Local mortgage lender funds St. Croix resort

Real Estate Weekly, Sept 1, 2004

Thanks to a $3.9 million loan from Kennedy Funding, a direct private lender based in Hackensack, N.J., prime beachfront property totaling almost 600 acres on the lush western shore of St. Croix in the Virgin Islands, is headed for luxury resort development. William and Punch Partners, LLP is planning to build "The Mills of St. Croix," a master-planned residential resort community consisting of 125 luxury homes, a 300-room luxury hotel, a 10,000 s/f casino, an inland marina and an 18-hole championship golf course on the site.

The land is rich in local history, in addition to being virtually untouched since its last days as a sugar mill in the 1940s. However, its significance goes back considerably further, to the "Fireburn" of 1878--the labor riot that launched the labor movement in the Virgin Islands by burning the sugar mill on the property to the ground.

Kevin Rames, one of the purchasing partners in William and Punch Partners, LLP of St Croix, is descended from generations of St Croix natives. In a letter to the Governor of the Virgin Islands, he emphasized the importance of this project: "In the distant past, the working people of St Croix, whether slave or indentured, underpaid and undervalued, made this historic property productive. After many decades of laying fallow, [it] will once again be productive."

The original purchase contract for the land was $3.75 million, which preceded a re-zoning that will allow for the planned development. Kennedy Funding arranged a loan of $3.9 million, or more than the purchase price, in appreciation of the increased value of the land. Jeffrey Wolfer, president of Kennedy Funding, remarked that "This isn't the first time we have entered international waters to arrange for financing, and even though St Croix is a U.S. possession, there is a tangle of legal and monetary issues to unravel. Fortunately, this is an area that is increasingly part of our expertise, and we were delighted to bring the deal to fruition."

Kevin Rames expressed thanks to Kennedy Funding "for believing in us. They worked assiduously to bring this transaction to a close and the people of St. Croix will be better for it."

The property is largely covered with natural vegetation, with many knolls, vales and slopes that afford stunning vistas of the Caribbean Sea.

The developers plan to build 125 luxury homes on these ridgetops to take advantage of the tropical scenery.

The senate president of the U.S. Virgin Islands, David S. Jones, has been a supporter of the project and helped shepherd the re-zoning through the local legislature.

"It is one of the best properties on the island, #1 for development," he said.

"It will have a significant, positive impact on the Virgin Islands, especially St Croix, and make us competitive in the global tourism industry."