Barita buys old ice factory from the Hussey family
Building out real estate business through affiliate
Barita Investments Limited appears to be cashing in on the ongoing property boom, building out its fledgling real estate investment business outside its core operations and utilising affiliated company MJR Real Estate Holdings Limited. The real...
Barita Investments Limited appears to be cashing in on the ongoing property boom, building out its fledgling real estate investment business outside its core operations and utilising affiliated company MJR Real Estate Holdings Limited.
The real estate company, which last month acquired the Eden Gardens Hotel property on the outskirts of the New Kingston business district for US$3.2 million, or more than $470 million, had also in March this year bought the former Kingston Ice property at Harbour Street in downtown Kingston for US$5.4 million, or approximately $795 million.
The purchase of the roughly 134,250 square feet of land situated on the Kingston waterfront from the Hussey family-owned Liguanea Lane Pharmacy, took place a week after MJR was registered on March 10.
The directors of MJR Real Estate Holdings Limited are attorneys Trevor Patterson and Dane Patterson, as well Barita executives Jason Chambers, Ramon Small-Ferguson and Malindo Wallace, with attorney and Barita legal counsel Stephanie Sterling as company secretary, according to Companies Office of Jamaica records.
Barita’s management has declined to comment on the acquisitions or to discuss its relationship to MJR at this time. The investment firm is itself majority owned by Cornerstone Financial Holdings Limited, a subsidiary of Cornerstone United Holdings Jamaica Limited.
In interviews with the Financial Gleaner in September, Barita officials alluded to both the nascent real estate portfolio it was building, among other dealings.
“We have been very public about our bias towards alternative investments in this climate. We continue to invest astutely in traditional assets – bonds, stocks, etc – but we believe that there is a very solid lane of opportunity in alternative investments and specifically, we have been looking at real assets, such as real estate. We did a good bit of shopping in that respect during the more uncertain period of the pandemic,” Small-Ferguson, Barita’s vice-president for asset management and research, said at the time.
He did not elaborate on the fast-growing stock brokerage and investment company’s real estate investment strategy.
In September, too, Barita issued an addendum to its recent APO clarifying several issues, including responding to questions raised in the Jamaican and Caribbean media about its off-the-books arrangements.
“Barita enters into various types of off-balance sheet arrangements in the ordinary course of business. Barita’s involvement in these arrangements can take many different forms, including without limitation: unitised fund products; holding senior debt in other unconsolidated special-purpose entities that is generally collateralised by private credit, real estate, and listed equities; and providing guarantees, loan commitments, and letters of undertaking on behalf of clients,” Barita said in the addendum.
It added that Barita enters into these arrangements for a variety of business purposes. The document noted that securitisation arrangements offer investors access to specific cash flows, and that risks created through the securitisation process and its unitised fund products offer direct exposures to different investment strategies based on the risk and return objectives, and other circumstances of investors.
“In relation to some of the aforementioned off-balance sheet arrangements, Barita plays several roles, to include investment manager, broker and fiscal/administrative agent,” according to the addendum to the prospectus.
Chambers, the company’s chief investment officer, added in an interview with the Financial Gleaner at the time that the off-book vehicles were being utilised by Barita to pioneer new structured market products outside of repurchase agreements. These products, he said, would be offered at a later stage to Barita’s investment clients.
“When you are pursuing new alternative investment strategies, the broker/dealer typically seeds the strategy with funding and over time, we offer the various opportunities to clients. We have seeded over $6 billion in alternative investment strategies. We are building a pipeline of opportunities and developing those pipelines to the point where it is appropriate to introduce them to clients,” Chambers said.
Small Ferguson added that coming out of the COVID-19 pandemic, Barita was looking at applying more creative financing solutions to benefit from the recovery of the economy, as well as to help with the recovery through the company’s role as a financial services provider.
Meanwhile, Hussey family spokesperson Christelle Harris told the Financial Gleaner that the sale of the old ice factory property is not to be taken as any indication of the family disposing of other assets in their property holdings. The Husseys also own the Terra Nova All-Suite Hotel in Kingston that is constructing a multibillion-dollar, high-rise condominium complex, The Residences, on Terra Nova’s property; as well as Everglade Farms, Hampden Estates in Trelawny, Discount Pharmacy, a dry-cleaning business and several gaming lounges in Kingston.
“The Residences at Terra Nova is proceeding according to schedule. Piling work is currently being done,” said Harris, a director of Terra Nova.