The landscape of private equity is evolving as there is an Opportunity Zones gold rush happening throughout the country. Whether it be at the Opportunity Zone Expo in New York City, where our EVP Reid Thomas recently moderated a panel on capital stack or the many insightful OZ questions our team received at our booth during the same OZ event.
Investors want in on the OZ gold rush, including those from traditional retail channels. “The private equity world has not usually seen investors from the retail world such as broker-dealer clients and IRAs,” said Head of Fund Administration Michael Richards. “The Opportunity Zone legislature has enabled these investors to subscribe to these funds and JTC Americas has proven that it is able to use technology and industry expertise to assist these clients and help solve some of the issues they face.”
According to Christopher Hanewald’s OZ article in the Memphis Business Journal, “due to the close proximity to the exact type of limited partner investors with significant amounts of capital gains seeking deferral, private equity groups appear to be best positioned to capitalize on organizing and executing a Qualified Opportunity Fund.”
Hanewald also shared that “Ultimately, while access to more capital does not directly resolve the swelling multiple problems for private equity, access to cheaper capital might. With over 8,700 different QOZs designated across the country, it might take a bit of time to pare down that amount of data; however, the potential tax-advantaged benefit may be well worth the effort.”
The Private Equity market is clearly evolving — and is demanding solutions that keep pace within the Opportunity Zone space. Not only are managers looking to protect their margins and cut costs through automation and scale, there’s also a growing desire to “turn data into dollars” through advanced analytics that could allow them to generate actionable business insight into areas such as risk management and investment performance.
JTC Americas’ agility enables us to respond nimbly, quickly and effectively to these evolving needs. When new reporting requirements arise, our in-house, U.S.-based engineers can quickly adapt our systems, while legacy administrators lag behind. Our nimbleness also positions us to address some of the industry’s key fund accounting pain points — compliance, carried-interest calculations and timeliness of financial reporting.
JTC Americas has also made updates to our technology to address calculation of share classes and the share prices and have reported these balances to custodians, demonstrating that we have the flexibility to provide this information to our clients who use custodians such as Charles Schwab, Fidelity, Morgan Stanley etc.
Our purpose-built investor portal allows custodians and investment managers to log into our portal to see client/investor balances and track performance on the balances, which is one of the reasons why our PE clients who are managers such as Resolute Capital Partners value JTC Americas’ technology-driven approach to fund administration.
Finally, as the administrator of over 290 funds of all sizes, we also administer over $20B annually for our private equity, commercial real estate, and Fortune 1000 clientele. We wouldn’t be able to successfully operate without our team of financial professionals who average over 20 years of experience, along with our client services ambassadors who get to know your fund’s needs and processes intimately to help answer any questions our clients may have.
To learn more about our fund administration platform and our team, download our Private Equity Fund Administration Collateral!