With a large Hong Kong-based conglomerate lined up to buy the stalled mega-resort Baha Mar, the Prime Minister of the Bahamas has proclaimed that the Caribbean’s biggest leisure development will finally start opening in April 2017 – a month before he faces a general election.
Perry Christie said at a tourism business lunch in Nassau on 2 December that work on the nearly-complete $3.5bn resort and casino (pictured), abandoned amidst acrimonious legal battles in June last year, was underway again by the Chinese contractor, and that hundreds of rooms would be open in the second quarter of next year.
Resort staff numbering 1,500 would be hired "early in the New Year", Prime Minister Christie said, with total headcount expanding to 4,300 by December 2017 – important news for the tiny island nation plagued by economic stagnation and high unemployment.
The general contractor currently has over 500 workers on site with oversight of standards and the construction timetable for completion. This will ensure on-time completion of those properties that are slated to open in April 2017 and by December 2017– Perry Christie, Prime Minister of the Bahamas
A breakthrough in the Baha Mar stalemate, which has been a festering political problem for Christie, came in October when Hong Kong conglomerate Chow Tai Fook Enterprises (CTFE) revealed that it was the rumoured entity negotiating to buy the resort from its main financier, the Export-Import Bank of China (Exim Bank).
As part of the government’s due diligence process a senior delegation flew to Hong Kong on 5 December to meet CTFE and tour its casino operations.
On board the plane were Bahamian Attorney General Allyson Maynard-Gibson, tourism minister Obie Wilchcombe, Sir Baltron Bethel, senior advisor to the prime minister, and four officials from the country’s Gaming Board, which must approve the sale, reports local newspaper, The Tribune.
The momentum gathering behind the sale of Baha Mar to CTFE will be unwelcome to the ambitious scheme’s original developer, Sarkis Izmirlian, who has made repeated public offers to buy the resort back from the Exim Bank to get it open.
Izmirlian’s companies filed for bankruptcy protection in June 2015 after successive delays in opening the resort, for which Izmirlian blamed the contractor on the scheme, China Construction America, which has now resumed work on the complex.
Prime Minister Christie, however, is banking on CTFE acquiring the resort and opening it for business before the Bahamas general election, scheduled for May 2017.
"You may have heard by now the announcement regarding the acquisition of the Baha Mar properties by a Hong Kong-based company – a world-class hotel, real-estate developer and business conglomerate," Christie said on 2 December. "They are arranging for operation by the Grand Hyatt of the Casino and Convention hotels and of the other properties by SLS and Rosewood, all internationally renowned brands, beginning with a phased opening in the second quarter of 2017."
"The general contractor currently has over 500 workers on site with oversight of standards and the construction timetable for completion," he added. "This will ensure on-time completion of those properties that are slated to open in April 2017 and by December 2017."
According to newspaper The Tribune, a "major meeting" on Baha Mar was held at the Prime Minister’s office on 5 December, before the government delegation flew to Hong Kong.
Representatives of CTFE, the China Exim Bank, and China Construction America all promised Christie that they would make 700 rooms available in March 2017, in time for the 2016-2017 winter tourism season, the newspaper reported, citing sources.
The Exim Bank, meanwhile, will be hoping it can finally offload the troubled scheme.
After investing $2.5bn in Izmirlian’s resort in 2010, the Exim Bank acquired control of it in October 2015 when the Bahamas Supreme Court placed the resort in receivership. Since then the Exim Bank has been trying to sell it, ignoring Izmirlian’s offers.
Announcing its interest in October this year, CTFE presented itself as a natural choice as Baha Mar buyer. One of CTFE’s subsidiaries is the Rosewood Hotel Group, which had been one of the four operators originally signed up by Sarkis Izmirlian.
"CTFE is looking forward to having Baha Mar join its portfolio of world-class integrated resort development projects," said Dr. Henry Cheng, chairman of the family owned group. "We are fully committed to this project and plan to hire as many Bahamians as possible to work at the property."
As the election looms, however, Prime Minister Christie’s political opponents have warned him not to rush into approving CTFE’s purchase, citing concerns over allegations of the Cheng family’s "deep rooted relationships to elements of organized crime".
CTFE has dismissed these concerns.
Image: Aerial view of the Baha Mar resort under construction