Bank of Jamaica details $420m consultancy spend expansion plans

The Bank of Jamaica (BOJ) will pay out $420 million for consultancy services to flesh out plans for the expansion of its location at Nethersole Place in downtown Kingston, Governor Richard Byles has indicated.

In April, the BOJ issued a tender for architectural, civil, structural, mechanical, and electrical quantity surveying services for the construction of a “10-storey office building and parking facility.”

Responding to questions from reporters at its quarterly monetary policy conference on Monday, Byles said so far, the cost for all the technical work “is estimated at $420 million, and that is what we have put to the infrastructure committee of Cabinet.”

BOJ Governor Richard Byles

Having also purchased the former French embassy on 13 Hillcrest Avenue in St Andrew for US$7.965 million ($1.25 billion) from Sygnus Real Estate Finance Limited (SRF), the BOJ is also planning to undertake retrofitting of that property as it seeks to boost the bank's ability to respond to potential disruptions by relocating some its operations.

“In the last two years, the risk of earthquakes or storm surge has come home to us in a very acute manner," Governor Byles said.

The acquisition of the Hillcrest Avenue property is to protect critical central banking functions that underpin business and government operations in Jamaica, as well as to minimise the chances of a complete operational shutdown.

"The location of the bank on the Kingston waterfront makes it particularly vulnerable to geological activities such as earthquakes and to the potential effects of sea level rise either by itself or resulting from an earthquake or storm surges driven by tropical cyclones," Byles was previously quoted as saying. 

“We have said to ourselves, ‘We have to make preparations for it.’ Where we are now is not adequate in many respects and so we started to hunt for solutions,” he said.

The BOJ also has another location “but it is in a very congested area,” George Roper, deputy Governor with responsibility for Finance, Technology and Administration, said. That location is also on the same fault line as Nethersole Place.

“In addition, there is very limited parking space on the land. We have to rent additional parking space for that location. Most importantly, we can’t operate currency operations [there] and in terms of the mission-critical function of the BOJ…we have to be able, as a modern central bank, to do our own currency operations and not depend on a third-party,” Roper explained.

“If we didn’t have that rented parking space, there would be one point of entry and exit and the footprint of the land just cannot accommodate another entrance,” Roper added.

“We have to have an effective set of arrangements to deal with business continuity…the Hillcrest location checked a lot of boxes. It is not on the same fault line as Nethersole Place. It is in close proximity to important services that we need hospitals, police station, telecoms providers and it has various entry points, he said.

For Byles, the Hillcrest property is “far superior.” While there is some development work that will be done to make the space fit for purpose, the costing for those services have not yet been broken out. Plans for the expansion of Nethersole Place are much more advanced.

“It has over 11,000 square feet and more than adequate parking. It is fine for us to house what we want,” Byles added.

Pressed on the timeline for retrofitting the new acquisition, Roper said: “Once we get a professional, we will have a detailed plan then we will be able to give a timeline.”

The BOJ received approval from Cabinet for the expansion of Nethersole Place last week. But nothing has been submitted for Hillcrest just yet.