KPREIT hunting globally for distressed assets to buy
Published:Sunday | June 18, 2023 | 12:12 AM
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To get to its goal of US$100 million in assets by 2025, real estate investor Kingston Properties Limited is looking towards various overseas markets for distressed properties it can snag at cheap prices. Its focus is on Europe, the United Kingdom,...
To get to its goal of US$100 million in assets by 2025, real estate investor Kingston Properties Limited is looking towards various overseas markets for distressed properties it can snag at cheap prices.
Its focus is on Europe, the United Kingdom, Latin America, the Caribbean and the United States.
CEO Kevin Richards said the company is particularly interested in the opportunities in the UK at present time, given its political turmoil in recent times.
“This is a country that has had three prime ministers in a year,” said Richards. “To to us that is saying there is possibly distress,” he said, while also pointing to weakness in British pound amid the pressure of a failed budget.
Boris Johnson resigned as prime minister in 2022 amid pressure from within his own party over concerns about his leadership. His replacement, Liz Truss, exited six weeks after her plan to cut taxes for the wealthy amid a faltering economy raised hackles. She was replaced by the current occupant of Downing Street, Rishi Sunak.
Kingston Properties currently has assets under management totalling US$61 million.
Richards said the aim is to get to US$75 million by the end of this year and to US$100 million two years later. In cases where the company doesn’t hold majority ownership of the asset, it is still counted towards the 2025 target, he explained.
“... If we’re still managing it then it can count towards that $100 million target,” he said.
Alongside its hunt for distressed assets Kingston Properties will continue on its current track of investing in mixed use and commercial properties, particularly warehousing, a segment of the market that Richards said the company has found to be lucrative.
“We see the trend,” he said at the company’s annual general meeting on Tuesday. “There is a huge demand for warehouse space particularly in Jamaica, because there’s not a lot of inventory available.”
Kingston Properties’ next development project at Rousseau Road, near Cross Roads in Kingston, will boast 14 small-bay warehousing units. It will be KPREIT’s first greenfield project, which is being done as a joint venture with Relmac Construction.
Planning approvals are pending but the aim is to build and commission the warehouse by March 2024.
To finance its upcoming projects, the company is looking to various funding sources.
“We’ll have to find creative ways of raising funds and while we may go back to the market in another two years or so we could look at joint ventures or partnerships in the meantime,” Richards said.