Reaffirming Prime Minister Dr. Hubert Minnis’ commitment to fully disclose the details surrounding the government’s purchase of the Grand Lucayan resort when he makes his communication in Parliament today, Press Secretary Anthony Newbold indicated yesterday that he has seen the details relating to the purchase of the hotel in Freeport and the prime minister “is going to tell you all”.
Fielding questions from The Nassau Guardian on the purchase, inclusive of the projected operational losses to be absorbed under government ownership, Newbold said, “All of those details will be laid out, I can assure you.
“All of those details; whatever details are concerning the purchase of that hotel, the prime minister has it.
“I know he has it because I have seen it.
“He is going to tell you all. He is going to answer all the questions you have tomorrow about the Grand Lucayan sale.”
The government is purchasing the resort for $65 million, with $30 million paid up front.
The government is expected to table a resolution to borrow $35 million from Hutchison Lucaya Limited (HLL), which will be a government guaranteed mortgage to be paid over three-and-a-half years.
The loan would be repaid in seven tranches of $5 million every six months, with an interest rate of four percent per year paid quarterly: $4.9 million to be paid in $350,000 installments every three months, according to the resolution.
The government will also pay over $1 million to HLL for operational losses while it kept the hotel open during the execution of the sale.
The first installment has already been paid, according to guarantee documents obtained by The Guardian.
The government will pay another six installments of $142,860 and a final installment of $142,840.
The “subsidy” for the operational losses is to be paid alongside the interest payments and each tranche of the government bonds.
The government decided to “purchase in the public interest”, according to the resolution.
Yesterday, Newbold reiterated that point, insisting the government’s purchase was to avoid disaster, but it did so with the full intention of selling the resort.
“What was happening in Grand Bahama is a disaster; still is a disaster until the government concludes this and gets this going the way it ought to go,” he said.
“The government is not out there buying this hotel saying ‘you know, five years from now we are going to be making a profit’.
“The government does not intend to be involved with this hotel five years from now.”
The government hopes to find a buyer within three to six months, according to officials.