Action plan: A view of the Abu Dhabi city from the observation deck of the Emirates Towers. City officials are looking to seize the moment to offer a fresh package of lifestyle perks in the hopes of attracting more financiers. — Reuters
LONDON: Abu Dhabi officials are quietly orchestrating a fresh package of perks they hope will help propel the city up the ranks of the world’s biggest financial centres, from helping traders obtain coveted school admissions for their children to assisting them with securing memberships at country clubs.
While the city’s US$1.5 trillion in sovereign wealth capital will continue to be the main draw for hedge fund managers making a beeline for Abu Dhabi, officials are formalising a programme that will offer incentives, including lifestyle support and visas, as part of its overall package for finance professionals moving to the region.
The bet is that these perks, along with the city’s tax-free status, sunny weather and a time zone that allows workers to trade across Asian, European and US hours, will help it continue to lure hedge fund titans from New York, London, Hong Kong and Singapore.
“We are positioning ourselves globally by benchmarking against the likes of Hong Kong and Singapore right now,” said Arvind Ramamurthy, who leads market development at the Abu Dhabi Global Market (ADGM), the emirate’s financial free-zone.
“In the long-term, we want to be compared with London and New York.”
There are already signs that some of the city’s early moves are working.
Brevan Howard Asset Management now manages more money from the emirate than it does anywhere else on the planet.
Goldman Sachs Group Inc, Rothschild and Co and Morgan Stanley are among the global financial firms opening up offices in Abu Dhabi.
The financial centre had 1,825 operational entities as of the end of last year, up by a third from 2022.
ADGM said it’s been the fastest-growing financial centre in the region for two consecutive years.
“We’re connecting people to not just a pool of capital but are providing them a place to call their home,” Ramamurthy said. “We have quality capital.”
Neighbouring Dubai, long considered the Middle East’s de facto business and finance hub, offers similar advantages.
Like Abu Dhabi, Dubai’s financial free-zone managed to draw in the hedge fund crowd through incentives including reduced licencing fees.
Izzy Englander’s Millennium Manage-ment set up there recently and now has a workforce of more than 70, according to a person familiar with the matter, who asked not to be identified discussing non-public information.
Over the next year, Balyasny Asset Management aims to double its 12-person workforce in Dubai, another person familiar with the matter said.
The fund already has big name hires making the move to the city, including consumer-focused equities portfolio manager Marco Minoli. But Dubai’s success has come at a cost. Waiting lists for schools and social clubs in the city run long.
Reservations at some restaurants can take weeks and key roads are routinely jammed.
One executive recently complained it can take an hour during rush hour to exit the parking lots in the financial district.
That’s likely to get worse – policymakers predict Dubai’s population will surge to 5.8 million in 2040 from over 3.5 million currently.
In contrast, streets and malls in Abu Dhabi are relatively less busy. Restaurants are starting to fill up, though reservations are easier to come by – for now.
That’s why city officials are looking to seize this moment to offer up a fresh package of lifestyle perks in the hopes of luring more financiers to their ranks.
Brevan Howard’s decision to turn Abu Dhabi into its biggest risk-taking centre is one of the clearest signs yet of the city’s growing heft.
The macro-trading investment firm runs about US$10bil from the emirate’s international financial free-zone and it has grown its local team to more than 80 staffers.
The firm’s co-founder, billionaire Alan Howard, has predicted Abu Dhabi could become a global financial centre.
“You can see the Bank of Japan beginning of the day and at the end of the day you can see the US Federal Reserve,” Howard said in a rare public appearance late last year.
“So that is an incredible advantage of Abu Dhabi and because of that we also need an execution desk here.”
In addition to the favourable time zone and year-round sunshine that have drawn a plethora of traders to the region, the UAE is also one of few countries around the world that welcomes the rich.
That’s a change of pace from other nations, where billionaires often find themselves under scrutiny. — Bloomberg
