In a big case of spending money to make money, Queenstown-based Hugo Charitable Trust has splashed $17.6 million on two local commercial properties.
The national charity — which has donated $15m-plus to various charitable causes over the past seven years — bought Bayleys House,
in 2019, for $10.15m, and last December, the New Zealand Couriers building, also in Frankton, for $7.45m.
But, rather than using the buildings’ rental income to pay back the purchases, Hugo puts it all back into its large charity pot.
In the case of Bayleys House, that’s currently $461,145 a year, and for the NZ Couriers building it’s $328,440 per year.
As a bonus, last year two Bayleys House tenants — realtor Bayleys and law firm Cruickshank Pryde — each donated $10,000 to Hugo for nominated charities.
Hugo chair and trustee Mark Owens says the investment properties are a way of diversifying the charity’s income.
Rental income from the Queenstown commercial buildings is going to charitable causes
‘‘We didn’t want it all in the bank or all in equities.
‘‘It’s really just risk management, so we’ve always got that rental income coming off those two buildings, and then we can donate it.
‘‘We’ve got overall plans to have a third in property, a third in equities and a third in cash deposits.’’
Owens says they’re keeping an eye out for a third property in a similar price bracket to the other two.
‘‘We like something reasonably new — we want to be pretty passive, we don’t want to be active property managers, as such.’’
He says they’ve so far chosen Queenstown properties partly due to their likely capital appreciation — ‘‘we think [Queenstown’s] capital
growth’s going to be as good as anywhere in NZ’’ — and partly because he and the charity are based here.
‘‘We live down here so it’s a bit easier to manage … it’s nice just having it in the area you know.’’
Wheel support for high school students
‘Thanks, Hugo’: Pictured receiving a van from Hugo Charitable Trust are, from left, Wakatipu High principal Oded Nathan, Hugo Charitable Trust CEO and trustee Aoibheann Monaghan and trust chair/trustee Mark Owens
Hugo Charitable Trust this week donated a $65,000 4WD van to Wakatipu High School to reduce costs for students travelling for extracurricular activities.
It’s also able to take Year 10 students to the annual Branches Camp along the hazardous Skippers Road.
The van’s been donated via the Wakatipu High School Foundation, which aims to keep students’ participation in extracurricular activities high at a time many families are struggling financially.
Foundation chair Charlie Phillips says the generous donation will have a ‘‘significant, long-lasting impact on youth in the area’’, and they’re ‘‘deeply appreciative’’.
