Sumner on Grand Lucayan: Better to sell now than incur huge costs later
Former Bahamas Chamber of Commerce and Employers’ Confederation (BCCEC) Chief Executive Officer Edison Sumner lauded the government’s move to offload the Grand Lucayan resort complex for $65 million, even if it could not get the best possible deal. Meantime, former President of the Grand Bahama Chamber of Commerce Kevin Seymour is asking what the “devil in the details” of the deal are.
Sumner, who spoke to the press following a press conference on Friday, said it is probably better that the government sell the Grand Lucayan property now, rather than incur huge costs holding on to it for much longer.
“Even a nominal loss may be acceptable rather than having to suffer a significant loss by holding on to the property for a very long time,” Sumner said.
“Now that they have found hopefully a willing buyer – because this is just an LOI (letter of intent), this is not yet a contract for purchase as I understand it, and hopefully this is going to lead to a contract for purchase once it’s all settled – we will see some significant approvals to the product in Grand Bahama, tourism arrivals coming into Grand Bahama, and greater opportunities for more entrepreneurship, for more business development and for expanded employment opportunities.”
The government purchased the Grand Lucayan property from Hong Kong-based conglomerate Hutchison Whampoa because it thought the revival of the hotel would be the best thing to revive the island’s economy.
Seymour said in a press release he issued yesterday that the government needs to provide more details before he and others can fully get behind the proposed purchase of the Grand Lucayan and the redevelopment of Freeport Harbour by Royal Caribbean International and ITM Group.
“The government claims that under the terms of the deal, it will be able to recoup its $65 million purchase price for the Grand Lucayan,” he said.
“I submit however, that before this determination can be made with any degree of certainty, one needs to fully understand how the operating expenses incurred by the government since it acquired the Grand Lucayan will ultimately be absorbed, and the amount of concessions (i.e. stamp duty and other concessions etc.), if any, the government is prepared to provide to the joint venture (Royal Caribbean and ITM).”
Seymour also asked why Hutchison has not been mentioned by the government given that it owns Freeport Harbour.
“Will Hutchison again be waiving its ‘exclusive right’ to own ports on Grand Bahama Island to the joint venture?”
He continued, “How will this deal affect other businesses tied to Freeport Harbour, such as the Freeport Container Port, Grand Bahama Shipyard, Bradford Marine, Bahama Rock, FOCOL and others?”
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