The Tribune

By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

PRIME Minister Perry Christie said yesterday he was “encouraged” by ongoing negotiations to sell both the British Colonial Hilton and the South Ocean Resort properties, adding that he expected to meet with “would be purchasers” of the former as early as today.

Mr Christie did not reveal who the potential purchasers were, but said: “I am encouraged over negotiations taking place with respect to the Hilton hotel and the South Ocean resort.

“I am even more convinced that we can look forward to developments taking place in that area, and I expect as early as tomorrow [today] to meet with would-be purchasers to discuss the future of, most certainly, the Hilton hotel and anticipating that we’re going to have significant economic interventions”.

He added that these developments made the work of the National Training Agency vital in “ensuring that young Bahamians, particularly, are integrated into the economy a meaningful way”.

Tribune Business reported last month that the investors behind the Nassau Palm’s purchase have submitted a multi-million dollar offer to buy the nearby British Colonial Hilton, Tribune Business can reveal.

The Sunset Equities consortium was said by sources familiar with developments to be one of two groups competing to purchase the 288-room property that is very much the ‘anchor property’ for Bay Street and downtown Nassau.

Their rival is said to be a London-based group, Musketeer Ltd, which is headed by Irving Aronson, a South African who worked with Sir Sol Kerzner, Atlantis’s developer, when they were in their formative accounting days.

“There are two offers,” one source told Tribune Business of the protracted sales process for the British Colonial Hilton. “One of them is from the London group [Musketeer Ltd], and the other is from the New York group.”

That latter group is Sunset Equities, which at end-May completed the purchase of the Nassau Palm on nearby West Bay Street, with plans to invest $8 million in its upgrade and transform it into a Marriott Courtyard brand.

The British Colonial Hilton is jointly owned by the Canadian Commercial Workers Industry Pension Plan (CCWIPP), the pension provider for Canadian supermarket workers, and Adurion, the Swiss/UK boutique investment house and private equity player.

Adurion has Board control, and Tribune Business sources previously revealed both shareholders were keen to exit by going through with the sale at the right price.

“The pension fund is anxious to sell it, but if they don’t get it priced at a certain amount, they will end up with nothing,” one source said yesterday.

“They still have a lot of money in the deal, but are hoping for a quick resolution.”

This newspaper previously exclusively revealed that a $74 million offer to acquire the British Colonial Hilton had been submitted by a multi-billion dollar New York-based asset manager, which was working with Roger Stein, whose RHS Ventures company previously made a failed attempt to take over development of New Providence’s still-closed South Ocean property.

That offer, though, has fallen away, with Musketeer and Sunset Equities the two remaining players in the game. It is unclear which way the British Colonial Hilton’s owners will lean, or if a sale will be concluded at all, given that the hotel has been for sale for around a year.

Colliers, the Canadian/US real estate firm engaged to market the British Colonial Hilton to potential suitors, has been heavily pushing the development opportunities offered by the 6.1 acres of seafront real estate immediately to the resort’s west.

It is also touting the $15 million, or $52,000 per room, investment in upgrades to the British Colonial Hilton in 2010, plus a further $2 million that was kicked in during 2012.

Apart from the 288-room British Colonial Hilton itself, the assets for sale also include the 22,240 square foot Fort Nassau, and 83,300 square foot, Centre of Commerce office buildings.

And, to further sweeten the pot, there is the 6.1 acre parcel that “provides a unique and rare opportunity to acquire significant oceanfront real estate assets with prime development land in downtown Nassau”.

Describing the British Colonial Hilton “as the landmark building of Nassau, strategically positioned in the heart of Nassau’s financial district overlooking the Nassau Harbour”, Colliers added that it was “Nassau’s only full-service business hotel with resort-inspired amenities”.

The realtor said the deal was “further distinguished by its rare 6.1 acre undeveloped parcel in Nassau’s landlocked downtown.

“The lands provide a variety of exciting development options, including the potential for residential apartment and condominium developments, or new yacht marina, to name a few.”

And Colliers added: “The hotel and office components provide strong and stable income, as well as excellent value-enhancing potential.

“Significant recent capital expenditures providing strong continued upside in operating performance.”