Susan Gordon, Business Reporter

Jamaica National Building Society (JNBS) has wound up its real estate subsidiary, completing the lockdown on Wednesday, but has redeployed staff to other jobs in and outside the group.

JN Real Estate Company Limited (JNREC), run by Jacqueline Peat-Smith, was the casualty of a decision by JNBS bosses for the mortgage company to return to core business.

"For strategic purposes, especially since our mortgages are fed by real estate, it was suggested by the parent company that we operate in harmonisation with the real estate companies rather than competing with them," said assistant general manager Llewelyn Bailey. No other subsidiary is affected.

Bailey said some staff and operating space of the 25-year-old company were channelled into other areas of the group, and that the building society, Jamaica's leading private mortgage lender, incurred no losses as a result of the closure.

Of the 17 employees, 15 are being absorbed elsewhere in the JN group and two are retiring.

JNREC General Manager Jacqueline Peat-Smith has also been offered a new post.

"She has been offered an overseas position in New York, but failing her acceptance of that we still start of with an initial contract arrangement in Jamaica," said Bailey.

"She is an asset, and we want to retain her."

The company's 650 property listings are being referred to other realtors.

JN Real Estate was formed in 1982 after JNBS decided to go after what it considered a lucrative market - its members then, especially those living overseas, were seeking to purchase properties in Jamaica and needed agents.

JNREC offered property sales, purchases, rentals and property valuations services in three locations islandwide, with the head office posted at 26 Trafalgar Road, New Kingston.

Bailey said that although the subsidiary was established to complement the building society, "we realised we were straying from our core business and we were not in it for profit."

Not disclosing how much JN Real Estate contributed to the group, the assistant GM said only that the business was sustaining itself. In 2004/05, according to the building society's annual report, JNREC contributed $1.2 million to group results. That figure, however, was down from the $1.8 million profit the year prior.

"When we met we looked to see if the business had to be subsidised," said Bailey, who sat on the JNREC's board.

"It was doing well enough to sustain itself, but if the main criteria would be to contribute a profit, it would not satisfy that."

JNBS opted for closure over selling the business, saying it would not want the activities of the new owners to be associated with its former parent.

It continues to issue letters to clients about the lockdown, and is making referrals to other realtors on an ad hoc basis.

We haven't fully worked that out yet," said Bailey, adding that JN Real Estate already had a co-broker relationship with some of the real estate companies but was still refining its list for referrals, with permission from its clients.

JNBS will be housing house its audit department and other divisions in the space used for the real estate company.

The 15 sales staff of JN Real Estate has already been absorbed by other real estate companies, while the other eight employees are being deployed to other areas of the building society.

susan.gordon@gleanerjm.com