Sagicor buys third hotel

[Mosiah]

Sagicor buys third hotel
Saturday, February 23, 2013


SAGICOR Life Jamaica has acquired a 225-room beachfront hotel to add to its Jewel Resorts all-inclusive portfolio.

The Salem, St Ann property, which is currently operated under the Royal Decameron brand and which was previously operated by SuperClubs, is the third to be bought by the life insurer in three years.

Sagicor assumed operation of the Jewel Dunn's River property in Mammee Bay, St Ann in 2010, and last April opened the family all-inclusive Jewel Runaway Bay Resort with the 18-hole championship golf course.

The acquisition also brings the total number of rooms under Sagicor's management to 741.

The company plans to refurbish the rooms and main guest areas, and expects to start operating the property as an adult-only resort next winter season, which begins in December. The product offering will be focused on healthy lifestyle and sports.

Decameron will continue to operate the hotel as a family resort until the end of summer.

"This acquisition increases our investment in the hospitality sector during a period where there are very attractive properties being offered at reasonable prices with great potential to the market," said Richard Byles, Sagicor Life president and CEO.

The hotel is being bought through one of the Sagicor-managed real estate funds.

"The tourism sector is a major growth area and foreign exchange earner for Jamaica, and offers Sagicor the opportunity to further diversify its investment product offerings," said Rohan Miller, chief investment officer at Sagicor Life.

Currently, the hotel features a beachfront location, water slide, tennis and basketball courts, three swimming pools, three bars and four restaurants, fitness centre, three whirlpool hot tubs and a nightclub.

A water park is also being designed for construction at the Jewel Runaway Bay property.


Read more: http://www.jamaicaobserver.com/news/...#ixzz2LgEUcHUO

[Mosiah]

Isn't this the sort of thing that contributed to the financial meltdown in the early 1990's and FINSAC?

[Assasin]

How so? If it profitable and they know how to run it, it is no problem.

Look on all the things Butch dabble iinna like Appliance Traders, Sandals, Car dealership, Observer just to name a few.

Currently the company I work with just by out profitalbe companies, we have so many divisions. They keep ther profitable ones and sell some.

[Assasin]

Sad that they turn this property in an adult only property. Know it for a long time and stayed there. W asn't the big all-inclusive but was unique and kept their price competitively.

[Islandman]

Workers,Mutual Life, Eagle, LOJ, Century, they all dabbled in investing in others sectors with peoples deposits and got burnt.

Some organizations can pull it off, many cannot. Wish Sagicor all the best though, we need the investment from local companies.

[Assasin]

As HL will telll you it is about the homework. Right now you even have a lot of Jamaican pension fund owning hotels in Ja.

If the homework is done investing into other sector can be good just like how Grace Kennedy, Sandals, JP and others do. The problem only comes when it is impuslive buying without doing due dilligence, Some thing I am learning myself.

Yeah man of those companies you named did that but others invest in other sectors than their core sector all the time and it pans out.

What would you say is GE core sector?

[Islandman]

Remember though there is a difference between investing passively like a fund would do, and actually running the operation.

Sagicor looks like they are building up a portfolio, it can work if they have the right management in place. Yes some companies become great holding companies over a variety of sectors , GE is probably the best multinational example of that. Most bankers should stick to banking though, they are not entrepreneurial by nature.

[Assasin]

"Remember though there is a difference between investing passively like a fund would do, and actually running the operation. "

That maybe true in most cases, but as you said having the right management in place people in place is key as they will do their homework. With a hotel, some of the key is buying for the right price, keeping operation cost down and most important to be able market it. You can't just buy it to hold it.

If a hold you a go hold it, you might as well buy land.

[Mosiah]

How short our memories!

All sorts of companies started getting into properties in the late 80s/early 90s. Even photocopy giant Xerox Ja started buying property around then and they certainly got burnt for it.

So don't act as if my email is something taken out of left field, Sass. This is a basic lesson in any management course.

[Assasin]

Mo it had more to do with the speculation and people thinking they could make a quick money, same like what happen in the US not so long ago. It is not about forgeting nothing, it is about people not doing there due dilliegence and buying to sell as price go up. Most had no idea how to run hotels and think they could make a quick buck,

How did I act like your email taken out of context? I ask a question as you do of me all the time. I also shared my opinon, what is wrong with that?

[Assasin]

Iman and Mo(if you want to reason) what is the difference between what these people are doing and what Lee Chin is doin? Taking over Flow, NCB, Trident and now wanting Blue Mountain Coffee??

[Willi]

Yes...

[Time]

Isn't this the sort of thing that contributed to the financial meltdown in the early 1990's and FINSAC?

Yes. Also the US banks (and Savings and Loans) got burnt twice when deregulation allowed them to do every type of banking instead the specialized banking. Too muck risk.

[Mosiah]

nothing. everyting criss!

[Islandman]

One has investing and capital formation as a core competence, the other has financial services as a core competence.

It doesn't mean that Sagicor will fail in the hotel sector. What I m saying is that generally speaking banks and insurance companies tend to run into trouble when they try to get too creative with their investments. Stick to the fundamentals and let the entrepreneurs do what they do best.