Surprising interest in the Grand Bahama hotel
There was controversy last year when the government decided to buy the Grand Lucayan. It is made up of three hotels – Breaker’s Cay, Memories and Lighthouse Pointe.
The resort closed in 2016 after it was damaged by Hurricane Matthew. Only Lighthouse Pointe reopened.
The government bought it from Hutchison Whampoa. It did not think Hutchison was sufficiently motivated to sell. The resort needs a new owner who has money and the vision to make the property attractive.
Michael Scott is chairman of Lucayan Renewal Holdings – the special purpose vehicle the government created to make the purchase. He told this newspaper yesterday there were “in excess of 60 bids” for the property when the submission period ended Thursday.
“This is the beginning. Some of the proposals aren’t real, but the process is transparent, it’s organized. It’s efficient and we will get there. Anyone can make an offer, it doesn’t mean they have the money or cash or the vision that’s right for Grand Bahama,” said Scott.
He likened the process of whittling down the proposals to the top three to that of a beauty pageant, and said it should be complete within the next few weeks.
“Our marketing team is drilling down on them and they will be discussing and making recommendations to us and in a few weeks, we’ll have a determination and make a detailed recommendation to Cabinet, then evaluate the pros and cons and have the absolute final list from which the government can make a determination,” said Scott.
The government purchased the resort for $65 million. It hopes to sell the property by the second quarter of 2019.
The large number of potential buyers is a good sign. No one thinks the government should own this hotel long term. Its intervention was an emergency step, considering the former owner appeared willing to shut the property and move on.
It is essential that the government picks an owner with the right vision to create an attractive property. The owner should also have a track record in the industry, a credible background and the capital to build out the vision.
The sale of this property would be good news for Grand Bahama, as was the announcement earlier this month of the island’s new cruise port.
The Carnival Cruise Line port is expected to provide more than 1,000 direct and indirect permanent jobs. The port will be developed at Sharp Rock, four miles east of Lucaya in Freeport.
There is also a multi-billion dollar proposed mixed-residential project at West End. The development does not yet seem shovel-ready, but its commencement, too, would bolster Grand Bahama’s fortunes.
The unemployment rate on the island was 11.9 percent in the most recent labor force survey, which was conducted in November. That figure, though, masks the true story of the situation. A sharp decline in economic activity over the past 15 years has led to population flight from the once prosperous island.
The Free National Movement (FNM) won all the Grand Bahama seats in the last general election. Residents expect policy decisions to help bring life back to its economy.
If the West End project, Carnival and a revived Grand Lucayan all happen simultaneously, the FNM would have delivered much to the people who voted in the party to represent their interests.