Completes first investment lifecycle with 19.15% ROE

Speciality investment firm Sygnus Real Estate Finance Limited (SRF) says it has deployed J$15.49 billion in capital and exits totalling J$6.47 billion since inception.

At its third annual general meeting (AGM) on March 20, SRF reported a 19.15 per cent average return on equity (ROE) after its first investment lifecycle, surpassing its initial 12 per cent target.

The performance, according to the company, underscores its strategic execution and effective financial management, contributing to strong growth in the real estate finance sector. In December 2024, SRF also paid its first-ever dividend, marking a significant milestone in its journey to deliver consistent returns to investors and ensure long-term stability.

David Cummings, vice president and head of real estate and project finance, commented on the company’s performance and mission. “SRF has always been driven by its mission to provide flexible capital that helps unlock value in the real estate sector, and this year’s results reflect the dedication of our team in advancing this mission”.

“Achieving a 19.15 per cent return on equity is a direct result of our commitment to creating value for our shareholders while managing risk effectively. We are very pleased to have not only met but exceeded our initial targets, and the dividend payout marks an important step in our journey to build long-term wealth for our investors. Looking ahead, SRF is well-positioned to continue executing on its strategic goals, further expanding our real estate portfolio, and driving substantial growth in the years to come,” Cummings continued.

For the financial year ending August 2024, the publicly listed company reported a 49.0 per cent increase in net profit, reaching J$315.08 million compared to J$211.44 million in the previous year. Sygnus Real Estate Finance achieved a 62.7 per cent increase in net investment income, totalling J$508.50 million, driven by higher total investment income and a 27.0 per cent reduction in operating expenses, which amounted to J$330.74 million. Total investment income for the year was J$839.24 million, reflecting a 9.6 per cent increase from the previous year’s J$765.56 million, driven by gains in investment property and joint ventures. SRF raised J$3.38 billion through a dual-currency senior secured debt issuance, which increased to J$4.11 billion after an upsized facility. This capital will be deployed to fund further real estate investments and debt refinancing.

SRF made significant progress on several major strategic assets during the financial year.

The One Belmont project, a nine-storey office building developed through a joint partnership, achieved practical completion during the financial year ending August 2024 and is expected to add valuable income to SRF’s portfolio.

The Spanish Penwood industrial facility, the company’s first development project, was successfully exited and has generated its first full year of lease income, reinforcing SRF’s business model of unlocking value in real estate. The company continues to advance its 14-acre Mammee Bay beachfront property and successfully exited its Hillcrest Avenue asset in St Andrew.

Additionally, Lakespen Holdings in St. Catherine is moving forward with its industrial development, while 26 Seaview Avenue remains under evaluation for sale.

Executive VP Jason Morris highlighted the company’s strong financial performance, noting that it is a direct reflection of SRF’s strategic focus and the successful execution of key initiatives.

“SRF’s performance during its first investment life cycle underscores the success of our investment strategy, achieving a 19.15 per cent return on equity (ROE) and a net residual value to paid-in capital of 1.75x, meaning that for every dollar invested, shareholders saw a 75 per cent increase in value. The first dividend payment was made in December, further demonstrating our commitment to providing exceptional shareholder value. This strong outcome reflects disciplined capital allocation and strategic execution as we continue to drive sustained growth,” commented Morris.

Berisford Grey, president and CEO of Sygnus Real Estate Finance, provided insight into the company’s outlook. 

“SRF is on a strong growth trajectory, and we are confident in our ability to continue expanding our portfolio and executing on high-value investments. One Belmont and Spanish Penwood are key examples of the value we are creating, and we are actively working to unlock further potential in assets,” he articulated.

“The successful exit of certain investments and strategic sales further solidifies our position in the market. Looking forward, SRF is poised for continued success, with a clear focus on driving value for our shareholders while positioning the company as a leader in real estate finance,” added Grey.