Real estate newby Johnston Development breaks ground on first project
Johnston Development Group, JDG, a year-old company in which private equity outfit Dequity Capital Management Limited has a stake, is undertaking a $1.2-billion residential development in Kingston called Cardinal Residence.
It’s the first in a series of projects planned by the company, which is headed by Jamila ‘Kibebi’ Johnston, daughter of businessman Charles Johnston.
The newly formed Johnston Development Group is majority owned by Jamaica Fruit and Shipping Company of which Charles Johnston is managing director and chairman. Kibebi Johnston owns another 29 per cent and Dequity, which is owned by Kadeen Mairs, holds the remaining 20 per cent.
On Tuesday, JDG launched construction of the 1.5-acre Cardinal Residence project, which will comprise 36 studios, and 12 one-bedroom and six two-bedroom apartments. The price of the units will range from US$190,000 to US$450,000, which translate to $29 to $69 million.
“We went to market about two months ago and so far we’ve sold about 80 per cent of the units already to a diverse set of individuals, including retirees, young professionals, local and international investors,” Kibebi Johnston told the Financial Gleaner.
The overall investment in the development is $2 billion, inclusive of land and other costs. JDG is part funding the development, but the majority of the financing is being sourced from First Global Bank, in the form of a $1.2 billion that she said JDG would draw down on as needed.
“I have another business called Barcode Jamaica, but given that it’s in the entertainment industry it was badly affected during COVID. And so having wanted to move into real estate for years, I used the opportunity to get the business off the ground,” Johnston said.
“Kadeen and I found the property and decided we were gonna take the step to get the company off the ground. We purchased the property about March last year, and by December we got all our approvals.”
Cardinal is scheduled for completion in December 2023.
Already, Johnston is exploring the build out of other subsidiaries under JDG, including the formation of a property management company called JDG Properties, which will manage short-term rental properties and strata developments; real estate concierge and project management company, 360 Development; as well as a real estate investment trust or REIT, which will hold both commercial and residential properties in Jamaica and overseas.
“We already have our first client for 360 Development who wants us to build a commercial complex. That company will really work with property owners who don’t wish to take on development projects themselves. We will do everything from conceptualisation to completion,” she said.
But before that Johnston is looking to close on a residential joint-venture in Kingston and possibly a commercial development on which JDG hopes to begin construction in 2023. Funding for those projects have not yet been finalised.
“We are not able to say exactly where those properties are as yet, but we are actively working on them,” she said.