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<\/a><\/p>\nIn the fiscal year ended September 2017, 138 Student Living (138SL) attained revenues of $601 million and profits of $70 million both of which reflect a more than 100% growth over the previous year. With earnings per share of $0.17 and book value of $6.69, 138SL is currently trading at a rich Price-to-Earnings ratio (PE) of 35 times earnings with a price-to-book value ratio of approximately 0.90 times. Debt to equity ratio stood at a pricey 1.90, denoting a very high exposure.<\/span><\/p>\n The concession agreement between The University of the West Indies (The UWI) and 138SL is similar to a Public Private Partnership (PPP) that a government would enter into with a Private Company. However, the agreement is a unique one since the Government of Jamaica (GOJ) is not directly involved. PPPs reflect a new trend in government policy to encourage more private participation in public projects and to diversify government role in public expenditures. In the case of 138SL the concession agreement is so called because the central government has zero involvement. According to the agreement, The UWI is guaranteeing an occupancy rate of 90% to 138SL. 138SL is then committed to pay UWI $100 million on a prorated factor based on several rules as land lease. <\/span><\/p>\n According to the company, the remaining 10% of occupancy determines whether the company records a profit or not. The agreement is adjusted for inflation so the lease paid to The UWI will be variable up to a maximum of $130 million. In January of each calendar year, The UWI is obligated to provide a list of new students to 138SL that will be enrolled in the University for the upcoming academic year. 138SL then markets its products in a bid to acquire tenants who would be coming to the institution in the following August for the new academic year. This agreement expires within 25 years which see The UWI receiving the buildings built.\u00a0 <\/span><\/p>\n At the annual general meeting 138SL lured to possible expansion. A memorandum of understanding (MOU) has been signed between 138SL and the University of the Technology, but discussions are still on going. There are also discussions happening between 138SL and Northern Caribbean University located in Manchester. One may foresee that capital investment may be a big stumbling block for these schools, however, SAGICOR has reiterated its commitment to the partnership established with the company. <\/span><\/p>\nSpecial Agreement between 138SL and The UWI<\/h2>\n
138SL Eying Local and Regional Expansion<\/h2>\n