Goldman Sachs is quietly building a team of placement agents to raise non-Goldman alternative investment funds, according to sources.
The addition of a new placement business within private equity real estate will create greater competition in an already highly competitive market.
The news was first reported in the March issue of sister publication Private Equity International.
A Goldman Sachs spokesperson declined to comment.
According to a source, Goldman Sachs has designated professionals from different groups within the investment bank to raise capital for alternative investment funds, including private equity real estate funds, on a selective basis. Professionals are being drawn from the financial sponsors group, the leveraged finance group and the securities group, the person said.
Goldman Sachs already has a stable of in-house alternative investment funds, including private equity, real estate, hedge funds, infrastructure and funds of funds. The new placement business is described as an effort to further monetise Goldman’s extensive LP relationships.
Investment bank-affiliated placement agencies, including groups within Credit Suisse, UBS and Merrill Lynch, are among the most successful such businesses. Goldman Sachs has been notably absent from the business, although the firm dominates as a provider of M&A advice and as a manager of alternative investment funds.
A Goldman Sachs placement business puts the firm in a good position to win fundraising assignments from high-profile GPs who occasionally leave Goldman Sachs to launch their own firms.