July 7, 2007 (LPAC) - The prospect of new legislation regulating
activities of hedge funds and private equity funds in Germany,
and the flop of speculative profit expectations, especially on
the German housing and real estate market, apparently have led
fund managers to the conclusion that "this is no good country to
stay in." That is also the conclusion in an international
overview report for the private equity sector, just published in
London, and reported in the economics section of the Frankfurter
Allgemeine Daily, today: Germany is getting a very negative
rating, because of "excessive regulation of the labor market, too
high wages, and the tax burden on enterprises." For equity funds,
conditions on the German market are "outspokenly miserable," the
report assesses. Another problem for funds is that German
enterprises are overly "oriented towards the employees, labor
unions, clients and the influence of the state, and never focus
on the interests of the shareholders."

Cerberus is already pulling out, selling about 30,000 flats
owned by its daughter firm Baubecon; so also Goldman Sachs,
is announcing the sale of corporate real estates just purchased
in early May. The US fund Oaktree also sold flats, and other
funds are said to be following soon.