Susan Gordon, Staff Reporter

ISSA

The Couples Group is to build a new 370-room hotel in Trelawny, to be sited near the multi-billion Harmony Cove luxury tourism development that Government is now negotiating with foreign investors.

Couples has already signed a water supply deal with the National Water Commission that will link the property to the new Martha Brae system under construction, though work is yet to begin on the hotel property.

The hotel, an estimated US$57 million ($3.76 billion) investment, won't go to construction before next January, said Couples chief executive officer, Glenn Lawrence.

The figure includes the real estate, already owned by Lee Issa, head of Couples.

At that rate of investment, Couples will build the hotel at a unit cost of just over US$154,000 per room.

The hotel group just last month spent US$15 million (J$975 million) expanding another of its hotel properties, Swept Away, in Negril.

Lawrence said the group was in expansion mode, and looking to tap into the current boom in the tourism market in Jamaica and across the Caribbean region.

38-acre property

The hotel site is on a 38-acre property purchased from the Veira family of Trelawny in the mid-1990s by Lee Issa, Phillip Gore and Anthony Walker, through a company they formed called, Quality Incorporated. The ownership structure has since changed.

"The land just sat there until recently the House of Issa bought out Walker's and Gore's share of it," said the CEO.

Issa originally had a 40 per cent stake in the land.

Lawrence said the hotel would be financed from a mix of bank loans from FirstCaribbean International Bank and the Bank of Nova Scotia Jamaica, and internal cash flows generated by the group, which has a gross value of about US$140 million (J$9.1 billion), excluding future expansions and renovations.

"Realistically, I can't see anything happening before the beginning of next year," said Lawrence.

The hotel group was originally granted permission in 1997 to build a 230-room hotel, but those plans were put on hold because of the financial meltdown that began a year prior, a less than impressive tourism sector, and lack of some basic infrastructure, including water supply.

The plans were adjusted, adding 140 more rooms, to qualify for the Government's 15 per cent tax holiday for hotels of over 350 rooms, but also to derive economies of scale.

Lawrence said there was still some planning to do on the project, suggesting that some permits were still pending.

"There's quite a bit to do but we are not static," he said.

Though the CEO would not divulge the cost of the arrangement, he said Couples recently signed with the NWC to supply water to the property.

Swept Away Negril, which was initially a 134-room hotel, was expanded to 312 rooms - about two and half times its original size room capacity - over 18 months ending in July.

The group is also refurbishing Couples Ocho Rios, and the Sans Souci Hotel purchased last year from Carreras, to bring its hotel room count form 900 to just under 1,500.

The Trelawny project will boost room count in the group to 1,370.

Couples, which now has five properties along the North Coast, will next be branching out into the English speaking Caribbean once its Trelawny project is completed.