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Palmyra placed into receivership
NCB owed most among creditors looking to recover loans to troubled high-end resort
BY JULIAN RICHARDSON Assistant business co-ordinator [email protected]
Wednesday, July 27, 2011
THE US$150-million Palmyra Resort and Spa in Rose Hall, St James has been placed in receivership by local banks owed hundreds of million of US dollars, highly reliable sources have confirmed with the Business Observer.
The receivership date was effective July 22, 2011.
The Palmyra
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National Commercial Bank (NCB) is said to be Palmyra's biggest creditor, owed US$88 million ($7.5 billion) in the financing of the high-end resort for which Business Recovery Services CEO Kenneth Tomlinson has been appointed to oversee the receivership.
The developers behind the The Palmyra Resort and Spa are Michelle Rollins' Rose Hall Developments and US-based Resort Properties Group, headed by businessman Robert Trotta. Efforts to contact Rollins and Tomlinson were unsuccessful while Trotta was said to be in meetings with NCB executives at the bank's Trafalgar Road headquarters yesterday.
A source said poor sales led to the hotel developers encountering financial troubles, which made it difficult for them to continue with the venture.
"It was overpriced," the source said about the resort, where prices for villas and condos ranged from US$451,000 to US$3.5 million when it just entered the local market a few years ago.
"A lot of these businesses come to Jamaica and don't understand the market," added the source, who said the upshot was that the Palmyra developers "...were in a whole lot of debt and it wasn't being serviced".
The development sits on 16 acres of pristine beachfront land at Rose Hall. Ground was broken on the project in 2005 for what was then billed as Jamaica's first luxury waterfront condominium resort for high-scale residential living and resort accommodation. The gated complex was expected to comprise 26 villas, three 12-storey condominium buildings with 630 luxury residencies and a myriad of recreational and health amenities. Additionally, it was expected to employ approximately 1,000 Jamaicans upon completetion.
NCB's non-performing loans — loans that have not been serviced for over three months — totalled $3 billion, or 3.45 per cent of gross loans, at the year ending September 30, 2010. The firm wrote off $660 million over the period — write-offs are made when all or part of a loan is deemed uncollectible or is forgiven.
RBTT Jamaica (rebranded Royal Bank of Canada) is also said to be one of the creditors after The Palmyra. A $2.66-billion impairment loss on loans and advances during the 19 months ending October 31, 2010, dragged the company into a huge loss position.
The parties involved are expected to issue a joint press release today.
Resort Properties was acquired by US development company Silverpoint Group Holding earlier this year.
NCB owed most among creditors looking to recover loans to troubled high-end resort
BY JULIAN RICHARDSON Assistant business co-ordinator [email protected]
Wednesday, July 27, 2011
THE US$150-million Palmyra Resort and Spa in Rose Hall, St James has been placed in receivership by local banks owed hundreds of million of US dollars, highly reliable sources have confirmed with the Business Observer.
The receivership date was effective July 22, 2011.
The Palmyra
1/1
National Commercial Bank (NCB) is said to be Palmyra's biggest creditor, owed US$88 million ($7.5 billion) in the financing of the high-end resort for which Business Recovery Services CEO Kenneth Tomlinson has been appointed to oversee the receivership.
The developers behind the The Palmyra Resort and Spa are Michelle Rollins' Rose Hall Developments and US-based Resort Properties Group, headed by businessman Robert Trotta. Efforts to contact Rollins and Tomlinson were unsuccessful while Trotta was said to be in meetings with NCB executives at the bank's Trafalgar Road headquarters yesterday.
A source said poor sales led to the hotel developers encountering financial troubles, which made it difficult for them to continue with the venture.
"It was overpriced," the source said about the resort, where prices for villas and condos ranged from US$451,000 to US$3.5 million when it just entered the local market a few years ago.
"A lot of these businesses come to Jamaica and don't understand the market," added the source, who said the upshot was that the Palmyra developers "...were in a whole lot of debt and it wasn't being serviced".
The development sits on 16 acres of pristine beachfront land at Rose Hall. Ground was broken on the project in 2005 for what was then billed as Jamaica's first luxury waterfront condominium resort for high-scale residential living and resort accommodation. The gated complex was expected to comprise 26 villas, three 12-storey condominium buildings with 630 luxury residencies and a myriad of recreational and health amenities. Additionally, it was expected to employ approximately 1,000 Jamaicans upon completetion.
NCB's non-performing loans — loans that have not been serviced for over three months — totalled $3 billion, or 3.45 per cent of gross loans, at the year ending September 30, 2010. The firm wrote off $660 million over the period — write-offs are made when all or part of a loan is deemed uncollectible or is forgiven.
RBTT Jamaica (rebranded Royal Bank of Canada) is also said to be one of the creditors after The Palmyra. A $2.66-billion impairment loss on loans and advances during the 19 months ending October 31, 2010, dragged the company into a huge loss position.
The parties involved are expected to issue a joint press release today.
Resort Properties was acquired by US development company Silverpoint Group Holding earlier this year.
is not looking good 
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