(Bloomberg) -- In the latest round of hedge fund closures, Jack Franke and Eric Lee, who once worked for billionaire Stan Druckenmiller, are liquidating their firm after about two years in business, according to people with knowledge of the matter.
Their Blockhouse Capital Management oversaw about $541 million including borrowed money as of the end of last year, a regulatory filing shows.
“We have recently determined that we may not be able to generate the performance you expect from us going forward in the current market environment,” Blockhouse said in a letter to clients, an excerpt of which was seen by Bloomberg News.
While liquidations of funds slowed in the first quarter, over the past three years more hedge fund managers closed than those who hung out their shingle as the industry posted mediocre returns and fell out of favor with investors. Earlier this month another small fund, Pelorus Jack Capital, told clients it’s closing after about a year of trading, joining veteran managers from Neil Chriss to Andy Hall who’ve shuttered funds in the past 12 months.
Franke and Lee had worked for Druckenmiller at his Duquesne Capital Management, which the billionaire converted to a family office in 2011. Franke was one of the founders of PointState Capital, which Duquesne alumni started in 2011. He and Lee, who was PointState’s distressed investments chief, left in 2016 to start Blockhouse.
Steve Bruce, a spokesman for the New York-based firm, declined to comment.
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