The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Bonefish conservationists last night voiced concerns about potential negative impacts for a key fisheries spawning ground if Royal Caribbean's proposed Xanadu Beach Hotel acquisition proceeds.

The Bonefish & Tarpon Trust (BTT), in a statement, said it is "closely monitoring potential cruise port development plans near Xanadu Beach" given that a bonefish pre-spawning aggregation (PSA) site is located nearby.

It added: "BTT recognises the importance of balancing economic development and environmental conservation, and expresses its willingness to work closely with the developer to explore solutions that minimise negative impacts on the PSA site at Xanadu Beach."

Tribune Business revealed in December 2023 that the cruise giant was eyeing the potential acquisition of Freeport's long-closed Xanadu Beach Hotel as part of plans to develop a resort and water park destination, along with the purchase of "all the tracts of land down to Princess Isle" that are presently controlled by Irish-headquartered Harcourt Developments, the Royal Oasis owner.

This newspaper understands that negotiations between Royal Caribbean and representatives for the Xanadu's owner, Mario Donato, are ongoing. Part of the cruise line's plans are thought to involve mooring at least one of its vessels off Xanadu Beach close to the site identified by the BTT.

“PSA sites are vital for the survival of these species, and any disturbance or alteration to these areas could have irreversible consequences,” said BTT Bahamas initiative manager, Justin Lewis. “A PSA site is a crucial location in the life cycle of bonefish and other species. It is a gathering point for bonefish that travel from flats 10 to even 100 miles away.

"They gather at these sites before moving offshore to spawn. These sites play a pivotal role in the bonefish reproductive process, and any disturbances or alterations to these PSA sites can disrupt the natural reproductive cycle, impacting the local and regional bonefish populations.”

The BTT said recent research documented Xanadu Beach as a bonefish PSA site and tracked bonefish moving offshore to spawn. This, it added, confirms that this location is essential for sustaining the bonefish population and supporting the economically and culturally important fishery.

"BTT acknowledges the importance of responsible tourism and recognises the economic benefits of the cruise industry. Nevertheless, the burgeoning cruise industry has raised concerns due to its potential impact on PSA sites, notably Xanadu Beach," the BTT added.

“Bonefish & Tarpon Trust calls for transparent and science-based decision-making processes that consider the ecological significance of Xanadu Beach and the potential consequences of the proposed development,” said BTT president and chief executive, Jim McDuffie.

“The vitality of flats fishery is also intricately connected to our valued partners in the bonefish guide and lodge communities, given that flats fishing serves as a substantial economic catalyst in its own right and is culturally important. BTT is committed to working with all parties to find solutions that balance economic interests and preserve critical marine habitats, with an eye toward long-term fishery, cultural and economic health.”

The BTT concluded: "It is essential to prioritise the conservation of these PSA sites to ensure the long-term sustainability of bonefish populations and the marine environment's overall health, as well as the Bahamians who depend on healthy fisheries and marine habitats."

This newspaper reported that Royal Caribbean's interest in what one estimated is a 40-50 acre site, should it acquire all the targeted land parcels, is a signal that it must have reached - or be close to sealing - a deal for Freeport Harbour's transformation. It has been locked in negotiations with Freeport Harbour Company, which is 50/50 owned by Hutchison Whampoa and the GBPA’s Port Group Ltd affiliate, for several years.

"They want all the tracts down to Princess Isle," one source said of Royal Caribbean. "It's probably 40-50 acres. If you look at the map you will see Xanadu at one end and four more ten-acre pieces going down to the west to Princess Isle. Harcourt Developments owns the next two."

One source, though, said Royal Caribbean's Xanadu interest also involved its high-end affiliate, Celebrity Cruises. "Celebrity is Royal Caribbean's premier cruise line, the best of the best, which is very good news for Freeport, because we usually get the worst of the worst," they added. "They'll [the two cruise lines] probably use it together and share it.

"It's a wonderful plan. It looks too big to me to just be a water-based adventure or theme park. That would be a major first step for Freeport. We'd have the Shipyard investment, the new harbour docks for the mega cruise ships, be it Royal Caribbean, Mediterranean Shipping Company (MSC) or whoever else, and then the 50 acres on the beach. This could also be the impetus for the airport to get done."

Tribune Business had previously been told that Royal Caribbean was seeking a more tourist-friendly location for the water park it had initially planned to locate at Freeport Harbour, which has a more industrial feel, hence its interest in the Xanadu.

Should the cruise line's plans come to fruition, this newspaper was told that ITM Group, its Mexican partner on the aborted Grand Lucayan venture, and their Holistica joint venture will ultimately operate the proposed amenities and attractions.

Built in 1968 by US shipping tycoon, D. K. Ludwig, the Xanadu established itself as a venue for the so-called "Rat Pack" - the likes of Frank Sinatra, Sammy Davis Jnr, Cary Grant and Dean Martin - as well as accommodating reclusive billionaire Howard Hughes, who once lived in its 13th storey penthouse.

The 184-room property was acquired by Mr Donato in 1987, but it ultimately closed in 2011. The Xanadu is listed for a $25m asking price on Bahama Islands Properties' website, which says: "The 184 rooms has it all.

"Set on a world class beach, it also boasts a 75-slip marina with incredible potential, and in addition more than 20-plus acres strategically located near downtown and the airport. It is perfect for aggressive rooms and amenities expansion or adding condominiums." Another realtor, James Sarles Realty, has the resort listed for $35m.

Ian Rolle, the Grand Bahama Port Authority’s (GBPA) president, told a Bahamas Hotel and Tourism Association (BHTA) meeting in late April that October 2023 was being targeted for completion of the $70m Freeport Harbour deal in which Mediterranean Shipping Company (MSC) had teamed with Royal Caribbean and ITM Group.

“They are looking to redevelop the existing harbour,” he confirmed. “At first, ITM and Royal Caribbean were the only ones involved in this process. MSC has now come along and joined them in this partnership and we intend for this deal to be closed by October this year.”

Michael Bayley, Royal Caribbean’s president and chief executive, previously told this newspaper that Royal Caribbean was “increasingly optimistic” that its joint venture with ITM Group will finally come to fruition as negotiations - which have already taken several years - continue with Freeport Harbour Company.

The cruise chief said that investment would involve other parties, especially fellow lines that will use Freeport Harbour’s revived cruise port. Mr Bayley also confirmed that Royal Caribbean/ITM’s plans still call for an expansion in the number of cruise ship berths, and development of a water-based adventure theme park for passengers in close proximity to the harbour.