US fund targets distressed New Zealand assets

Jumpstart Capital Partners, a privately-owned American real estate investment company, says it is putting together a US$100 million ($156 million) fund "to capitalise on distressed and undervalued real estate assets" in New Zealand.

Jumpstart Capital Asset Management is being driven by an executive who has previously raised money in a separate venture to invest in Queenstown's Jacks Point subdivision.

Jason Michael Neal, chief executive at Los Angeles-based Jumpstart Capital, is also a director of Strata Development Group (NZ) which invested in houses at Jacks Point. About a quarter of Strata's shares are held by Strata Development Group LLC, a joint venture between Jumpstart Capital and American investor Andy Funk, of Santa Monica set up in 2004.

The men paid $3.37 million for 0.87ha of land at the Jack's Point development near Queenstown to build 12 luxury homes.

Now Neal says the new US$100 million fund will buy commercial and residential real estate, real estate-related assets and land development projects. He told potential American investors that investments made in the "safe haven" of New Zealand can produce an internal rate of return of more than 40 per cent.

"Smart money is now being invested in countries that offer resilient stable economies, attractive foreign investment and tax policies, and can be classed as safe havens. New Zealand is one of the few countries that fits this profile

"The fund has already secured an anchor investment that comprises a majority stakeholding in a prominent resort/master-planned community development".

- NZPA