REAL ESTATE - Morgan Stanley is to split its $45bn (€34bn) global real estate investment from banking operations – bucking a recent trend for investment banks to merge their operations.

Morgan Stanley’s real estate will be housed in a division designed to cluster alternative assets – specifically real estate, infrastructure and private equity. The division will be headed by Owen Thomas, who built the real investment business.

The move will enable alternatives fund managers to gauge best practice from the real estate division set up in 1991. This is already feeding into the bank’s infrastructure sub-division.

The change is not regarded as a major restructuring and a spokeswoman for the bank said it would have "no client impact".

Banking and investment management would continue to work closely, with "no Chinese walls", the spokeswoman said.