds overseen by Abu Dhabi’s national security adviser, Sheikh Tahnoun bin Zayed Al Nahyan, have made runs at buying Standard Chartered and investment bank Lazard. They have also struck recent deals to buy a $1.2 billion U.K. healthcare company and to take partial control of a nearly $6 billion Colombian food giant.

“Now, everybody wants to go to the Middle East—it’s like the gold rush in the U.S. once upon a time,” said Peter Jädersten, founder of fundraising advisory firm Jade Advisors. “It’s difficult to raise money everywhere.”

Fund managers visiting the region say they often wait across from rivals in waiting rooms of sovereign-wealth funds. Silicon Valley and New York managers are a near-constant presence in the white-marble floored lobby of the Four Seasons Abu Dhabi, as with other top hotels, they say.

The Riyadh conference next month—a pet project of Saudi Crown Prince Mohammed bin Salman known as the Future Investment Initiative—is expected to be a magnet for money hunters. In 2018, Wall Street executives backed out after Saudi operatives murdered journalist Jamal Khashoggi, and for years many startups and funds said they avoided investment from the country over moral concerns.

Some companies continue to steer clear of the kingdom, while human-rights groups say its record on treatment of government dissidents remains a serious problem.

But Saudi funding became more in demand last year when other money began to get tight. At last year’s conference the Public Investment Fund’s chief, Yasir Al Rumayyan, sat on a panel discussion with two of the world’s biggest investment-firm executives, Blackstone’s Stephen Schwarzman and Ray Dalio, founder of Bridgewater Associates. Top names in venture capital mixed on the floor, and FTX chief Sam Bankman Fried looked for funding.

Ben Horowitz, partner at Andreessen Horowitz, said at a PIF-sponsored conference this spring that Saudi Arabia was a “startup country,” and referred to Prince Mohammed as its “founder” who was creating a new culture and new vision for the country.

The region’s new dominance is most apparent among private funds, the type that lock up investors’ money for years. While detailed statistics are scarce, figures at two of the biggest sovereign funds suggest a surge. At Saudi’s PIF, commitments for “investment securities”—a category that includes private funds—rose to $56 billion in 2022, up from $33 billion a year earlier. Abu Dhabi’s Mubadala reported that equity commitments doubled to $18 billion in 2022.

Executives at private-equity giants TPG, KKR and Carlyle Group have told investors that interest from the Middle East remains strong while other parts of the world recede.

“If you’re in the U.S., there’s a certain degree of concern,” Carlyle CEO Harvey Schwartz said at a June conference. Middle East investors, he said, are “very front-footed, very dynamic.”

While the Middle East steps on the gas, the traditional backers of investment funds—pension plans and college endowments—are in retreat. The global shift to higher interest rates caused losses in the biggest parts of their portfolios—especially stocks and bonds.

Investors put $33 billion toward U.S.-based venture capital funds in the first half of 2023, less than half the $74 billion in the same period in 2021, according to PitchBook. Global fundraising for all private funds fell 10% last year to $1.5 trillion, according to Preqin—a decline many expect to continue.

“Fundraising has become much, much harder over the past 12 months,” said Brenda Rainey, an executive vice president at Bain & Co. who advises private-equity funds.

The reason for the region’s burst of funding and deal making is twofold.

Higher energy prices—a byproduct of Russia’s invasion of Ukraine—have given the region’s oil- and gas-dependent wealth funds tens of billions of dollars of extra money to spend. That means a drop in oil prices could quickly cause a pullback from the Gulf countries, as has happened in energy booms-turned-bust of the past.

At the same time, Saudi Prince Mohammed and top officials in the U.A.E. have jostled for greater sway on the world stage—in geopolitics, finance and sports—pumping additional money into their wealth funds to do deals and expand industry at home.

The intersection of politics and finance in the region has led Gulf wealth funds from Saudi Arabia, the U.A.E. and Qatar to be the main financial backers of two key Trump administration figures: Jared Kushner and former Treasury Secretary Steven Mnuchin, who together raised billions of dollars from the region.

Gulf funds have pushed their U.S. peers to open offices in the region to more easily win investments, fund managers say.

BlackRock has said it would create a team on the ground in Riyadh dedicated to boosting investment into infrastructure projects in the Gulf.

Millennium Management LLC, based in New York, set up an office in Dubai in 2020 and others followed, including private-equity firm CVC Capital Partners and ExodusPoint Capital Management, the largest-ever hedge-fund startup with $8 billion in initial capital. Europe’s Tikehau Capital and Ardian both established teams in Abu Dhabi, and U.S. alternative investment manager, Pretium, hired a local industry veteran from Dubai.

