First Union's $500m plan to diversify - Real estate development, pest control added to portfolio
First Union Financial Group Limited (FUFG) has built new headquarters and launched into a new line of business, the development of real estate, all under a half-billion-dollar plan to grow the operation at home and abroad.
The new offices at Eastwood Park Road in Kingston represents $275 million of investment, says Group Chief Corporate Executive Nicole Jenkins.
First Union, which began as a microlender at its core before diversifying into other lines of business, will move into its new home by year end, relocating from the current headquarters at Barbados Avenue in New Kingston.
The new 10,000 square-foot building will also house subsidiaries of the 17-year-old outfit, including a new real estate business, First Union Homes, which plans to develop residences targeted at middle-income buyers, and a pest-control operation. They were concretised under the group's ongoing expansion programme.
"First Union Financial Group has a three-year expansion plan which commenced in 2015, consisting of a budget of approximately $500 million," said Jenkins.
"As mandated, our permanent corporate headquarters has been completed in one year and six months. Additionally, the expansion budget is being expended in areas that will strengthen our subsidiaries, particularly into our newly established companies such as PinkCat Pest Control Services and First Union Homes."
Jenkins says PinkCat is licensed as a pest control operator by the Pest Control Authority.
"To aid in our efficiency, we use a well-defined integrated pest management programme to help eliminate or drastically reduce the use of pesticides, as well as to minimise the toxicity of and exposure to any products which are used. A wide range of services are available for pre-construction and post-construction treatment," she said.
First Union's holdings now include First Union Financial Company, Union One Express, eMac Office Systems, First Union Homes, PinkCat Pest Control Services, HomeFox and Union Point Corporate Options. The company is owned by Lloyd Campbell.
The flagship operation, First Union Financial, started in 1999. It now has a network of 14 branches spread across main towns nationwide, four of which are in Kingston.
The holding company, FUFG, hired Jenkins in 2015 to increase management oversight of the group. She told Sunday Business that the expansion plans go beyond the company's home market.
First Union plans to deepen its footprint in Guyana, where Union One Express - an online shopping and delivery service - already operates.
"We are currently working on our licence that will allow us to carry out our First Union Financial Company operations there, being able to offer alternative financing to the local public," Jenkins said.
Union One is also planning to enter new markets in Trinidad & Tobago and Suriname, according to information on its website.
First Union Homes is currently engaged in a joint venture project for an apartment complex in Barbican, Kingston, which Jenkins said will soon come to market.
"The aim of First Union Homes is to build and provide middle income housing throughout Jamaica in the years to come ..." she said.
Its first project was the First Union corporate headquarters, done in collaboration with Lexington Homes Limited. The interior layout and design was executed by eMac Office Systems Limited and Addon Irons.
Amid the large capital outlay by First Union, Jenkins asserts that the microlending outfit is performing well.
"Rates and fees are trending down due to the implementation of new and diverse technologies which enable us to lower our operational cost therefore giving us an acceptable return on investment," she said.
"Last year was a profitable year...," she added, but would not disclose the company's portfolio size and earnings.
Jenkins said the funds for expansion were secured "thanks to" various state agencies.