First Rock buys $1.6B stake in Cayman complex
Published:Sunday | December 22, 2024 | 12:07 AMNeville Graham - Gleaner Writer
In a deal worth $1.6 billion, First Rock Real Estate Investments has acquired a stake in a commercial complex in the Cayman Islands.
It’s the largest transaction in that territory for the Jamaica-based group. The company secured a majority stake in the Crown Square Commercial complex and an adjacent commercial tower. The acquisition was carried out through its subsidiary, that trades as FirstRock Capital Cayman.
First Rock Group Executive Chairman Ryan Reid says the company has been working “quietly” on this transaction for roughly nine months, having signed the agreement a few months ago and has finally closed, having received the requisite licences.
“This represents the largest transaction for FirstRock Real Estate Investments to date and aligns squarely with our shift towards further regional diversification outside of Jamaica and primarily assets with stable income generation,” Reid told Sunday Business.
The transaction, which was financed by Cayman National Bank, is a significant step in First Rock’s ongoing efforts to diversify and expand its real estate portfolio in the Cayman Islands and other markets in the Caribbean and Latin America, the company says.
The Crown Square Commercial complex is located in George Town, the capital city of the Cayman Islands. The company says there is robust demand for both retail and office spaces. The acquisition boasts prime tenants including agencies of government, as well as a communication tower, which is fully leased to Digicel, a leading telecommunications provider in the region. Crown Square Limited are the previous owner.
First Rock Real Estate Investments Limited, is a Jamaican-listed real estate development company with a subsidiary in the Cayman Islands.
Its other noted investments in Cayman include a 21,000-square-foot commercial property in George Town. The property is fully tenanted with long-term leases and is expected to generate almost US$1.0 million in annual rental income. First Rock also acquired an interest in the Kailani Hilton Cayman, a boutique hotel, from the NCB Group, Cayman.
In 2021, FirstRock made its first investment in Cayman, acquiring luxury residential units on a seven-mile beach in Grand Cayman. The company subsequently sold all its units for close to US$4 million dollars.
The deals do not always reflect positively on its bottomline. For instance, FirstRock Real Estate Investments Limited recorded a net loss of some US$674,540 for the three-month ended September 2024. Earnings per share, EPS was negative US$0.002. Net loss for the nine-months ended September 2024, totalled US$1.45 million, yielding an EPS of negative US$0.005.
The company says the results were driven primarily by unrealised foreign exchange losses on translation of foreign currency denominated liabilities, which amounted to some US$72,030 for the three months ended September 30, 2024, and US$275,170 for the nine months ended September 30, 2024.