The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

An outspoken QC has been retained by the Port Lucaya Marketplace purchaser to determine if the deal needs to be approved by central government, with some elements in the Christie administration preferring a Bahamian buyer.

Fred Smith, the Callenders & Co partner, declined to comment when asked if he had been retained by Peter Hunt to render a legal opinion on whether the Hawksbill Creek Agreement - and the rights it confers on Freeport and the Grand Bahama Port Authority (GBPA) - mean he does not have to seek approvals from Nassau.

However, multiple sources confirmed to Tribune Business that Mr Smith has been retained by the UK-based real estate developer to explore all legal options after the purchase seemingly became stalled in the Government process.

Meanwhile, a Cabinet minister confirmed yesterday to Tribune Business that there had been discussions within top Christie administration circles about whether it was more preferable for Bahamians to acquire the Port Lucaya Marketplace.

Confirming that Mr Hunt’s purchase was supposed to go before the Cabinet/National Economic Council (NEC) this week, Khaalis Rolle, minister of state for investments, said there had been several government meetings on the deal.

“That’s being reviewed this upcoming week,” Mr Rolle told Tribune Business of the Port Lucaya Marketplace deal. “It’s set to be reviewed on Tuesday [at Cabinet].”

Asked whether there had been internal talks within government on whether the Marketplace was an asset that should be acquired by Bahamians, Mr Rolle revealed: “There were some discussions to that effect. We’ve had several discussions and meetings on it.

“I can’t say personally what the issues were.”

Tribune Business sources said Obie Wilchcombe, minister of tourism, and the West End and Bimini MP, was among Cabinet ministers who feel that the Port Lucaya Marketplace was an asset that should be acquired by Bahamian, rather than foreign, investors.

Mr Wilchcombe, whose brother is understood to run the security at Port Lucaya Marketplace, could not be reached for comment despite Tribune Business’s best efforts.

However, one source with knowledge of the Hunt purchase, speaking on condition of anonymity, told Tribune Business: ‘They [the Government] say they want a Bahamian to buy it, but if a Bahamian wanted to buy it they would have bought it. There’s no Bahamian buyer.”

Multiple sources in Freeport’s private sector have expressed alarm to Tribune Business that, with the city desperate for good economic news and investment of any kind, the Government was seemingly stalling on approving Mr Hunt’s purchase.

They added that the British investor was starting to get both itchy, and cold, feet over the deal amid concerns over whether the Bahamian government really wanted him as a buyer.

“They’re still very interested,” one source said of Mr Hunt and his associates. “They still want the deal. But right now, they’re afraid the Government may not want them.

“Every investor is afraid of getting so much resistance, when they’re prepared to spend these amounts of money.”

Another contact, speaking on condition of anonymity, added: “I understand the approval has not been obtained. Unofficially, I’ve been told that the Government says a Bahamian group should buy it.

‘It’s been eight months and it’s too bad, because new blood is always good.”

“I understand that Fred Smith is going to be retained to sue the Government,” one legal source said. “Everything is in, and the Government has not approved the deal.”

Mr Smith was silent when Tribune Business encountered him at the Nassau Yacht Club, and asked if he had been retained to explore Mr Hunt’s legal options.

However, informed sources suggested that Mr Smith’s legal opinion would be based on the Hawksbill Creek Agreement, and whether this allowed Freeport-based business deals to be approved solely by the Grand Bahama Port Authority (GBPA) without reference to central government in Nassau.

Tribune Business also understands that Mr Smith will assess whether the International Persons Landholding Act applies to Freeport.

The well-known QC touched on this issue during a Friday lunchtime address to the Rotary Club of East Nassau, when he said of Freeport: “It’s a state within a state, and many laws that apply to the rest of the Bahamas don’t apply to the Port area, such as the International Persons Landholding Act.”

Several Freeport sources, though, suggested that even if Mr Smith was correct on that assertion, it would prove of little use to Mr Hunt and other investors because the Government still controlled the ‘back end’ via exchange control approval.

The Port Lucaya Marketplace deal goes to the heart of the ‘Bahamianisation’ argument, and whether certain assets and businesses should only be acquired/owned by local interests.

And it also hits at the often-strained relations between the Grand Bahama Port Authority (GBPA) and central government, since Port Lucaya Marketplace’s vendor is Bourbon Street Ltd, a subsidiary of GBPA affiliate, Port Group Ltd.

The Marketplace is arguably Freeport’s leading retail and dining location. Mr Hunt’s UK firm is P & H Properties.

“He is a commercial real estate developer. He’s legitimate. He’s interested in seeing Freeport grow. He really loves Freeport. Everyone’s waiting on this [to complete]. Freeport needs it,” one source said previously.

Mr Hunt is already understood to have an investment interest in Freeport, having possibly acquired a residential property in the city.

Speculation surrounding the potential sale of Freeport’s Port Lucaya Marketplace has bubbled up ‘on and off’ for some time.

The facility features 40 stores and boutiques, 14 restaurants, six bars and three late night bars/lounges, plus three watersports operators.

Targeted at stopover visitors from the Memories and Grand Lucayan hotels, plus guests at other Freeport resorts, cruise ship passengers and locals, the Port Lucaya Marketplace also has room for 110 straw and authentic Bahamian craft vendors.