Sun | Sep 24, 2017

KPREIT buys warehouse complex

Published:Friday | January 20, 2017 | 1:03 AMSteven Jackson

Kingston Properties Limited (KPREIT) disclosed the acquisition of another property, this time in Jamaica, and its second purchase for this month.

The real estate investment trust said it paid US$4.5 million for both acquisitions, one located in The Cayman Islands and the other in Kingston, but did not disclose the individual prices.

The company said it now controls 30 properties, which includes buying blocks of apartments in the complexes, particularly in Florida.

"A total of US$4.5 million was spent on the acquisition of both properties, which was financed using bank debt from institutions in the US, Jamaica, and the Cayman Islands in both US and Jamaican dollars," said Kingston Properties CEO Kevin Richards on Thursday in a release responding to Financial Gleaner queries.

Interest rates on the US dollar debt ranged between 3.25 and 4.0 per cent annually, while the rate on the Jamaica dollar facility was 9.85 per cent per annum.

"The acquisition bolsters KPREIT's strategy of increasing its geographic diversification. The Cayman acquisition was its first in that market.

THIRD OFFICE COMPLEX

With the Kingston purchase on January 18, Kingston properties added another warehouse and office complex to its portfolio, its third to date. The new complex at Spanish Town Road is currently leased to manufacturers.

The Cayman property, acquired on January 10, is a fully tenanted, mixed-use building located in the West Bay Beach area. The building comprises offices, retail outlets, and residences along the famous Seven Mile Beach corridor. Richards previously said the acquisition price would be disclosed in financial reports later this year.

Kingston Properties' portfolio of assets is now split 54 per cent in the United States, 32 per cent in Jamaica, and 14 per cent in the Cayman Islands.

"KPREIT will continue to seek out properties with upside potential in property values, as well as properties with stable, hard-currency rents in keeping with our mandate to continue to improve shareholder value," said Richards.

Its strategy continues to focus on commercial rentals in Jamaica and residential rentals in hard currency markets.

Last April, Kingston Properties raised some US$5 million in loans to finance acquisitions.

steven.jackson@gleanerjm.com