Jamaica Contractor General blasts Minister for ‘influencing’ sale of property

Minister without Portfolio in the Ministry of Economic Growth and Job Creation, Daryl Vaz –

(Jamaica Gleaner) An investigation by the Office of the Contractor General (OCG) has singled out Minister without Portfolio in the Ministry of Economic Growth and Job Creation, Daryl Vaz, for strong criticism in relation to the divestment of the Rooms on the Beach Hotel and beach lands in St Ann accusing him of undue influence.

The hotel was sold by Montego Beach Limited to Puerto Caribe Properties Limited as well as the beach lands were sold by the Urban Development Corporation (UDC) to the Puerto Caribe Properties Limited in 2017.

Montego Beach Limited is a wholly owned subsidiary of National Hotel and Properties Limited, which is a wholly owned subsidiary of the UDC.

The OCG report, which was tabled in Parliament yesterday afternoon, states that a sale price of US $9.3m was initially put forward by the UDC however the UDC Board approved and divested the properties at a sale price of US$7.2m.

“The lands were sold below market price and the Government did not optimise income from the divestment process,” the report read.

According to the OCG, the UDC was unable to negotiate freely and from a position of ‘strength’ with Puerto Caribe Properties Limited because of the direct involvement of the Vaz, and other state agencies.

The report notes that Vaz denied the claim.

“Notwithstand-ing, the OCG notes with reference to the 486th Meeting Minutes of the Board of Directors of the UDC, that the Honourable Minister Daryl Vaz advised the meeting that should there be any matter needed to be dealt with urgently that it should be brought to his attention and he would have it dealt with, which points to how pivotal the Minister’s role was to the divestment process,” said the report.

“It is the considered opinion of the OCG that the GOJ applied an excessive and generous discount towards the Beach lands (Mean Value of US$3.5M) to Puerto Caribe Properties Limited as no market value consideration was placed on the land when it was included in the Sales Agreement,” it added.

According to the report, the Ministry, through the negotiation process, surrendered its position of strength, that is, to negotiate a price close to market value but instead did completely the opposite in the name of attracting an investment.

This, the OCG argued, had the effect of depriving the country of revenue and the integrity of the revenue was not preserved.

The UDC was also criticised for its role in the divestment.

“The UDC must be singled out for failing to stand its ground by way of the recommendation of the sale price (US$9.3M) which was also excessively discounted, and in fact revising their recommendation to US$7.2M, the resultant effect of the Beach land being sold for very little consideration or value, notwithstanding that the mean value of the Beach land was US$3.5M.”

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