The Tribune

By NEIL HARTNELL

Tribune Business Editor

CLICO (Bahamas) liquidation team is hoping to recover "considerably more" than $40 million from the liquidation of the Florida-based real estate project that accounts for 63 per cent of its assets, Tribune Business was told yesterday, with "huge interest" having been expressed in its remaining 283 acres.

Ronald Neiwirth, the US-based attorney acting for the insolvent insurer's liquidator, Baker Tilly Gomez accountant and partner, Craig A. 'Tony' Gomez, said that with Florida real estate prices rising and smaller parcel sizes increasing the per acre yield, the Wellington Preserve recovery prospects for Bahamas creditors looked "far better now than they did six months ago".

Explaining that the CLICO (Bahamas) liquidation team had initially targeted $40 million as the "break point" in terms of what was recovered for the insurer's Bahamian creditors, Mr Neiwirth said more from the initial $13.384 million sale would be returned to this nation.

Mr Gomez and Mr Neiwirth have just sold a 138.3-acre tract at Wellington Preserve for that price, but only $10 million of that sum has been initially returned to the insolvent insurer's Bahamian subsidiary, CLICO Enterprises, with the remainder "held back in reserve" for the moment.

Tribune Business yesterday estimated that CLICO (Bahamas) policyholders and creditors were likely to recover a total $30-$40 million from Wellington Preserve once its remaining 283 acres were sold, but Mr Neiwirth said the final figure was likely to come in at the top of that range.

"I would say the higher end estimate is considerably more accurate, and depending on how much the price increases, it could be considerably more than that," Mr Neiwirth told Tribune Business.

"The bottom line is that if we sold 138.3 acres for $13.384 million, we have 283 acres left to sell, which is about twice as much. That first $10 million is also not all they [CLICO Enterprises] will get, as some has been held back in reserve.

"Therefore, the bottom line is that recovery could exceed $40 million. If it's broken into smaller pieces, it could be done. It could be done because we'll make the buyers pay a higher per unit price for the smaller parcels."

CLICO Enterprises, the vehicle through which CLICO (Bahamas) invested funds into Wellington Preserve, is owed some $73 million by the Florida-based real estate project. A $40 million recovery would mean about 55 per cent of the total sum owed returns to the Bahamas.

"That was our intention in the beginning to hit that break point. Our intention was always to get up that far," Mr Neiwirth told Tribune Business of the $40 million goal.

"Things are working out very nicely. The liquidator's decision to break up Wellington Preserve into small pieces to get higher prices, rather than sell it wholesale in big chunks, was a great business decision, and I felt it was a well-founded one."

Mr Neiwirth added that there was "considerable interest" from buyers in Wellington Preserve's remaining real estate, with the liquidation team's broker going "full speed" to wrap up the sale of the remaining 283 acres.

"She's talking to people about everything bar five acres in the corner," he said. "It seems to be going well. I spoke to Mr Gomez yesterday, and he's pleased there are returns now being provided to the Bahamas.":

Asked about how favourable the Florida real estate market, and its prices, were to maximising recovery for Bahamian creditors, Mr Neiwirth added: "I like it far better now than I did six months ago.

"It is considerably improved. We hit the bottom of the market, and it's now coming back nicely."

The US attorney added that one sales contract currently under negotiation had a "price per acre considerably in excess" of the one achieved in the $13.384 million transaction just closed. He described this as a function of an improved market and smaller real estate parcels, which enabled Mr Gomez to charge the higher per acre price.

Mr Neiwirth said he and Mr Gomez were constantly seeking to minimise costs associated with Wellington Preserve's liquidation, in order to maximise the recovery for CLICO (Bahamas) Bahamian creditors.

Tribune Business reported on Monday how Mr Gomez and his team had returned $10 million to the Bahamas after selling 138.3 acres, almost one-third of the remaining real estate, at Wellington Preserve, which is located in West Palm Beach, Florida.

The transaction raised a gross $13.384 million, but CLICO Enterprises, the wholly-owned, Bahamian-domiciled CLICO (Bahamas) subsidiary that held the insolvent insurer's Wellington Preserve interests, only received $10 million due to Mr Gomez's need to cover expenses related to the property's administration and Homeowners Association.

Still, the $10 million recovered is the first tangible sign of progress in the recovery effort for Bahamian creditors since CLICO (Bahamas) was placed into liquidation in February 2009.