Tue | Dec 6, 2016

Jamaica finds second Chinese backer to close out Harmony Cove funding

Published:Friday | December 12, 2014 | 12:00 AM
Dr Lorna Simmonds, executive director of Harmonisation Limited.-Rudolph Brown/Photographer

Avia Collinder, Business Reporter

The Harmony Cove resort and casino project has finalised a deal with a Chinese equity backer and is now wrapping up a loan from a second Chinese financier for the first phase of the development which, at last estimate, will cost US$900 million.

Finance Minister Dr Peter Phillips did not overtly name the Chinese entities when he provided the update to the Financial Gleaner on Wednesday, but he has previously identified the equity partner as Sinohydro Corporation.

Phillips said the equity deal had "long" been concluded.

"The funding is the critical one," added Dr Lorna Simmonds, the executive director of Harmonisation Limited. "We have pretty much all the other elements in place," she said, while declining to confirm the identity of the two backers.

Simmonds, however, ruled out China Exim Bank as the lender.

Harmony Cove Limited is the project vehicle for a mega casino resort to be developed in Trelawny by state-owned Harmonisation Limited and private partner Tavistock Group. Jamaica has a minority 49 per cent stake in Harmony Cove, a project that was conceptualised initially by the Development Bank of Jamaica and National Housing Trust.

The project has amassed 2,300 acres of landholdings in Trelawny but the development has stalled for several years due to lack of funds.

But now Simmonds says most of the ground work is close to being finalised. "The funding is the critical one. We have pretty much all the other elements in place," she said.

Earlier this year, a group of Jamaican investors - comprising National Commercial Bank, Sagicor and National Insurance Fund (NIF) - began to signal that they may be willing to take up the slack, but Simmonds said a deal for that group is off the table for the phase-one programme.

Simmonds said Harmonisation will likely reach out to the local consortium with other proposals after the agreements with the Chinese have been finalised for phase one of the project.

The local group were said to be considering investments of US$30 million in the project. The top executive of NCB, Patrick Hylton, is the current chairman of Harmonisation, while the CEO of Sagicor Group Jamaica, Richard Byles, is a past chairman. NIF is a state-run pension fund.

Harmony Cove is one of two bidders seeking authorisation to develop casino resorts, which would require the company to build at least 1,000 hotel rooms in phase one and another 1,000 rooms in a second phase of the development.

The mega-resort is designed to include golf courses, marina facilities, commercial developments, luxury hotels, and private residencies. The plans also include a casino, convention and entertainment centres, restaurants and retail shops.

avia.collinder@gleanerjm.com