Ashford W. Meikle, Staff Reporter
The property located at 8 Olivier Road near Manor Park which Cable and Wireless' Pension Fund recently bought for US$3 million. - JUNIOR DOWIE/STAFF PHOTOGRAPHER
CABLE AND WIRELESS' Pension Fund has paid US$3 million ($200 million) to acquire a small commercial complex at 8 Olivier Road, in the upper St. Andrew community of Constant Spring from the property management company, Dumbarton
Rock, the Financial Gleaner understands.
The property is just under an acre and abuts the number three hole of the Constant Spring Golf Course.
With a gross floor area of roughly 30,000 square feet, the complex houses a number of high-profile tenants, such the diplomatic office of the Delegation of the European Commission, auditors Ernst and Young, trademark attorneys Lex Caribbean, and operators of Highway 2000, TransJamaican Highway Limited.
NO RESPONSE
Up to yesterday, efforts to get a response from Cable and Wireless' Pension Fund boss, Phillip McLeish, were unsuccessful as he was said to be off the island. However, a source who is intimate with the transaction confirmed that the deal, which has been ongoing for some months now, was recently finalised when a third party, acting on behalf of the pension fund managers, took over the property management services from Dumbarton Rock.
"It's a good investment. The building is prime real estate. It faces the Constant Spring Golf Club [and] with Manor Park and Norbrook nearby, the location factor is amazing," said the source. "You have some very good clients so it won't be a problem collecting rent. Also, based on the location, I think the yield would be about 10 per cent, which, for a real estate investment, is a very good return. It's also an easy property to maintain."
The purchase is a the latest in a series of high profile real estate purchases which corporate pension funds have bagged in recent times. One example is Cable and Wireless' Pension Fund, which also owns the New Kingston Shopping Centre and recently purchased the nearby Towers on Dominica Drive in New Kingston.
"That's an excellent move on their part ... it's a great buy," real estate broker, Andrew Issa, told the Financial Gleaner. "Most pension funds have a percentage of their funds in real estate and I think that is prudent."
According to the real estate professional, "Most people are looking for an eight to 10 per cent return, and that Olivier Road property is a special property because it's in an area that is not business-oriented since Manor Park is more retail."
Issa noted that the Towers, which had several vacant offices, has witnessed a turn-around since the pension fund bought it. "It is filling out [with tenants] and they must be commended for turning it around."
