Over many years, even before the ferocious Hurricane Dorian tore a destructive path across Grand Bahama in 2019, many Grand Bahamians have been feeling that their island cannot catch a break.
With diminished opportunities for advancement in an economy that has long been on its knees, many residents relocated and others continue the struggle to get by.
The symbol of the island’s weakened state has long been the Grand Lucayan resort, which was shuttered after Hurricane Matthew in 2016.
The property became very much a political football when, in 2018, the Minnis administration purchased it from Hong Kong conglomerate Hutchison Whampoa for $65 million.
Since then, untold millions of tax dollars have been pumped into the resort’s black hole with seemingly no end in sight to this unfavorable position.
Months after coming to office last September, the Davis administration in December canceled the sale deal the former government entered into with Royal Caribbean Cruise Lines (RCL) and the ITM Group in 2020 for $50 million, saying it was not in the best interest of Bahamians.
Up to that point, Minister of Tourism, Investments and Aviation Chester Cooper reported that the resort had already cost taxpayers in excess of $150 million.
The canceled deal left Grand Lucayan in a state of protracted limbo.
Yesterday, the government announced that it has entered into an agreement with real estate investment firm Electra America Hospitality Group (EAHG) for the resort’s purchase at a cost of $100 million.
“Today is the beginning of the renaissance and rebirth of Grand Bahama Island,” Cooper declared.
The agreement is subject to a 60-day due diligence period with closing no later than 120 days.
According to its website, Electra America Hospitality Group “is a unique joint venture between Electra America, a leading real estate operator and capital provider, and AKA, the global leader in luxury hotel residences. The partnership is designed to capitalize on dislocation in the hotel industry.”
According to Cooper, the group’s principals boast over 150 years of collective experience in the hospitality business, and the conglomerate has worldwide assets worth $7 billion in significant holdings.
Cooper reported that Electra has committed to an estimated $300 million in construction and renovation to rebuild the resort into an environmentally sustainable luxury property.
He said the property will be redesigned to include a luxury lifestyle hotel, an upscale convention hotel to cater to groups and the convention market, along with an all-suite family resort.
The refurbishment of the golf course is also planned, in addition to a renovated casino managed by a world-class casino operator.
According to Cooper, there will be 2,000 construction jobs and 1,000 permanent jobs.
The developers have committed to keeping Lighthouse Point at Grand Lucayan open throughout the property’s redevelopment.
While the devil is most certainly always in the details, the agreement appears to be a significant turning point for Grand Bahama and, from all we can tell, has many Grand Bahamians feeling hopeful.
However, given all that has been promised for the island by past administrations and by investors, we understand why some Grand Bahamians would take a wait-and-see attitude toward this latest deal. Like them, we hope it is not a deal too good to be true.
If all goes to plan, and the sale closes, taxpayers would be able to breathe a collective sigh of relief to have this albatross removed from their necks.
If Electra delivers on all that has been announced, this would be a catalyst for the long-delayed and long-sought after recovery for Grand Bahama Island.
The spinoff benefits would for sure be tremendous. It would be an important investment not just for Grand Bahama, but for The Bahamas.
Critical to the success of Grand Bahama’s revitalization is a new, modern airport and robust airlift coming into the island.
Cooper announced yesterday that the completion of a new Grand Bahama International Airport is set for 2025, the same year the redeveloped resort is scheduled to be completed.
This, too, would be an important development for the economically starved island.
We look forward to seeing the full terms of the agreement with Electra, and we expect that the government will hold the investor to its commitments.
Grand Bahama deserves no less.