PanJam gets hotel approval
HOTEL DEVELOPER and investment company PanJam Investment Limited has got the go-ahead to build a hotel in Montego Bay, but the property and investment conglomerate is yet to disclose details of the project’s execution.
The approval comes while the hospitality market is still attempting to recover from the pandemic, and the future of business travel remains uncertain.
“We continue to evaluate our options and will inform the market when we have updates,” PanJam said in response to Financial Gleaner queries on the environmental permit being granted for the development.
National Environment & Planning Agency, NEPA, granted the permit in September “for the construction and operation of hotel or resort complex of 51 to 500 rooms” on three lots at Montego Freeport in Montego Bay. PanJam will execute the project through Baywest Development Limited.
PanJam first spoke of plans to develop a hotel and shops at Montego Freeport in 2018, having acquired six acres of land for the project.
The hotel intended to target business travellers in a resort city that’s mostly focused on vacationing tourists. PanJam executives, in explaining the value proposition i n 2018, said most hotels on the north coast are all-inclusive, which represents a mismatch in value to business travellers that work outside the property during the day, when meals are served, and want to sleep at nights, when entertainment begins. The hotel would seek to capture those managers and executives that work in the BPO/call centre market, they said, but would also cater to cruise ship visitors, by incorporating retail space for shops on the grounds.
Since the pandemic, which began i n March 2020, t he business travel market has gone through adjustments, with online meetings becoming the norm. The long-term effects are still unclear, but going forward it could result in fewer business travellers.
PanJam is already an investor in the hotel sector, but its holdings are located in Kingston. They include Courtyard by Marriott in New Kingston, and ROK Hilton, which is expected to open for business by year end at the site of the former Oceana Hotel that PanJam acquired and redeveloped.
Tourism is one of the two top earners of foreign exchange for Jamaica, the other being remittances. With the onset of COVID-19, the sector was virtually shut down, with 90 per cent of hotel workers losing their jobs at the time, according to Government data released last week. The data showed that since the onset of the pandemic, 4,600 rooms were taken out of circulation, reducing the total accommodation to 28,175 rooms in 2020. With fewer rooms to compete with, this would, in theory, make the prospect of entry into the sector easier. Hotel occupancy, however, still hovers at just over 50 per cent for major hotels, compared to the 75 per cent average occupancy levels prior to the pandemic.
PanJam made net profit of $1.3 billion for the June 2021 quarter, up 160 per cent year-on-year, but lower than the $3-billion profit in the June 2019 quarter.
PanJam, in its earnings report, cited concern regarding the surge in summer COVID19 cases, but reasoned that vaccinations should lead to a path of recovery.
“We continue t o believe that successful vaccination of the majority of Jamaicans is the quickest way to economic recovery. As such, we encourage everyone to get vaccinated at their earliest opportunity,” the company said.