Adequate liquidity has taken on a whole new meaning for many wealthy Angelenos.
A recent survey of high-net-worth individuals in the L.A. area by New York finance giant Morgan Stanley shows that water – or the lack thereof – is on their minds. A full 58 percent of respondents to the survey, released last week, said they are very concerned about the potential of a water shortage in their communities, and more than 25 percent said they’ve already been affected.
Alan Whitman, a managing director at Morgan Stanley Wealth Management in Pasadena, said it’s a natural issue given our geography.
“For Californians, this drought is a big-time event,” he said. “We live in a desert that wasn’t designed for this many millions of people.”
As you might expect, some wealthy Angelenos see opportunity in the region’s water shortage. While 83 percent of the individuals polled said the drought hadn’t impacted their investment portfolios yet, that might be the case soon. More than half of respondents showed interest in investing in water treatment or desalination companies.
While high-net-worth folks tend to throw dollars after issues near and dear to their hearts, Whitman said the challenge with previous sustainability and renewable energy and investments hasn’t been drawing interest – it’s been making money.
“The problem with a lot of these industries is that it’s very difficult to be profitable,” he said. “Everyone is for it, but the problem with it is that from an economic point of view, it’s very challenging.”
But while renewable sources of power have been undercut by cheap oil and gas, there’s really no substitute for water.
“I believe that water will be more valuable in many ways than oil,” Whitman said.
While the investors polled weren’t optimistic that Earth’s climate would be favorable in the near future, they certainly felt that way about the business climate. Nearly three in four were enthusiastic about the direction of the state’s economy, and a whopping 92 percent believed the L.A. economy is set to grow over the next 12 months.
The recent market seesaw hasn’t dampened that positivity, Whitman said.
“With this recent sell-off that we had, our phones were reasonably quiet,” he said. “People didn’t view this the same way as 2008. Back then, they were worried about the viability. Today they view it as a correction within a secular bull market. I think investors in general are pretty comfortable with what they see happening with American corporations.”
Private Club
With more and more people choosing online banking and ATMs instead of teller windows, banks have had to adapt to serving their customers in new ways.
Some, like El Segundo’s Xceed Financial Credit Union, have added more services, such as video chats with financial advisers, to their online and mobile platforms. But Irvine’s Banc of California Inc. has decided to add some luster to its brick-and-mortar side, going all in on a new luxury branch in Century City to serve its high-end private bank clients.
The bank, which operates a standard branch on Century Park East in the same neighborhood, recently rented a space in a Santa Monica Boulevard high-rise that was formerly used as storage and turned it into something much fancier.
Farah Ansari, a senior vice president at Banc of California’s private bank, said the new space is designed to give select clients a discreet place to meet their wealth managers and make transactions without having to make multiple stops or wait in the same line as the hoi polloi.
“We’ve found that our clients benefit from this concept, which joins relationship management teams with a high-end service branch, and creates a ‘one-stop shop’ experience,” she said. “It feels like an exclusive lounge – and that’s on purpose, to create a place clients want to hang out in whether in between meetings or running errands.”
With banks in heated competition over business leaders and high net-worth individuals, Ansari feels having a club-like bank tucked in among the office towers of Century City should be a valuable asset.
C-Suite News
UCLA has agreed to a multiyear deal with Pasadena’s Wescom Credit Union, branding it as the official financial institution of UCLA Athletics. … BNY Mellon Wealth Management, part of Bank of New York Mellon Corp. in New York, has named Chris Mone regional president of the firm’s wealth management office in Los Angeles. He was previously with Swiss finance giant UBS. … Ontario’s CVB Financial Corp., the parent company of Citizens Business Bank, has named Kristina M. Leslie to its board. … Radnor, Pa., insurance giant Lincoln Financial Group has named Javier Obando director of business development on its institutional retirement distribution team. He is based in the firm’s L.A. office.
Staff reporter Matt Pressberg can be reached at [email protected] or (323) 549-5225, ext. 230.
