Getting there in Grand Bahama
The process to sell the Grand Lucayan in Grand Bahama seems to be slowly nearing its end stage.
Tourism Minister Dionisio D’Aguilar said yesterday the government has narrowed its list of potential buyers down to about “three or four”.
Last month, attorney Michael Scott, chairman of Lucayan Renewal Holdings, a special purpose vehicle established by the government with responsibility for finding a buyer, said there were “in excess of 60 bids” for the resort.
“We’re in the negotiation phase, so we’re hedging on what we can disclose and not disclose, but it’s for a reason,” D’Aguilar said.
“We’re negotiating. We don’t want to show our entire hand within the press, so I know you’re anxious for information, but you know we’re doing the best that we can to negotiate and to keep you as informed as we can. But when it’s done we’ll let you know.”
There was controversy last year when the government decided to buy 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 for $65 million from Hutchison Whampoa. It did not think Hutchison was sufficiently motivated to sell.
The sale of the property would be good news for Grand Bahama. 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 situation. A sharp decline in economic activity over the past 15 years has led to population flight from the once prosperous island.
Big players are interested in purchasing the Grand Bahama hotel. Earlier this month, Royal Caribbean CEO Michael Bayley said the company had entered a 90-day discussion period with the government, during which time it would present its final proposal for redevelopment of the resort complex.
“The Grand Lucayan property needs investment in terms of refurbishment; more importantly there needs to be more experiential elements added to the destination itself,” he said.
“That’s what we’re working on, adding experiences so people can have more fun and more interaction with their vacation… So, that will come forward in our proposal.”
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.
There is consensus that the government should not be in the hotel business. This administration said it intervened in an emergency situation, and it intends to get the resort back into proper private sector hands in the shortest possible time.
The test of this intervention will be just that. If the resort is sold and hundreds of Bahamians find work in the refurbishment, and hundreds more at its opening, the government would have succeeded. But if it is left holding the asset years from now, still desperately searching for a buyer, the critics’ assessment that it should not have made the purchase would be proven correct.