Ashford W. Meikle, Staff Reporter
Richard Byles, president and chief executive officer of Life of Jamaica Limited at the groundbreaking ceremony of the Winchester Estate in May. Looking on at right is Errol Wallace, General Manager of LOJ Property Management. - RUDOLPH BROWN/CHIEF PHOTOGRAPHER
WHEN THE final sale agreement is signed for Winchester Estate, insurance giant, Life of Jamaica (LOJ), will collect over half a billion dollars in revenue from the residential complex.
The company could earn as much as $200 million from the development as it is projected to cost about $300 million.
Winchester Estate is a gated apartment complex being developed by LOJ on some four acres of the former Jamaica Broilers land off Hope Road, a stone's throw from the busy Half Way Tree transportation and shopping hub of Half Way Tree.
The complex will consist of a mix of 20 studios, 30 one-bedroom and 10 penthouse apartments. It is expected that the residential development will be completed by June next year.
LOJ bought the land from Jamaica Broilers last year for about $115 million.
With the studios selling for $6 million, the one bedroom for $8 million and the three bedroom penthouses going for $14.5 million, LOJ stands to earn over half a billion dollars from the residential development.
THINGS WILL BE DIFFERENT
Winchester Estate marks LOJ's first major foray into the real estate market since the FINSAC meltdown when the company had to shed a huge portion of its real estate portfolio. In fact, it was LOJ's heavy investment into real estate - holding properties - which led to its financial woes, precipitated by its illiquid balance sheet.
But, this time around, things will be different. According to LOJ president, Richard Byles unlike its previous strategy, LOJ was more interested in developing properties rather than holding them,- which in a meltdown of the real estate industry can burn companies as FINSAC proved.
"In a low interest rate environment investment, managers must find creative ways of generating attractive returns," said Mr. Byles at LOJ's AGM last month as he sought to explain the company's decision to get into development.
Actually, the total project will also involve a separate commercial development, which will comprise small commercial offices.
In all, the total development - residential and commercial - will cover some 410,000 square feet and is expected to cost about $1 billion. The commercial construction will start later down in the year, with completion slated for the end of 2006.
