By Sarah Trefethen
When Apollo Real Estate investors (now AREA Property Partners) started up in 1993, one of the opportunity fund?s first deals was a derelict property in South Beach, Miami.
?I remember getting a fax ? it was background info on this hotel that was sort of uninhabitable,? John Jacobsson recalled recently.
JOHN JACOBSSON
Apollo, where Jacobsson was part of a three-person investing team, entered a partnership with Ian Schrager to gut renovate the Delano.
?I think we had it open by 1995,? Jacobsson said. ?That one asset has gone on to become something of an icon.?
Strategic partnerships were one of the keys to Apollo?s early success, Jacobsson said, and in his career with the firm, he developed relationships with many of the best operators in real estate.
Thus, he said, he feels right at home in his newly-created position as executive vice president at Related Companies.
?I?ve known Related for over 20 years, so it really feels completely natural to be here,? he said.
Jacobsson?s responsibilities will focus on raising capital for Related?s development projects though the global institutional investor community, while also providing insight into potential new investments and sourcing transactions.
?The real estate industry is now a global industry,? he said, adding that when he first got involved in raising capital, 99.5 percent of financing for U.S. real estate projects came from domestic institutional investors. ?Fast-forward to today, and the sources of capital ? both of debt and equity ? are coming from around the world.?
Jacobsson grew up in Massachusetts and Connecticut and graduated cum laude from Harvard University, where he majored in East Asian Studies. Having entered the university with a full year of college credits already under his belt, he was able to take off his junior year, which he spent in a treasury specialist intern program with Bank of Boston, in their Tokyo office.
?Removing myself from my ordinary environment and taking away my comfort zone was tremendously energizing and exciting for me,? Jacobsson said.
After graduation, he was looking for another adventure and chance to experience a new culture ? this time staying within the United States.
So, in 1990, he left New England for Texas and joined the acquisitions group of Trammell Crow Ventures in Dallas.
The market was weak, and when he told his professors and parents he was taking a job in real estate, ?they looked at me like I was crazy,? he said.
?But, I thought, if no one else is going into this field ? this will be a tremendous learning opportunity.?
And, indeed, Jacobsson describes his time with Trammell Crow as a timely entre to the emerging sector of opportunistic investment. His plans to work for a few years and attend business school were pre-empted when the opportunity arose to join Apollo here in New York.
In addition to the Delano Hotel deal, other early Apollo projects included a strategic buy-up of Olympia York?s debt that left Apollo as one of the largest creditors in Olympia York?s USA bankruptcy.
?It was kind of a really exciting time and a complex transaction,? he said.
Jacobsson and his wife, a Harvard Business School graduate he met when they were co-workers at Trammell Crow, have four children between the ages of two and 14 years.
Outside of work, he donates his time supporting educational instruction and promoting access to education, serving as a trustee of Groton School, a boarding school he attended in Massachusetts, and of Trinity School in New York City. He also serves on the board of directors of HEAF, a Harlem-based program that supports promising public school students from sixth grade through college graduation.
?It?s one of these programs that can tremendously change the lives of the kids who get involved in it,? Jacobsson said. Related?s multi-billion dollar pipeline of development projects include the 13 million square Hudson Yards development, several residential rental buildings in New York City, Gateway Center Phase 2 in East New York and Willets Point and Hunter?s Point South in Queens. Internationally, the firm has several projects underway in the Middle East, including Sowwah Square and Sowwah Central in Abu Dhabi and a large-scale residential development in Riyadh, Saudi Arabia.
?I think we?ve come a long, long way since 2008, both on the debt side, where lenders are back on their feet and lending again ? I will say for the right projects; the project has to be well conceived and have the right sponsorship,? he said. ?On the equity side ? institutional investors have begun again to have an appetite for risk.?
Adding to Manhattan?s supply of modern, Class A office space with projects like Hudson Yards is a smart strategy for New York investment, Jacobsson said.
?We?re creating, new, modern, more efficient office space and not getting sort of caught up in a bidding frenzy for existing space,? he said, noting that buildings from the 1980s are now 30 years old. ?I think it?s great to be on a team that?s creating new office space.?
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