The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A former minister of tourism yesterday backed the Government’s proposed Grand Lucayan takeover as a ‘last resort’ option, saying simply: “Grand Bahama needs help.”

Obie Wilchcombe, the ex-West End MP, told Tribune Business he was “deeply concerned” that the potential purchase left behind by the former Christie administration appeared to have fallen through.

He said “tremendous strides” had been made in assisting the Toronto-based Wynn Group to agree the Grand Lucayan’s acquisition with its current owner, Cheung Kong (CK) Property Holdings, one of two companies into which Hutchison Whampoa has split.

Mr Wilchcombe disclosed that he had expected the Grand Lucayan to be repaired and opened by now, but several sources close to developments yesterday expressed little surprise that the Canadian-based real estate developer’s proposal had not proceeded.

They suggested that the Minnis administration had little confidence in Wynn’s ability to conclude a deal with CK Property Holdings from the get-go and, while giving it a chance, indicated in the Prime Minister’s national address that it had decided to move on and seek other solutions. 

“The Government took his hype very, very carefully,” one source, speaking on condition of anonymity, told Tribune Business. “They realised Wynn couldn’t do it, and didn’t want them as a player. They’ve been out for several weeks.”

Tribune Business revealed earlier this year that the Wynn Group had emerged as the front-runner to purchase the Grand Lucayan under the former Christie administration, with a $110 million purchase price being discussed, and talk of Memories and Hard Rock being involved as resort brand operators.

However, the deal never seemed to progress, despite a Letter of Intent (LoI) being signed for the purchase between Wynn and CK Property Holdings. The former paid a deposit, as is customary in real estate transactions, but Wynn’s suggestion that it is seeking to recover this sum suggests it was unable to close the purchase.

“I am deeply concerned,” Mr Wilchcombe said yesterday, both in relation to Wynn’s pull-out and the Grand Lucayan’s unresolved fate.

“I am aware of the dire circumstances in Grand Bahama that we were left with following Hurricane Matthew, and the fact we were trying to get Wynn to complete a deal with Hutchison (CK Property Holdings). 

“We were hoping by now that the property would be under repair and being prepared for the winter season coming. I’m deeply concerned, but I hold on to what the Prime Minister said in his national address: that the Government will be stepping up to the plate to assist.”

Mr Wilchcombe said the former Christie administration, of which he was part, had also considered that it might have to intervene through the Hotel Corporation of the Bahamas.

“We had given thought to it as well,” he said. “We realised we might not be able to wait for someone, and the Government might have to do it.

“We also suggested to Hutchison, Sunwing/Memories, and were also saying to Paul Wynn that the Government would be prepared to assist in the renovations, and to help the process, through the Hotel Corporation. We intended to do so.”

Acknowledging Grand Bahama’s continuing economic plight, Mr Wilchcombe added: “What do you do? The property is there, and the longer it goes on, you have to be concerned about the airlines falling back.

“The little airlift we currently do have, if they pull back going into the slow part of the year, what do you do? I think the Government will have to step in, but I support the Government stepping in.

“You have to provide job opportunities, otherwise you will see people leave Freeport in search of jobs and come to Nassau, and look to get in at the Rosewood and SLS. Grand Bahama needs help.”

Dr Minnis’s national address effectively indicated that the Government could no longer wait for the Wynn Group or other potential purchasers, and had decided to move on with its own solution that potentially involves taking an equity stake itself. 

Memories/Sunwing, Hard Rock and the Port Lucaya Marketplace’s owners have all been mentioned “as part of the conversation”, as the Minnis administration seeks a sustainable solution that will enable it to exit ownership quickly and avoid past pitfalls by creating a destination product.

Mr Wilchcombe, though, said the Christie administration felt it had left the Wynn Group well-placed to conclude a purchase agreement with CK Property Holdings.

“They had paid a deposit,” he added of Wynn, “and the Government had agreed at the Cabinet level in principle that it would support them in the process, as it was a step they needed in their negotiations.’

The former minister said the then-administration had worked with Wynn to refine its plans, with himself heading up a delegation - including the Ministry of Tourism’s permanent secretary and representatives from the Prime Minister’s Office - that flew to Toronto to meet the developer during the election campaign.

“They had negotiated with Hutchison, paid a deposit, agreed in principle, and we thought they’d agreed a price,” Mr Wilchcombe said. “We thought we had made tremendous strides, and thought the deal would be complete by now and the property open, but things happen.”

He backed the potential involvement of brands such as Memories and Hard Rock, adding that both would be good for Grand Bahama.