THE Bank of Jamaica (BOJ) said it has now received approval from Cabinet to spend an estimated $420 million to hire a consultant for its planned development of a second tower on the eastern car park at its Nethersole Place, downtown Kingston, headquarters.

The approval, which was granted on Monday is for consultation fees in relation to the construction of a new 10-storey office building and car park for the central bank. The building is expected to add 80,000 square feet of space to the central bank to complement its current 14-storey headquarters which does not have enough space to hold the staff it needs to carry out its expanding role to regulate the entire financial sector instead of just deposit-taking institutions.

“Right now, we are not housing one-third of our staff, we can’t. In fact, we have leased some property in the Scotia building to house some staff. So we do need housing for offices as well as car park,” Richard Byles, governor of the Bank of Jamaica, told journalists at a press briefing on Monday.

He pointed out that the $420 million is to cover “the cost for all of the technical work which is the engineer and the architect and soil testing, and everything that goes into building a tower”.

The actual cost of the building itself is yet to be worked out and will depend on the design the consultant recommends. The identity of the consultant was also not disclosed because the entity is yet to be informed that it was selected as the preferred bidder.

Byles’ colleague, George Roper, deputy governor at the Bank of Jamaica with responsibility for finance, technology and administration, said the new tower will be similar to the current one, except that it will have fewer floors.

“The plan is the new building will have the same character, and if I might use — charm — of our existing structure here, and that really is the plan. We have to, in doing that construction also, be aware of the need for growth, whilst also taking into account, technological advances [from which] we are going to hopefully have some gains in terms of efficiency,” he added.

Apart from new offices and parking, the new building is expected to also have a new vault for holding cash distributed by the BOJ.

This new building, when constructed, will see the central bank migrating its staff from the space leased from Scotiabank to the new offices. Just last month, the BOJ started lease arrangements for two and a half floors on the adjacent Scotia Centre building for five years and has already moved 51 staff members onto one of those floors to work, with another 70 to 80 to be added when retrofitting work on the offices is complete. It is not clear how much the BOJ is paying to lease the offices in the Scotia Centre building, but at its other location in New Kingston, its financials show it paid $190 million in 2023 for lease up from $69 million in the prior year.

But while plans for the new tower are advancing, the central bank said it is still at “the embryonic stage”, when it comes to its new business continuity centre at the former French embassy on Hillcrest Avenue in Liguanea, St Andrew, which it purchased recently for US$8 million.

“What we need to do is to sit down here and say, what are those essential services that we can put up there and how does that fit into the existing building which is there. It’s a very substantial building, it’s 11,000 square feet, but it has to be retrofitted inside, because it will have a lot of computer equipment in there and we have to have offices for specialised persons and we have to have a facility to house a vault for currency distribution. That is still at the planning stage and we don’t have any idea of that cost as yet,” Byles added.

But the central bank said the rationale for getting a new business continuity centre surrounds risks, it says, that have presented themselves more in the last two years.

“The risk of the impact of earthquakes, storm surge, has come home to us in a very acute manner and we have said to ourselves that we have to make preparations for it. Where we are now is not adequate, not adequate in many respects, and so we started to hunt for a solution,” Byles added, referring to the New Kingston offices from which some back office functions are carried out.

“We have to have an effective set of arrangements to deal with business continuity. And as the governor pointed out, we do have another location. That location is in a very congested area. Reportedly, it’s on the very same fault line as Nethersole Place which is the centre of our operations, our primary location. In addition, very limited parking space on the land, we have to rent additional parking space for that location and, most importantly, it can’t accommodate currency operations, and in terms of the mission critical of the bank… its currency,” Roper pointed out.

He said the location on Hillcrest Avenue checks a lot of the boxes for the central bank, apart from not being on the same fault line as the BOJ headquarters.

“[It is in] close proximity to important services that we need: hospitals, police, telecommunications, various points of entry-exit,” Roper continued. He said the property gives the BOJ another advantage with it sitting on 3.2 acres of land versus the one-eighth acre the New Kingston property currently sits on.

“So this is far superior. There are some development work that has to be done. The hope is that we will have a centre that supports, enhances operational resilience of the central bank.”

The building currently houses some functions of the attorney general department. The central bank said it is working with that entity on a time frame when they can vacate the property for retrofitting work to be done to make it ready for central banking operations.

“My understanding is that there is a structure, offices that have been built. They just need to be finished to be able to accommodate their staff, and that I expect is going to occur in the early part of next year,” Roper replied when asked when the attorney general might be given notice to vacate the property.

“We are not going to put them on the streets, if you are worried about that, and in any event…there is development work that has to be done and it would take time to develop those plans and then to actually get it implemented.”