By Suzanne McGee and Davide Barbuscia
(Reuters) – Los Angeles-based asset management firms are grappling with the impact of the region’s destructive wildfires on their operations, with some relocating office space and supporting staff members who have lost their homes.
The Los Angeles area is home to large industry players like Capital Group, TCW Group and hedge funds Oaktree Capital and Ares Management. In total, firms in Los Angeles manage more than $4 trillion of the $132 trillion in global assets managed in the United States.
The blazes have reduced entire neighborhoods to smoldering ruins, leaving an apocalyptic landscape and devastating both suburbs and wealthy enclaves.
“A number of our team members have been displaced and several have lost their homes completely, my family included,” said Katie Koch, president and CEO of TCW, a firm that manages $203 billion in assets, in a letter to her Los Angeles colleagues that she reposted on LinkedIn.
TCW said all of its Los Angeles-based employees are safe and accounted for. Koch did not respond immediately to a request for comment, but a company spokesperson confirmed that her home had been lost to the fire.
Anacapa Advisors, a $60.5 million hedge fund that moved into new, larger offices in Pacific Palisades only weeks before the fires, saw that building burn to the ground as the Palisades Fire, the largest of several fires sweeping across Los Angeles County, whipped through the community, according to a spokesperson for the firm.
In a letter to the firm’s clients, Phil Pecsok, Anacapa’s founder and CIO, said all of its employees are safe and that the team successfully activated its business continuity plan.
They now are working remotely “with full access to trading platforms and risk monitoring systems.” They are placing orders for additional trading screens and communicating with each other continuously via Zoom, he said.
Pecsok did not respond immediately to a request for further comment. The spokesperson said Pecsok was working from a second home after evacuating from his primary residence.
Other asset management firms are taking precautionary steps as forecasts predict the region’s flame-fanning Santa Ana winds will persist through to Wednesday, raising the risk that fires may spread further.
Oaktree Capital, a hedge fund firm managing more than $200 billion in assets located in downtown Los Angeles, remains open for normal business operations, said Todd Molz, the firm’s chief operating officer. Many of Oaktree’s 700 employees in the area have been affected by the fires, he said.