Dalio also set up an office in Abu Dhabi for the Dalio Family Office, his personal venture. Rajeev Misra, a longtime financier for SoftBank Group who secured over $6 billion in commitments for a new venture from multiple Abu Dhabi-aligned investment funds, is moving to the U.A.E. from the U.K., according to people familiar with his plans.

There is now an “awareness that relationships have to be built and that doesn’t happen overnight,” said Joseph Morris, a Dubai-based managing director at U.S.-based advisory firm Newmark Group.

The venture capital arm of Tiger Global has struggled to raise its latest fund, repeatedly cutting its target by billions of dollars. Stung by losses and the cooler fundraising environment, many U.S. investors have given it the cold shoulder, investors say.

One place it found success: Saudi Arabia. A division of PIF, Sanabil, this spring added Tiger’s name to the public list of fund managers it backs. Others on the list include Peter Thiel’s Founders Fund and Andreessen Horowitz.

Ibrahim Ajami, who oversees startup investments at Abu Dhabi state fund Mubadala, which invests in companies as well as funds, said the environment gives Mubadala the ability to be “very thoughtful and selective” about who it backs.

He can negotiate terms that let Mubadala buy a stake in the fund manager itself, he said, or allow it to invest alongside others.

“What we are doing is going deeper—and more concentrated and more engaged—with a select group of managers,” he said.

Summer Said and Berber Jin contributed to this article.



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Global economic growth is becoming more broad based, with surveys indicating that business activity in both the U.S. and the eurozone gained momentum in May.

The eurozone economy contracted in the second half of 2023 following a surge in energy and food prices triggered by Russia’s invasion of Ukraine, and the subsequent rise in interest rates intended to tame that inflation.

By contrast, the U.S. economy expanded strongly over the same period, opening up an unusually wide growth gap with the eurozone. That gap narrowed as the eurozone returned to growth in the first three months of the year, while the U.S. slowed.

However, surveys released Thursday point to a fresh acceleration in the U.S., even as growth in the eurozone strengthened. That bodes well for a global economy that relied heavily on the U.S. for its dynamism in 2023.

The S&P Global Flash U.S. Composite PMI —which gauges activity in the manufacturing and services sectors—rose to 54.4 in May from 51.3 in April, marking a 25-month high and the first time since the beginning of the year that the index hasn’t slowed. A level over 50 indicates expansion in private-sector activity.

“The data put the U.S. economy back on course for another solid gross domestic product gain in the second quarter,” said Chris Williamson, chief business economist at S&P Global Market Intelligence.

Eurozone business activity in turn increased for the third straight month in May, and at the fastest pace in a year, the surveys suggest. The currency area’s joint composite PMI rose to 52.3 from 51.7.

The uptick was led by powerhouse economy Germany, where continued strength in services and improvement in industry drove activity to its highest level in a year. That helped the manufacturing sector in the bloc as a whole grow closer to recovery, reaching a 15-month peak.

By contrast, surveys of purchasing managers pointed to a slowdown in the U.K. economy following a stronger-than-expected start to the year that saw it outpace the U.S. The survey was released a day after Prime Minister Rishi Sunak called a surprise election for early July, banking on signs of an improved economic outlook to turn around a large deficit in the opinion polls.

Similar surveys pointed to a further acceleration in India’s rapidly-expanding economy, and to a rebound in Japan, where the economy contracted in the first three months of the year. In Australia, the surveys pointed to a slight slowdown in growth during May.

Businesses reported that they were raising their prices at the slowest pace since November, which should reassure the European Central Bank. However, the eurozone continued to add jobs in May, suggesting that wages might not cool as rapidly as the ECB had hoped.

The ECB released figures Thursday that showed wages negotiated by labor unions in the eurozone were 4.7% higher in the first quarter than a year earlier, a faster increase than the 4.5% recorded in the final three months of 2023

The ECB has signalled it will lower its key interest rate in early June, while the Fed is waiting for evidence that a slowdown in inflation will resume after setbacks this year.

Nevertheless, eurozone businesses and households shouldn’t bank on successive cuts to borrowing costs, ECB Vice President Luis de Guindos said. “There is a huge degree of uncertainty,” he said. “We have made no decisions on the number of interest rate cuts or on their size,” he said in an interview published Thursday. “We will see how economic data evolve.”

Continued resilience in the eurozone economy would likely make the ECB more cautious about lowering borrowing costs after its first move, economist Franziska Palmas at Capital Economics wrote in a note. “If the economy continues to hold up well, cuts further ahead may be slower than we had anticipated,” she said.

– Edward Frankl contributed to this story.

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