Stephen Facey, chief executive officer of Pan Jamaican Investment Trust (at podium)

Pan Jamaican Investment Trust, the Facey family-controlled conglomerate engaged in property development and investment, has secured prime real estate in New Kingston from the Jamaican government on which the listed firm is expected to develop a hotel and other commercial ventures.

Pan Jam will pay J$454.5 million for the 161,610 square footage in an area known as Knutsford Park, which stretches from Knutsford Boulevard to Oxford Road, but while chief executive officer Stephen Facey would not define the exact location for the hotel project, tourism and real estate sources said it likely encompasses the property that now houses a state-operated children's home.

Mixed-use complex

Facey said Tuesday that the site would be developed into a mixed-use complex.

"It is early days yet and we are not ready to disclose the details, but we hope to break ground on the development by early next year," he told Wednesday Business.

Minister of Information Daryl Vaz, who announced the land sale to Pan Jam last Wednesday, said the property would be used for various developments including hotel, retail and recreational facilities, offices and residential space.

"A city hotel and residential apartments will be the bulk of the development with some small commercial space," Facey confirmed.

Facey noted that the development is not being done just by Pan Jamaican but as part of a syndicate which includes three foreign companies - Costa Rica-based Promerica Group; Moutte Capital Limited of Trinidad and Tobago; and Caribe Hospitality, a hotel development and asset management company with a presence in Central America and the Caribbean.

While Facey did not disclose the exact details of the arrangements, he said the hotel to be developed will be operated under the Marriott-brand. Sources had initially said a Courtyard franchise - a brand owned and operated by Marriott, was in the works.

Pan Jamaican, which is 43 per cent owned by the Faceys, has holdings that spread beyond real estate to financial services, retail and manufacturing, and insurance.

The company owns 73 per cent of First Jamaica Investment Trust Limited (FJI) an investment-holding company, which has a 25 per cent stake in Sagicor Life Jamaica.

The company's penchant to bet on winners, in which it takes minority positions, has reaped consistent profits for the group, whose net income so far this year is up 40 per cent at $1.4 billion over three quarters ending September 2009.

The norm

It is the norm for Pan Jam's profits to outpace its top-line income, which in the current nine-month period was $1.1 billion. Its profits swell beyond revenue intake because of its 'share of results of associated companies', which in the review period amounted to $921 million.

The size of the current investment to be made in the New Kingston venture remains a closely held secret, but part of the financing, Facey confirmed, will come from the US$25 million (J$2.2 billion) wad of cash sourced by subsidiary First Jamaica from World Bank International Finance Corporation last year.

Facey said then that the loan funds would finance projects in Jamaica and elsewhere in the Caribbean, but indicated at the time that Pan Jam was still looking for deals to draw down on the cash. The funds to FJI were not approved for a specific deal but for the development of real estate projects as they materialise.

IFC documents had also revealed that residential and commercial properties in Kingston were under consideration.

The planned-development in the New Kingston area will come in direct competition with other established hotels in the area such as The Jamaica Pegasus, Hilton Kingston, and the Courtleigh, as well as the nascent Spanish Court Hotel.

Additionally, one of Jamaica's top hoteliers, Gordon 'Butch' Stewart, is also to develop a property said to be on the same strip and a block away from the Faceys' intended project.

sabrina.gordon@gleanerjm.com

Maurice Facey, chairman of the group. - File