State Street Integrates MSREI - Analyst Blog
February 28 2013 - 9:00AM
Zacks
State Street Corporation (STT) announced the
integration of Morgan Stanley Real Estate Investing’s (MSREI) fund
servicing business – the real estate investment management wing of
Morgan Stanley (MS). This is a notable addition to
the 40-year relationship between these two companies. Moreover, it
boosted State Street's market-leading alternative and real estate
fund servicing business. The integration process started in Feb
2012.
Roughly 150 employees of MSREI moved to State Street on completion
of the integration. The company is offering wide-ranging accounting
and administrative services across MSREI’s full range of investment
offerings.
Management at Morgan Stanley believes that State Street’s
leadership position in servicing alternative assets, combined with
modern technologies and commitment to customer service, was a boon
for MSREI.
State Street's Alternative Investment Solutions (AIS) unit provides
a wide-ranging suite of middle office, fund administration, risk
analytics and credit services to hedge funds, private equity funds,
real estate funds and institutional investors. The AIS division has
more than 3,000 employees globally, and it managed roughly $1.1
trillion in alternative assets as of Dec 31, 2012.
Management states that the elevated operational and technology
costs, complex fund structures, increased governance and
transparency demands were the primary reasons for its alliance with
Morgan Stanley in real estate fund management. The integration of
MSREI’s fund servicing segment further reinforced State Street's
AIS unit.
With the favorable trend towards private real estate investments,
the outsourcing of real estate fund administration is anticipated
to surge. Therefore, we believe that real estate investors will
gain from the combined entity, which will support their long-term
growth and expense management.
State Street currently carries a Zacks Rank #2 (Buy). Other major
regional banks that are performing well include BankUnited,
Inc. (BKU) and Fifth Third Bancorp
(FITB), carrying Rank #1 (Strong Buy) and #2, respectively.
BANKUNITED INC (BKU): Free Stock Analysis Report
FIFTH THIRD BK (FITB): Free Stock Analysis Report
MORGAN STANLEY (MS): Free Stock Analysis Report
STATE ST CORP (STT): Free Stock Analysis Report
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