Published: Wednesday 16, 2008
Three of the capital's finest pieces of commercial estate - The Towers, the New Kingston Shopping Centre and former drive-in cinema in New Kingston - as well as the Fair View Shopping Centre in Montego Bay, have been put on sale by their owner, the Cable & Wireless Pension Fund, in what will be a major realignment of its portfolio.
Although no price tag has been publicly placed on the properties, Wednesday Business sources say that, combined, they could fetch well over J$2 billion. Trustees of the Cable & Wireless Pension Fund were not immediately available for comments on the proposed sale or on how they intend deploy any cash gained from the transaction.
Restructuring
Herbert Hall, the executive chairman of Prime Asset Management, which manages the fund on behalf of the trustees, declined to speculate on how the returns will be used.
"They (the Cable & Wireless Pension Fund) are the ones who have put the properties up for sale; I am simply following their instructions," said Hall. "I am not in a position to say why they are selling."
However, a spokesperson at West Indies Home Contractors, a Prime Asset Management sister company that is handling the sale, stated the obvious: "The client is restructuring/realigning its assets held in the pension fund."
Both Prime Asset Management and WIHCON are members of the Joseph M. Matalon-controlled ICD Group.
The bids close August 28 and tender documents on the properties will be opened on the same day at Prime Asset Management's offices on Harbour Street, downtown Kingston.
Like the other two New Kingston complexes, The Towers were built in 1985 by Life of Jamaica (LOJ), now Sagicor. They are twin structures - one 10 stories and the other 12 - on Dominica Drive, with a combined area 112,850 square feet on 73,976 square feet of land.
Cinema Lands
On the other side of the road are the Cinema Lands, the former double-screened drive-in cinema that was closed in the 1990s when burgeoning cable television and other video entertainment media made drive-in unviable in Jamaica.
The 7.58 acres property now accom-modates a theatre, a parking lot and a vehicle showroom.
Property experts say that land in this area would value between J$5,500 and J$6,000 per square foot.
Adjacent to the defunct cinemas is the New Kingston Shopping Centre, a 175,848 square feet shop and office complex that is situated on 2.26 acres of land. The property is currently being refurbished.
However, the complex, the anecdotal evidence suggests, has never taken off as a shopping centre, appearing mostly to limp along, especially after the financial sector meltdown of the late 1990s when crowds thinned from its formerly bustling food court.
Fair View Shopping Centre, in Montego Bay, on the northwest coast, comprises a series of buildings on a combined 101,000 square feet on 5.96 acres.
The shopping centre, which has become one of Montego Bay's busiest commercial and shopping hubs, hosts a branch of RBTT Bank, Super Plus supermarket, Palace Cinema's Multiplex, restaurants, hardware stores and other businesses.
The New Kingston properties were transferred to Cable & Wireless Pension Fund in 2003 from Finsac, the agency that was established by the government to bail out troubled and failed banks and insurance companies during the financial sector collapse.
Transfer settlement
The properties had fallen to Finsac when it pumped in cash to shore-up Life of Jamaica, which was subsequently acquired by the Barbados-based Sagicor. But it was because of matters involving another failed institution, Jamaica Mutual Life Assurance Company (Jamaica Mutual), why Cable & Wireless Pension Fund got the properties.
Jamaica Mutual used to own Mutual Security Bank (MSB), which it merged with National Commercial Bank (NCB) when it acquired the latter institution in the 1990s. Apparently, MSB had huge debts to the Cable & Wireless Pension Fund, which were still outstanding at the time to its former parent.
Finsac, which acquired the assets and liabilities of Mutual/MSB/NCB agreed to the settle the debts with the transfer of the properties.
Source:
Dionne Rose
Jamaica Gleaner
http://www.jamaica-gleaner.com/gleaner/20080716/business/business1.html
dionne.rose@gleanerjm.com
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