Ex-chief negotiator for Grand Lucayan resort says airport explains delay in sale – Eye Witness News
NASSAU, BAHAMAS – The former chief negotiator for the committee responsible for selling the Grand Lucayan Hotel hinted yesterday that negotiations to finalize the sale of the resort have been dragging on because the buyer is demanding substantial commitments from the government for the development and reconstruction of the Grand Bahama International Airport.
Michael Scott said: “What is key to finalizing any deal are government guarantees on the construction and refurbishment of Freeport Airport.
“Any investor with any degree of skill or ability will not invest mega millions in a project and there is no modern, properly staffed airport facility that will allow pre-clearance and enable the normal traffic that happens with visitors coming in and out without having to go through Nassau and being, if my information is correct, limited to possibly one flight a day or only several a week.This is not the way to feed a hotel. “
Scott’s comment to Eyewitness News comes after his successor Julian Russell, the current chairman of Lucayan Renewal Holdings Limited, said in a statement yesterday that the sale of the complex was progressing steadily towards completion, but the parties had agreed to a 45-day extension to complete the necessary legal documentation. .
Russell said renovations are expected to begin in January 2023.
The government announced in May that Lucayan Renewal Holdings LTD had reached an agreement with Electra American Hospitality Group to buy the Grand Lucayan Hotel for $100 million.
Tourism, Aviation and Investments Minister Chester Cooper said the deal was subject to a 60-day due diligence period, with closing no later than 120 days.
Cooper also said in June that three credible investors had expressed interest in the Grand Bahama airport redevelopment. He said a world-class facility, when completed, will increase air travel to the island.
Still, Scott believes that without airport guarantees, the initial announcement of the Electra deal might have been premature.
“I think the government, in their concern to deliver good news, may have been a bit premature, that’s my hunch,” he said.
“It all hinges on a specific commitment to rebuild the airport and modernize this facility within the next two years. Unless these negotiations could very well stumble and fail as happened to my committee when we were negotiating the sale of the hotel to the RCl/ITM union I see no other rational reason for the delays.
Scott continued: “It must be assumed that whatever policy is involved, governments act rationally and they must know If you don’t make ironclad commitments or make the effort or do as the government did with the Vancouver company to create the current ATIPP model and structure, they would be at the end of their five-year term in no way better off than we were in terms of the economic and financial revival of Grand Bahama.
“My perspective is highly anticipated and I think the media and relevant stakeholders, people in the resort and tourism sphere of Grand Bahama’s economy should just give the government a little more time.”
“My sources tell me that to do the kind of work that would turn the airport into a state-of-the-art airport, taking into account that some of the buildings may have to be removed because they are too low, I think in terms of the budget for a real redeveloped airport facility, you’re looking at around $80 million.
Scott said: “Given what is happening in the markets and in the global economy and the prospect that the North American world in particular is on the cusp of a recession, the only way in my view , to progress logically is to do it as a joint venture or get international funding from the IDB or the World Bank or something like that.
“I suspect that the investor is not getting the kind of guarantees that they need and need to put their own financing in place and proceed with the project. Those guarantees would have to come from the government and the logical path that would be taken would be through a memorandum of understanding.