Sagicor confirmed Wednesday that it has now increased its shareholding in 138 Student Living to about 30 per cent — this as the student housing developer rapidly nears completion of more than 500 units for January 2016.

On Monday, Sagicor disclosed acquisition of a 14 per cent shareholding from K Ltd which has controlling interest in 138 SL.

However, by Wednesday it further disclosed that the total in 138 SL is now 29.05 per cent held; this being 11.06 per cent held by Sagicor Pooled Funds; 3.02 per cent by Sagicor Life Jamaica Limited, 11.06 per cent JCFS Trustee Services Limited-Sigma Optima and 3.92 per cent by Sagicor Pooled Mortgage and Real Estate Fund.

138 SL CEO John Lee said Wednesday that the company expects to begin seeing profit in September 2017.

But this month, however, it expects to begin seeing additional rental income from 504 units which will by then be completed. These include three blocks totalling 72 units at Gerald Lalor Hall and the 244 units in Block A and B which are now fully occupied.

The rental rate per unit is US$395 per month or $47,000 — covering rental, electricity, water, cable and internet use. More than 80 per cent of the units are occupied by non-Jamaicans, Lee said.

With the reduction of shares owned by K Limited — a company owned by the Lee family — to 41.2 per cent, Lee said that the concession arrangement with the University of the West Indies, under which 138 SL will finance, build and operate the student residences, has been tweaked with the UWI agreeing to the change in shareholding.

Previously, it was stipulated that the founder of the company, K Limited, must retain at least 51 per cent of the ordinary shares in the company.

For the year ended September 30, 2015 rental income reported was $11.99 million with operating expenses of $11.22 million. Net loss for the company was $244,628 or six cents per share.

138 SL, incorporated in Jamaica in August 2014 and listed on the main market of the Jamaica Stock Exchange after an IPO last year, was established to construct and rent living facilities at the University of the West Indies under a 65-year concession agreement.

The agreement was initially established between K Limited and the University of the West Indies on July 3, 2014, but transferred to 138 SL in November that year.

The terms of the concession agreement require the company to design, finance, construct and operate 1,584 units of student accommodation in three development phases in not more than 48 months.

More than 1000 units are due by August 1, 2016, with the remaining 432 units to be completed by August 2017.

In November, 138 SL also entered into a concession agreement with the University of Technology to build 600 rooms to commence July 2016, costing $2 billion over a two- to three-year period.

The company has a 100 per cent subsidiary, 138 SL Restoration Limited, which has a 35-year concession agreement with UWI for the restoration and reconstruction of selected traditional halls, including the Gerald Lalor flats.

Construction costs as at September 30 were $1.25 billion.

The concession agreement with the UWI allows for 138 SL to earn a 15 per cent real rate of return by the end of the concession agreement period, which is expected to be 30 years but is not to exceed 65 years. At the end of the period 138 SL is expected to transfer the residences to UWI.

The audited financials of 138 SL, the group released Tuesday, indicated that Block B and Block C were certified completed in September.

According to the report, the company has total financial assets of $577.73 million and total financial liabilities are $1,83 billion.

As part of the initial public offering in 2014, the company had offered 33,680,000 cumulative redeemable preference shares at $5.00 per share, later also offering an additional 848,000 shares.

Preference dividend for the years 2014 to 2017 will be accumulated and be paid in 2018 and annually thereafter with dividend yield indexed to the Government of Jamaica 180-day weighted average Treasury Bill yield plus a premium of three per cent.

In its latest financials, the company reported negotiating a loan from JCSD Trustee Services Limited and CIBC of $4.3 billion. Up to 30 September 2015, $3.3 billion was not disbursed.

Additionally, under an arrangement with Victoria Mutual Wealth Management and 138 SL Restoration Limited, it aims to raise up to $2.4 billion. The amount disbursed as at September 30, 2015 was $153.9 million.

138 Student Living will pay no dividend to shareholders until the student housing project is complete, but as of 2018, the company expects to start paying annual dividend on its ordinary shares equivalent to 95 per cent of net profit after debt servicing and funds for routine maintenance have been set aside.