Hendrickson
Ashford W. Meikle, Staff Reporter
AFTER MONTHS of negotiations, a member of the Hendrickson family is close to acquiring the 720-room Jamaica Grande Hotel, Sunday Business understands.
"Yes, negotiations are going on; they are close to putting a deal together," a source close to the family confirmed yesterday.
The purchase of the Ocho Rios hotel would further strengthen the family's interests in the tourist industry and real estate acquisitions.
The Hendricksons operate the Courtleigh and Knutsford Court hotels in New Kingston. Their other properties include the 430-room Sunset Beach Resort and Spa (which son-in-law, Ian Kerr, is heavily involved in) in Montego Bay and the Negril resort, Palms at Sunset. They also own and run the Ruins Restaurant in Ocho Rios.
They also hold hotel interests in St. Lucia. Recently the family acquired the former Island Life Centre on St. Lucia Avenue for about $400 million from Dennis Joslin.
The source insisted that the deal was all but completed. "It's a complex transaction. But now it's just a matter of tying up loose ends." The source suggested speaking with Mr. Kerr who, it is understood, is involved in the negotiations. Sunday Business tried to contact Mr. Kerr several times but he was unavailable for comment.
When the Hendricksons were invited for a comment, a family member declined to comment saying, "I am not in a position to make any public statement." It is understood that the patriarch of the family, Karl Hendrickson, is off the island. The Hendrickson family owns and operates the Yummy bakery and Caribbean Broilers.
With 14 stories and nine meeting rooms, the Jamaica Grande Hotel is actually a merger of the Mallards Beach and American Hotel. The now defunct Century National Bank brokered that deal. With the largest business conference centre in the Caribbean, Jamaica Grande also boasts 13 restaurants and lounges and has 1,400 feet of beachfront access.
US$30-35 MILLION
A prominent player in the tourist industry estimates that the twin-tower property's overall value is around US$30-35 million. "But," added the hotel executive, "nobody is going to pay that for it." The room value of the hotel is approximately US$10.8 million. According to the tourist mogul, "the sale is a good thing. Jamaica Grande is the crown jewel in Ocho Rios but it needs reinvestment; it has liabilities." The uncertain state of affairs at the hotel concerns the complex ownership structure. There are three principal partners Financial Institution Services (FIS), which owns 49.44 per cent through its takeover of the Century Group. The remaining stakeholders are the U.S. hotel chain, the Marriott which owns 22.47 per cent and the U.S. travel agency, Kessner and Associates with 28.09 per cent. Interested parties have usually been turned off by the fact that if they acquire the Government shares, they still would not be the majority owners. But, with Kessner now prepared to sell, that obstacle now appears to be out of the way.
What is clear, though, is that regardless of who gets the hotel, the present management contract would be terminated. The Marriott Hotel manages the hotel which is described as one of the most profitable in the Marriott group. But, any termination of Marriott's lucrative management contract would involve substantial compensation for them.
