David A Shirley, chairman of KLE Group Limited, has revealed that under the company’s resort project Bessa Villas, 86 units are now on the real estate market in Jamaica with prices ranging from US$260,000 per unit for Oceanfront Condos to US$550,000 for River Condos.
The company is developing Bessa Villas in partnership with Sagicor Group Jamaica. The development is spread across eight acres of seaside and river-front property in the previously undeveloped north coast of Oracabessa, St Mary.
In remarks attached to audited results for year end 2020, the company said the resort project, Bessa, would mature in August 2021 and that funds resulting will be used in the capitalisation of the business and the funding of future projects.
The developers have been taking reservations for units since mid-2020, when permits allowed the start of the sales and marketing phase of the development. Construction began back in 2017.
Shirley told Caribbean Business Report that the project is estimated to be completed by December 2021, according to the project managers who report directly to Sagicor Investments as equity partners.
As chairman of the KLE real estate committee, Shirley has oversight of the sales and marketing for Bessa project, sitting on the Bessa Partnership Board along with KLE CEO Gary Matalon. The other directors are five Sagicor members and two KLE members.
“Sagicor has the responsibility of delivering the construction for the project; however, both companies have been working closely to ensure the success of the venture,” Shirley said.
Bessa has 86 units comprising 24 ocean condos priced between US$260,000 and US$600,000; 12 pool villas priced at US$795,000; and 50 river condos priced between US$260,000 and US$550,000.
Prices are subject to final approval of the Bessa Partnership Board. The group will meet in June 2021 to approve the final sales prices and the project return on investment.
“Once the project is completed and the real estate is sold, the property management rights will belong to KLE Group for the first three years with the option to renew, subject to strata approval. This will be a revenue opportunity for the company as KLE pivots into the hospitality and real estate industry,” Shirley outlined.
In comments made in the notes attached to its audited financials, the company said it has adopted a number of strategies to keep revenue coming for its restaurant operations, in spite of the regulations attached to the management of the COVID-19 pandemic.
KLE mainly operates restaurants under the brand Tracks and Records. The parent company has a 49 per cent shareholding in T&R Restaurant Systems Limited.
Several years ago, in a debt-for-equity KLE gave up a 51 per cent shareholding in subsidiary company FranJam to shareholder Josef Bogdanovich, who was already the largest shareholder in KLE group with 23.17 per cent of the company.
FranJam was formed to own, develop, manage and license Tracks & Records-themed restaurants, as well as manage the future growth, franchising and licensing of other Tracks & Records-themed restaurants.
The restaurant operator has introduced, for what directors describe as “the new norm”, promotions including “Flava on the Go”, “Curbside Pickup”, and “Pull Up and Tek Weh”, among others.
“Our current operating condition continues to be challenging due to the COVID-19 pandemic. But the company continues to operate one of the top casual dining chains in Jamaica with firm footprints in Kingston and Montego Bay”
During the year ended, the restaurant division also partnered with a number of delivery services including 7Crave, Irie Couriers, and others to drive revenue under strict lockdown conditions and in an effort to maintain the “keep your distance” stance which has been adopted globally.
The audited results for KLE Group Limited indicate that revenue for the year ended was JM$151.37 million, compared to JM$224.52 million at year end 2019.
After expenses, the company made an operating loss of JM$78.55 million, far worse than JM$4.1 million in 2019.
Restaurant operations ended the financial year on December 31, 2020, with a loss of JM$89.1 million. In 2019 the group recorded a net loss of JM$12.74 million.
Management said that despite the loss, the company maintains a favourable outlook from short to medium term and has the full support of its directors.
“We are hopeful that the containment measures associated with the pandemic will be lifted in mid-year (June). This hope is also bolstered by the COVID-19 vaccine, which started rolling out in the country in March 2021,” management also pointed out.
“Our current operating condition continues to be challenging due to the COVID-19 pandemic. But the company continues to operate one of the top casual dining chains in Jamaica with firm footprints in Kingston and Montego Bay,” management added.
The company’s location at The Marketplace in Kingston continues to be a premier hub in the restaurant chain.
Moreover, The Marketplace location has also undergone renovations which were completed in the 2020 financial year, management outlined. The shopping hub also launched a social media campaign from which the restaurant is expected to benefit.
They commented that the economic conditions in Jamaica continue to improve daily as the country battles the pandemic. Directors said they are maintaining a positive outlook because of the measures being undertaken by the Government of Jamaica.