The Cayman Islands government could earn millions from the sale of “surplus” properties it owns, but the figure projected by Premier Alden McLaughlin’s government is far less than what private sector consultants estimated.
“The expected value is in the region of $8 million to $10 million total, depending on the updated valuation and prices obtained when sold,” according to a statement provided by Mr. McLaughlin’s office.
According to the Ernst & Young consultants report, which was completed last September, government was advised to seek to sell $65 million worth of “surplus” properties by the end of 2015.
The premier said earlier this week that all lands considered for sale were viewed as “non-strategic” by the government, meaning the Crown had no particular purpose identified for them in either short-term or long-range plans. Properties involved in the sale were located in all districts in the Cayman Islands, and a business case for the sale was being developed, the premier said.
Public tendering would commence for sale of the lands when that process was completed, he added.
The identification of properties to be sold was done following a review by the government Lands and Survey Department.
The EY report also recommended that government seek to enter into purchase and lease-back arrangements with private sector investors to free up capital needed to pursue current infrastructure development projects.
“Government presently holds some 170 operational buildings, the majority of which are described as specialized and of which 16 are described as non-specialized,” the EY report stated. “The ascribed value of these properties is $285 million.”
Mr. McLaughlin said the Progressives-led Cabinet had not accepted EY recommendations to sell or create lease-back arrangements for a number of government assets, including the Water Authority–Cayman, the Government Administration Building and Radio Cayman.
Land and buildings
The EY report looked at the specific properties owned and leased by the government, which included 155 acres of “operational lands” and 5,415 acres of what were determined to be “non-operational” lands. The value of the non-operational lands was estimated at nearly $67 million.
Operational lands include parks and landfill space. The non-operational lands include undeveloped parcels, mangrove and swamp areas, ponds and coastal areas. The report identified 154 operational specialized buildings and another 16 operational non-specialized office buildings. The government did not specify which particular parcels or areas it would put up for sale.
EY reviewers found 20 government-owned buildings that are also considered non-operational, with an estimated value of nearly $3 million. Those include small vacant commercial and residential properties.
The report did not provide an estimated value for 180 acres of “heritage sites” owned by the government. It also does not evaluate infrastructure or highway assets.
The government currently holds leases on 60 building sites at a cost of $5.2 million per year, EY consultants noted.