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US private equity firm eyes Christchurch opportunities

Published: 10:49AM Wednesday August 31, 2011 Source: ONE News

A United States private equity firm eyeing investment in quake-damaged Christchurch says it's not forcing its way into the city, but has had a phenomenal response there.

Vesta Equity specialises in buying or financing real estate, mainly in the southeast United States and in the state of Texas.

The company has the same principal as Ceres Environmental, a US contracting firm specialising in disaster recovery, demolition and debris operations after major catastrophes such as earthquakes, hurricanes and floods.

Vesta Equity managing director George Kruse has been in Christchurch this week on the hunt for opportunities.

He told TV ONE's AMP Business he and a team of four people have been meeting with a wide array of people from local property lawyers to local owners, the Chamber of Commerce, and engineers who have been looking into the stability of various parts of the property market.

Private equity does not have a good reputation in some quarters in New Zealand, but Kruse said the response had been phenomenal.

"For every one meeting we've had, two new ones have been set up. I think everyone's looking for a common good," he said.

"We're not coming in here to necessarily purchase property or be outside capital forcing our way into Christchurch. We're intentionally looking to partner up with the existing owners and developers within Christchurch. We feel that that would be a positive for everybody."

Kruse said Vesta Equity is not strictly looking at the bottom line. It has "a unique opportunity" through the expertise of its principal to take an overview of how best to work with the City of Christchurch as a whole and the individual owners and developers in the city who are going to build it up, he said.

"At this stage we're trying to get a pretty broad overview of where best to look within Christchurch. I think the certainty that we've put together is that we definitely want to be here. We feel there is a lot of opportunity to work with people in Christchurch."

He sad Vesta Equity feels Christchurch is a resilient market and is going to be a successful opportunity.

"The question now is how we can best play to assist Christchurch and the owners."

Some members of the company's team will remain in Christchurch for the next 10 days continuing diligence, he said.

The US company's interest in Christchurch comes amid continuing aftershocks, delays to the rebuild and a blow-out in the projected cost .

The government announced yesterday that the Earthquake Commission faces Canterbury earthquake claims of up to $7.1 billion, close to double the $4 billion in claims originally estimated, and $1.1 billion more than its $6 billion Natural Disaster Fund.

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