Phases one and two of the redevelopment of Nassau’s cruise port will be able to begin in earnest, after Nassau Cruise Port Limited announced that it successfully raised more than $130 million over two weeks in a private bond offering through Colina Financial Advisors Ltd. (CFAL).
Nassau Cruise Port revealed in a press statement that CFAL confirmed that the bond offering, which sought to raise $80 million in the local market and $50 million in U.S. currency, was oversubscribed when it closed on Friday.
The redeveloped cruise port is expected to provide much-needed jobs and is projected to have a $300 million impact on the Bahamian economy through the development phase; and a $15.7 billion contribution to the economy over Nassau Cruise Port’s 25-year concession period, the statement noted.
Nassau Cruise Port Chief Executive Officer Mike Maura said in the statement that the start of the project is important for the country given the financial and economic setbacks caused by the novel coronavirus (COVID-19).
“During these unprecedented times, this essential project will put food on the table for many Bahamians who didn’t know how they were going to feed their families in the weeks and months to come,” Maura said.
“Through construction and other requirements, our project will immediately produce much-needed jobs and support the creation of small and medium-sized businesses.
“We wish to thank the many investors who recognize the national importance of this project and have given us their backing.
“We are also very grateful for the assistance of the Central Bank of The Bahamas and the Securities Commission of The Bahamas, whose extensive support helped to make this effort so successful.”
The $130 million will go towards phase one’s buildings and structures demolition, which the statement said is currently underway; and phase two’s expansion of the berthing capacity of the port, as well as upgrades to the existing infrastructure.
Maura said Nassau Cruise Port’s bond success adds confidence to a cruise industry that has been financially impacted to the tune of billions of dollars, via self-imposed and health-industry-imposed no-sail orders.
According to Maura, the start of the redevelopment of the cruise port is also an important strategic win for The Bahamas’ tourism industry.
“From an industry perspective, our project is critically important,” he said.
“Our success is a signal to our tourism partners that the Bahamian tourism industry and specifically Bahamian cruise tourism, will continue to thrive.
“Moving forward on this project puts The Bahamas miles ahead of our competitors, who will be challenged to offer a product to rival our exceptional port and waterfront experience. With the support of our key stakeholders, this project will exponentially improve the circumstances of thousands of Bahamians.”
President of CFAL Anthony Ferguson said there was great interest in the high-yield bond offering, with its eight percent return, even from outside the pool of institutional investors.
He explained that CFAL is working on accommodating individuals and groups who had an interest in the offering, but wanted to buy in below the $50,000 minimum.
“We received a considerable amount of interest from Bahamians who sought to participate in this phase of the fundraising, but wanted to come in at a lower minimum threshold or to invest as a part of a group,” Ferguson said.
“We are considering alternative options that will give those who missed this opportunity a chance to invest with a slightly different framework. We’ll share that information once we have more details.”
Everyday Bahamians will be able to invest in the funding of phase three of the project through an initial public offering (IPO) in the second quarter of 2021.
According to the statement, phase three will include completion of the landside works, including a new arrivals terminal and plaza, a Junkanoo museum, a retail marketplace, an amphitheater and other food and beverage and entertainment spaces.
“We are preparing diligently for the recovery of the tourism industry and the return of millions of cruise passengers,” Maura said.
“We do not know exactly when they will be back, but we are in constant communication with local and international cruise partners to ensure that we stay ahead and are prepared. In addition to moving forward with our construction efforts, our significant priority is to protect our visitors, staff members and community. We’re actively working with our partners to devise comprehensive strategies to make visiting Nassau a safe, pleasant experience for everyone involved.”