Government plans to sell off just under $10 billion in assets held by the Urban Development Corporation (UDC) this fiscal year, including the sale of stake in a number of hotels.

According to the Jamaica Public Bodies Estimates of Revenue and Expenditure for the year ending March 31, 2010, the UDC is expecting to generate net profit of $6.1 billion after the inclusion of dividends, which is projected consequent on the sale of major non-core assets owned by as subsidiary, gain on disposal of investment properties and corporate taxes.

In its revenue statement, the UDC projected to earn $3 billion from real estate sales up from $134 million the year before and $943 million from gain on sale of investment property, while taxes would total $3 billion.

The public company, charged with the responsibility of urban renewal and development in specific areas geared at economic development, also identified the subsidiary from which it would receive $5.7 billion in dividends as National Hotels and Properties Limited (NHPL).

The total revenue expected to be earned from asset sales would thus yield $9.67 billion in revenue.

NHPL oversees Government interest of the hotel subsidiaries of the UDC, which include Bloody Bay Hotel Development Limited, which is operated as Grand Lido Negril by SuperClubs Jamaica, The Jamaica Pegasus, Ackendown New Town Development Company, which has held the majority stake in Sandals Whitehouse, Montego Beach (1975) Limited (Club Jamaica) and Kingston Waterfront Hotel Limited (Oceana Hotel).

Currently, the Government holds a 59.8 per cent stake in the Jamaica Pegasus.

The Pegasus is a publicly listed company, and based on the last closing price on the Jamaica Stock Exchange of $13.50, Government’s shares are valued at $968 million.

Sandals Whitehouse, which commenced operations in July 2005, was built at a cost of US$110 million. The Government held two-thirds of the company, although initially UDC owned 37 per cent while then National Investment Bank of Jamaica (NIBJ) owned 30 per cent.

It is not clear how many of the hotel properties Government plans to sell or if the UDC is in advanced negotiations for the sale of the entities.