The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Democratic National Alliance’s (DNA) leader yesterday told Prime Minister Perry Christie to “stop talking foolishness and be real with the Bahamian people” over the $3.5 billion Baha Mar project’s likely fate.

Branville McCartney told Tribune Business that despite numerous promises by Mr Christie and his administration that the development would be open by Christmas 2015, and that things were “going to be dead good soon”, none of these would be fulfilled.

And he pointed out that his Baha Mar predictions had received recent backing from Standard & Poor’s (S&P), with the credit rating agency forecasting that any material impact for the Bahamian economy was at least two years away.

With $2.45 billion in debt already secured on Baha Mar’s real estate assets, and hundreds of millions of dollars required to complete construction, re-hire staff and market the property prior to opening, Mr McCartney agreed that the likeliest outcome was a sale to a Chinese investor group.

“No one has yet taken the bait,” the DNA leader told Tribune Business on Baha Mar. “It’s unfortunate, and again I think the Prime Minister and his band of merry men must stop painting this picture to the Bahamian people and be honest with them.

“They are trying to convince the Bahamian people that things are looking good at Baha Mar. That’s foolishness. The Prime Minister must stop and be honest with the Bahamian people, let them know what the deal is and the intricacies involved.”

While Mr Christie is correct that numerous hotel and investor groups are eyeing Baha Mar, visiting the property and meeting with both the receivers and their client, the China Export-Import Bank, Tribune Business sources close to developments have confirmed that no deal to move the project forward has been struck yet.

Mr McCartney said he had little hope that the Government would be totally forthcoming with the electorate on Baha Mar, given its failed promises on crime, mortgage relief and education reform.

Recalling the promises made by Mr Christie and his ministers about the ‘soundness’ of their Baha Mar liquidation strategy, and how it represented the fastest and most efficient way to complete the project and open it, the DNA leader said some 2,000 Bahamians had paid a high price by losing their jobs.

“I think at the end of the day, the Prime Minister must stop it and be real with the Bahamian people,” Mr McCartney told Tribune Business.

“He said in July that this place would be open by Christmas this year. He said things would be ‘dead good in the Bahamas soon’. Are things ‘dead good’, Mr Prime Minister?

“People are hurting out there. People relied on them for the past three years to do what they said they were going to do. Enough is enough. Stop talking, and stop giving people false hope,” he added.

“Things are dead in business, employment and we have a number of people dead because of crime. Things are not good in the Bahamas. At this stage, things are not better in the Bahamas.”

Tribune Business sources familiar with the present Baha Mar situation on Wednesday said that while numerous investor and hotel groups were showing interest in the $3.5 billion development, none had struck a deal with the China Export-Import Bank.

Speaking on condition of anonymity, they predicted that the China Export-Import Bank had two options over Baha Mar - reach an agreement with an operator/manager to complete the project and run it, or sell it to a buyer.

The source predicted that due to the $2.45 billion debt load, and likely near $1 billion investment required to complete and open Baha Mar, most Western hotel groups and buyers would be deterred from purchasing.

As a result, they forecast that the only buyer interest would come from Chinese investor groups and companies who, in return for making the bank ‘whole’, could be repaid with concessionary loans at low interest rates back home in China.

“Another Chinese group is in town this week to look at the property,” the source said. Tribune Business also previously reported that a Chinese group had partnered with MGM in a bid for Baha Mar.

“There are a number of people looking around,” the source confirmed. “The receivers are figuring out what the options will be with the property. There’s certainly keen interest from a number of parties. A lot of people are looking at it and showing interest.”

Raymond Winder, one of the Baha Mar receivers, confirmed that they were still receiving expressions of interest over the property.

“People are coming in,” the Deloitte & Touche managing partner told Tribune Business. “That process is just ongoing. We’re basically assessing all our options.”