KINGSTON — The transformation of downtown Kingston is rapidly gathering momentum, as evidenced by over 300 percent increase in expressions of interest in the tax incentive programme for urban renewal by interested investors, over the last 18 months.
This was disclosed by the General Manager of the Urban Development Corporation (UDC), Joy Douglas, as she outlined the investment opportunities in downtown Kingston, at a UDC/Scotia Investments Forum at the Jamaica Conference Centre on Thursday September 22.
Ms. Douglas said that other manifestations of the surge of interest in the area, included the renewed interest of existing property owners in their properties, because of increasing property values, and what has been described, in some quarters, as a ‘grab on for lands’.
The UDC boss described the forum as an activity geared towards advancing the development of the capital city, and putting forward solutions to getting there. She explained that working with stakeholder partners, the UDC has been making significant progress in designing elements of the physical landscape, as well as creative funding methods for downtown Kingston.
She expressed confidence that the concept will find favour with most persons, and “should begin to open our minds to investment possibilities."
Ms. Douglas noted that, to a large extent, interest has already been “staked in most if not all parcels of lands along the downtown Kingston waterfront." She disclosed that, as a result, some of the major activities are expected to unfold over the next 24 months.
These include: the refurbishment of UDC developed structures along the waterfront; development of a hotel and apartment complex on the old Myrtle Bank property; the construction of the Ministry of Foreign Affairs office building on the site of the current Police Area 4 headquarters; and relocation and construction of a state-of-the art police facility, along the west end.
In addition, there are plans for: construction of a major operational base for one of the leading security conglomerates; construction of a multi-level parking facility along Orange Street; and the development of low income housing solutions, under a pilot programme to test desirability and sustainability of the model proposed.
With respect to the downtown market district, Ms. Douglas explained that the build out and reordering of the market district will continue apace. She also stated that the development of UDC’s proposed new headquarters building, which will commence at the old Machado Complex, will feature the modern urban mix, including a food bazaar with a mix of food, craft, entertainment inset within a green space offering commercial and recreational opportunities.
Echoing the Finance Minister’s claim that the climate is now ripe for investments, Ms. Douglas observed that the macro-economic environment and emerging national business focus, should serve to “strengthen the comparative advantage of operators and investors downtown.”
On the low interest rate environment, she declared that this has put private capital on the hunt for a home with higher returns, and downtown Kingston has the room to accommodate the desire.
With respect to the tax incentive programme (TIP) for urban renewal she said that, “this facility effectively provides a subsidy for development projects, and allows for a higher retention of profits, even as companies improve the quality of their assets”.
“It also allows for diversified income streams, given provisions for tax free rental income for built or improved properties,” she noted.
She said that, in addition to tax benefits provided under the tax incentive programme, the advent of the junior stock exchange also provides complementary benefits for investing in the city.
Ms Douglas said that the proposed creation of an international finance centre downtown, would provide the necessary economic underpinning for sustainable implementation of the city’s development plans, while considerations to support the expansion of the information, communication and technology (ICT) sector could look at the benefits of operating in the special development zone.
With respect to the significant outlay of capital required to make the dream a reality, Ms. Douglas explained that the developments would be driven largely by private financing.
"Even as we seek to operationalise elements of the development plan for the city, we are mindful of the resource limitations of the corporation and the country. Our approach, therefore, speaks to the alignment of interests with possible use of the following tools: Public/Private sector Partnerships (PPPS); Real Estate Investment Trust (REIT); and Initial Public Offerings (IPOS),” she stated.
The investment promotion forum co-sponsored by the UDC and Scotia Investments, brought together the captains of industry and commerce in Jamaica, including Digicel, which is locating its regional corporate headquarters in downtown Kingston, Guardsman Limited, which is eying locating its local offices there, as well as ‘established downtowners’ Grace Kennedy, Scotia Bank and the Jamaica Stock Exchange.
The UDC’s boss expressed confidence that the main objectives of the Forum will be realized.
“While recognizing what the investment challenges are, we take a critical look at what opportunities exist, and seize those opportunities that can be rewarding, in spite of the challenges,” she opined.
By Allan Brooks, JIS Senior Reporter