The Mega Rich Have Found an Unlikely New Refugeby
New Zealand’s isolation is a virtue amid terror, U.S. election
Brexit spurs wave of interest from Brits seeking to migrate
When Hong Kong-based financier Michael Nock wanted a place to escape in the wake of the 2008 global financial crisis, he looked beyond the traditional havens of the rich to a land at the edge of the world, where cows outnumber people two-to-one.
Nock, the founder of hedge fund firm Doric Capital Corp., bought a retreat 5,800 miles away in New Zealand’s picturesque Queenstown. In the seven years since, terror threats in Europe and political uncertainty from Britain to the U.S. have helped make the South Pacific nation -- a day by air away from New York or London -- a popular bolthole for the mega wealthy.
Isolation has long been considered New Zealand’s Achilles heel. That remoteness is turning into an advantage, however, with hedge-fund pioneer Julian Robertson to Russian steel titan Alexander Abramov and Hollywood director James Cameron establishing multi-million dollar hideaways in the New Zealand countryside.
“The thing that was always working against New Zealand -- the tyranny of distance -- is the very thing that becomes its strength as the world becomes more uncertain,” Nock, 60, said by phone from Los Angeles during a recent business trip.
The Other “Giverny”
Nock’s 2-hectare (5-acre) estate is named “Giverny” after artist Claude Monet’s iconic home and garden in northern France, and the “funny old farmhouse” is surrounded by ponds and mature plants, he said. Nock is converting a barn into an art studio on the property, which overlooks Queenstown’s Shotover River -- a fast-flowing, turquoise stretch of water that tourists speed down on jet boats and whitewater rafts.
Twice the size of England, but with less than a tenth of its people, New Zealand ranks high on international surveys of desirable places to live, placing among the top 10 for democracy, lack of corruption, peace and satisfaction. With its NZ$250 billion ($180 billion) economy dominated by farming and tourism, the nation last week overtook Singapore as the best country in the world to do business and was rated second to the Southeast Asian nation as the top place to live for expatriates in a survey by HSBC Holdings Plc. in September.
House prices in New Zealand increased 12.7 percent in the year through October, and the average price in largest city Auckland has almost doubled since 2007 to more than NZ$1 million.
Jack Ma, founder of e-retailing behemoth Alibaba Group Holding Ltd. and China’s richest man, told Prime Minister John Key in April that he’d like to buy a home in his country, according to the New Zealand Herald. At least 20 of Ma’s 40-something colleagues have retired there, the newspaper said.
Key, a former currency trader, once described New Zealand as “England without the attitude.” It’s changed leaders just twice in almost 17 years and the last hint of terrorism came a generation ago, when French spies bombed a Greenpeace campaigning ship docked in Auckland harbor in 1985.
It’s that kind of stability that’s attracting a wave of Brexit-inspired migration to the island nation that gained prominence as the otherworldly backdrop to the “Lord of the Rings” and “The Hobbit” films.
New Zealand received 998 registrations from U.K. nationals interested in moving to the country the day after the referendum on European Union membership, versus 109 the day before the vote, according to data from the immigration department. That grew to 10,647 registrations in the 49 days after June 23, more than double the same period a year earlier.
“If the world is going to go to hell in a hand basket, they’re in the best place they could possibly be,” said David Cooper, director of client services at Malcolm Pacific Immigration in Auckland, the country’s biggest migration agency. “People want to get the hell out of where they are and they feel that New Zealand is safe.”
Cooper has seen an uptick in inquiries from U.S. citizens over the past few months, he said, with the increasingly raucous presidential fight between Donald Trump and Hillary Clinton, as well as the recent spate of mass shootings, cited as reasons to flee.
“The world is heading into a major crisis,” said Internet entrepreneur Kim Dotcom in an Oct. 31 Twitter post. “I saw it coming and that’s why we moved to New Zealand. Far away & not on any nuclear target list.” The German-born founder of megaupload.com was granted residency in 2010, but is now fighting attempts to extradite him to the U.S.
Successful Kiwis who have worked in investment banking and other lucrative professions in New York and London are also returning home to raise their families, said Ollie Wall, a realtor with Auckland-based Graham Wall Real Estate Ltd. The firm helped broker New Zealand’s most expensive house sale in 2013, when a seven-bedroom mansion on the city’s Paritai Drive was sold to a China-born businessman for NZ$39 million.
“The world has got smaller,” Wall said in an e-mail. “You can run multinational corporations from paradise now. So why wouldn’t you?”
Fidelity National Financial Inc. Chairman Bill Foley owns a luxury homestead in the Wairarapa region north of Wellington, and Robertson, chair of Tiger Management LLC in New York, owns two of the nation’s most prestigious golf courses and a luxury lodge overlooking Queenstown’s Lake Wakatipu. He says New Zealand is “the most beautiful place on Earth.”
Billionaire Facebook Inc. backer Peter Thiel described New Zealand as a “utopia” in 2011 and is reported to have bought residential property in Auckland and Queenstown. Thiel and a spokesman for the PayPal co-founder didn’t respond to e-mailed requests for comment.
New Zealand has actively courted the wealthy. For an investment of NZ$10 million in local assets or funds over a three-year-period, migrants can qualify for residency provided they spent 44 days in New Zealand in each of the two latest years. These investors don’t have to speak English or live for a set amount of time in the country after the qualification period. They also don’t have to become tax residents.
Since the program started six years ago, 121 people have gained so-called Investor Plus visas, and more than 800 have secured a residency pass that requires a NZ$1.5 million investment over four years, government data show.
“It provides a bolthole, a place for ‘just in case’,” said Willy Sussman, a partner at Auckland law firm Bell Gully, which has worked with wealthy migrants from all over the world.
The desire for a haven nestled among snow-capped alps close to an international airport helped house prices in Queenstown increase at more than twice the pace of Auckland in the year through October, reaching an average of NZ$974,564.
Mark Harris, managing director of the town’s Sotheby’s Realty office, said he has sold properties for more than NZ$20 million, including ones with private landing strips.
“We hedge fund people all love optionality,” said Nock, the part-time Queenstown resident from Hong Kong. “Will I live in New Zealand permanently? I’m not sure, but I want the optionality of being able to do that.”