The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The sales process for New Providence’s South Ocean resort is expected to conclude next month, with the Government said to be pressurising its Canadian pension fund owner to accept a New York developer’s “incredibly good offer”.

Jeremy Seabridge, an executive with Southern Cross Developments, the company hired to masterplan the still-closed 373-acre property, told Tribune Business that “multiple groups” were assessing its prospects.

“Things have progressed very well,” Mr Seabridge said. “We’re nearly through the process, and hopefully it’s looking like we’ll have it concluded by the end of next month.”

Mr Seabridge said this would involve identifying a “suitable prospect” to acquire the southwestern New Providence property, and added: “The end of January is when we’re projecting to have the bids and the process concluded.

“We have multiple groups looking at it right now; we have the bids coming in, and are identifying suitable parties.”

Finding a buyer for, and re-opening, South Ocean has been a priority for the Christie administration since taking office in May 2012. The resort, along with its surrounding real estate options and golf course, were closed by its Canadian Commercial Workers Industry Pension Plan (CCWIPP) owner.

Sources close to the process, though, have told Tribune Business that the Government is pressuring the pension fund to move more swiftly on its South Ocean exit, believing it has retained the asset for too long and is dragging its feet.

This newspaper understands that the Government is particularly taken by an offer on South Ocean from a New York-based developer that is a key player in the group which acquired West Bay Street’s Nassau Palm Resort.

While the Christie administration is pushing for CCWIPP to accept this deal, Tribune Business was told that the Miami-based real estate broker, CBRE, which is handling the sales process for South Ocean, wants to keep it open for longer to see if higher bids emerge.

“Argent Ventures made an incredibly great offer for South Ocean,” one source told Tribune Business. “The Government is aware of it, and the broker in Miami that was employed by the Canadians to sell South Ocean say they want to explore the market more to get higher offers.”

Mr Seabridge said he was unable to comment on this when the matter was raised by Tribune Business, suggesting it contact CCWIPP directly.

However, the Government does have several tools at its disposal which it can use as leverage over CCWIPP. Tribune Business revealed last year that the third New Providence casino licence is no longer ‘locked into’ South Ocean, the Christie administration having effectively opened the field to all-comers who can prove they have the means/expertise to construct and operate a casino.

It could also play ‘hardball’ over allowing CCWIPP, or the new buyer, to close the road that runs through South Ocean, as well as take a hard line over the various investment incentives (tax breaks) it can offer.

“The Government is saying that if you don’t take this [Argent] offer now, we will not be very receptive to anything you do,” the source added. “We will not close the road, there will be no concessions.

“We want that property developed now, and are not going to wait any longer. That is the message the Government is giving the Canadians: You are not going to get a better offer.”

Tribune Business understands that a casino may not be integral to Argent’s South Ocean plans. It is eyeing a more real estate-focused development, which would free up the casino licence for other developers such as Tennyson Wells.

Prime Minister Perry Christie earlier this year confirmed the Government was aware of a “reasonable’ offer for South Ocean, but declined to name the price offered or the buyer.

“There is an application to buy it for a sum that is very reasonable, and we have every reason to be confident that these invitations will translate and manifest itself into jobs,” said Mr Christie.

Tribune Business understands that CCWIPP had been asking $90 million for the 373-acre property, which has been closed for about a decade, with this newspaper’s sources suggesting it was worth anywhere from $30 million to $60 million.

However, Mr Seabridge said no specific asking price had been set for South Ocean, with buyers asked to put their own valuation on it.

“We’re asking for firms and prospects to submit bids,” he added.

Argent Ventures is a New York-based private real estate developer that owns the land under the city’s Grand Central Terminal.

The company also owns the Capitol Records Tower in Hollywood, California, and Miami’s Omni International Mall.

Tribune Business revealed earlier this year how Argent Ventures was a key player in the Sunset Equities group that acquired the Nassau Palm Resort, and is now investing $8 million to upgrade the property to a Marriott Courtyard brand.

And this newspaper disclosed how Argent’s Bahamian resort desires had also turned their attention to the British Colonial Hilton, another property up for sale.

The Bay Street ‘anchor property’ is jointly owned by CCWIPP and Adurion, the Swiss/UK private equity house, and the company currently in the lead here is the developer of Toronto’s Bayside district, Hines.

Tribune Business was told by sources close to developments that Hines was in the final stages of due diligence on its $61 million Hilton offer just prior to Christmas, at which point it has to decide whether to proceed with the acquisition.

“It’s been going on too long, and the offers that have come in are pretty good,” the source said of the Hilton sales process. “If they [Hines] don’t buy, the Argent Group will come through with an even higher offer. They’re as good as you get.”

Hines is a privately owned, international real estate firm with $24.3 billion in assets under management.

The company bills itself as having a presence in more than 100 cities and offices in 18 countries, with regional US offices in Atlanta, Chicago, Houston, London (European headquarters), New York and San Francisco.

Hines’ portfolio includes 1,273 properties, including skyscrapers, corporate headquarters, mixed-use centres, industrial parks, medical facilities, and master-planned resort and residential communities.