Ghost Offices of the Hedge-Fund Boom: Your Guided Tour

A certain un-businesslike calm envelopes the place. The lights are dim. The silence seems to command a hushy respect, the kind reserved for the deathbed.

Here, on the 37th floor of the IBM Building, at 590 Madison Avenue, the offices belonging to a London-based hedge fund called BlueBay Asset Management, once alive with the daily hustle of money trading and commission inflating, sit empty.

The personalities, who a source says agreed to spend $150 to inhabit each of these 7,308 square feet annually, have since departed. Cultural artifacts remain.

A “Handbook for Fixed Income” lies in an unoccupied cube. No activity enlivens the 24-desk trading floor, subdivided by rows of identical flat-screen monitors. On one of the screens, small young men in business dress move jerkingly about. They are at the fund’s still-functional London operation, digitally projected into the vacant New York office via the wonders of the Webcam, like the ghost of workdays past. Three clocks on the wall keep time in England, Tokyo and Manhattan.

Visitors can peer through broad glass windows at other, similarly grandiose midtown monuments now empty, towers that quite literally once elevated their occupants above the hoi polloi to the trading floor.

The offices these occupants left behind, those which their brokers now seek to sublease, are relics of a bygone era—one in which lavish spending on homes, workplaces, private helicopters, knew few bounds. Now, to pick up the reference to Shelley’s “Ozymandias” right after the money quote you’ve read too often, they are colossal wrecks, boundless and bare. These are the ghost offices of the Hedge Fund Boom, and more are cropping up all the time.

OUTSIDE OF BlueBay’s offices, you can take the elevator to the 39th floor and visit a similar scene at the former home of Trafelet & Company, nearly four times as large as BlueBay’s. It’s also four times as opulent.

Trafelet is the hedge fund run by Remy Trafelet, the young manager depicted in a Oct. 13, 2008, article in The New York Times as emblematic of the ascent of the hedge funders.

The article recounted how Mr. Trafelet once whisked 100 employees away to the Hotel Bauer, in Venice, for a long weekend. By the time of the story, Mr. Trafelet’s fund was worth $3 billion, down from $6 billion during the height of the boom.

When he signed the lease, he agreed to pay $160 a square foot, according to a source. Now, he’s trying to sublease the space for $100. But it’s probably worth asking whether the expensive Country Gentleman ambience—dark wood and grouse paintings—has much of a market these days, even at $100 a foot.

There is a full kitchen, larger than those in some restaurants, and an ample lunchroom. From the window, the visitor sees Central Park, but from such a height that it resembles the original Olmsted and Vaux rendering of the greensward, a warren of interlocking bridle paths and greenish-brown grass.

FRANKLY, neither of the above matches the elegant, restrained refinement of Metrovest’s offices at the Bloomberg Tower at 731 Lexington Avenue.

Here’s how the Web site of Ted Moudis, its architect, describes the space (it was not possible to take photos of these offices, because they are not open to the public): “An undulating drywall ceiling visually leads you from the reception through the boardroom, which has breathtaking views. Full-height glass panels and sliding door glass partitions were brought in to define the executive suite, administrative area and the private offices without visual boundaries. Breaking away from the linear office plan, a ‘triple egg’ structure that comprises [a] pantry, lounge and ‘think pod’ was centrally located to encourage interaction. The use of natural and refined materials such as: French walnut, nickel mesh, composite stone, and clear glass allow the space to pay homage to the company’s roots in construction.”

Sources say Metrovest, a real estate investor and developer, paid around $300 a square foot to renovate and furnish the space, which comes to about $3.8 million. A few years later, the partially occupied space is up for sublease.

During a recent visit, no one reclined in the two black leather lounge chairs; no one watched the flat-screen TV that they faced; no curious eye peered through the powerful telescope near the window, from which, on a clear day, the view crosses the 59th Street Bridge and stretches all the way past Coney Island to the Atlantic Ocean.

None of the leaseholders mentioned above would comment for this story. But, rest assured, some day an interloper, unafraid of surroundings so rich in a climate so populist, will find use for these palaces of capital.

At the right discount, of course.


Ghost Offices of the Hedge-Fund Boom: Your Guided Tour