West Indian Co., GERS strike Havensight management deal
Published: March 3, 2014
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ST. THOMAS - After five years of negotiations, the Government Employees Retirement System and the West Indian Co. have reached an agreement for WICO to continue to manage the Havensight Mall property.
WICO owned Havensight Mall until 1993, when it was sold to GERS. WICO has managed the property ever since.
Typically, the management contract is renewed every five years without much fanfare, but in December 2009, GERS placed a legal advertisement requesting proposals for the mall's management.
The GERS board chairman sent a letter to then-WICO President Edward Thomas indicating that GERS planned to seek competitive bids, and Thomas responded by saying WICO was no longer interested in the management contract. Thomas also indicated he would close off the access gates between the WICO cruise ship dock and the mall.
In September 2010, the GERS board rejected a bid from commercial property developer Paul Sabers to manage the mall, voting instead to negotiate with WICO.
Since then, no long-term deal has been reached, and WICO has continued to manage the property on a month-to-month contract.
In executive session last week, the GERS board decided on the terms of a new management contract with WICO.
The contract will give WICO a 6 percent management fee for a term of five years. That means WICO will keep 6 percent of the mall's gross profits from rental income, an increase from 4 percent under the old contract.
"I'm pleased that we finally can focus more now on making the necessary improvements to the mall," WICO President and Chief Executive Officer Joseph Boschulte said.
He said for the last four years, WICO has resisted putting any real investment into the property. Now that the parties have reached an agreement, he will be submitting a capital improvement plan to the GERS board, Boschulte said.
Boschulte said when he came on board in April 2012, he wanted to keep the management contract.
I've been working on it since I've been on, and I've been on it almost a year"
"The agreement makes the most sense for WICO and the Havensight Mall to be operating as one," he said. "This is the quintessential case of the parts together add up to more than each one of our parts separate."
- Contact reporter Aldeth Lewin at 714-9111 or email email@example.com.