US-based Neal behind $155m fund targeting Kiwi land snips
An American-based Queenstown entrepreneur is behind plans to invest $NZ155 million in distressed and under-valued New Zealand real estate.
Jason Neal, 40, whose mother Kathy was a long-time local councillor, set up Jumpstart Capital Partners in Los Angeles nine years ago to invest mainly in real estate securities.
Jumpstart hasn’t invested in this country so far but Neal says a NZ “opportunity fund” he plans to launch – Jumpstart Capital Asset Management – could yield an internal rate of return of up to 40 per cent.
In a press release this month, he says the fund has already secured a majority stake in a prominent resort and master-planned community in a stunning location in Australasia’s “fastest growing region”.
It sounds like Queenstown’s Jack’s Point – but no, Neal says. “We have not entered into any transactions in Queenstown.”
Neal is separately a partner in Strata Development Group (NZ) Ltd, which reportedly bought land at Jack’s Point for $NZ3.37m.
Last year Strata gained consent for a 15-unit development there, including a sunken health facility for owners.
The original consent was for 12 units and at the time, Neal said each would have a private 12-to-14-seat cinema and a wine cellar.
He agrees Queenstown is “certainly an attractive location for investment but frankly, our experience with local regulatory policy and agendas has left a bad taste” – he won’t elaborate.
In the 1990s Neal floated the idea of a high-tech Silicon Valley business cluster in Queenstown but “the [early-2000s] dot-com crash impacted the decision to advance”, he now says.
“But ultimately, NZ’s corporate tax system was not competitive and a barrier to moving forward.”
Jumpstart Capital Partners’ website says the company’s core focus is “resort destinations, high-end hotels and multi-unit residential”.
“We secure medium- to long-term investment opportunities independently, with reputable joint venture or co-investment partners.”
Neal’s press release is bullish about returns for his NZ opportunity fund.
Compared with the US and Europe, which are suffering economically, NZ is “well-positioned for a resurgence of strong domestic and foreign investment and sustained economic growth, which is expected to translate into strong capital growth within the real estate sector”.
On the other hand, he tells Mountain Scene, the NZ Government “must take a much more aggressive stance in lowering corporate taxes and introducing other fiscal incentives to attract foreign investment”.