The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Grand Bahama’s hotel industry has lost 30 per cent of its summer market due to Vacation Express’s pull-out, the island’s Tourism Board chairman yesterday warning that the sector faced a “devastating” 2017.

The tour operator’s summer programme delivered more than 236,000 total room nights to Grand Bahama over the past three years, and its withdrawal has deepened the pain for a tourism industry already struggling with the Memories and Grand Lucayan closures.

Russell Miller, the Grand Bahama Island Tourism Board’s chairman, told Tribune Business yesterday that the industry had been hoping Vacation Express would “pick up some of the slack” caused by the loss of its two major hotels.

Pointing out that the key winter 2016-2017 season had already been missed due to the resort closures, he said Grand Bahama’s tourism industry was “in a bad situation” that was unlikely to be reversed in the short-term.

Mr Miller said the remaining hotels were working with their travel partners to come up with attractive vacation partners, and negotiating with the remaining airlines to increase flights to Grand Bahama.

There are also hopes that Bahamasair can provide additional airlift, but Mr Miller said finding a replacement for the “affordable airlift” that Vacation Express provided from 13 US cities at such short notice will likely prove difficult.

“I will tell you that we’ve already lost the winter season because of Memories and the Grand Lucayan not re-opening, and now on the heels of that we got wind that the summer programme was discontinued, which means the summer season has gone away and will be lost,” Mr Miller told Tribune Business.

“We thought there was an opportunity [with Vacation Express] to pick up some of the slack, but now that’s gone. This year is devastating for the hotel and tourism industry. It’s bad. It’s a bad situation.”

Mr Miller added that “still to this day” no one knew when the Grand Lucayan and Memories properties would open, “if at all”.

Prime Minister Perry Christie, speaking at a Friday meeting to ratify PLP candidates for the upcoming general election, pledged that the Government was “working around the clock” to address the problems caused by the resorts’ closure.

He added that the Government was in negotiations with a potential purchaser of the Grand Lucayan, thought to be the Canadian-based real estate developer, the Wynn Group, and promised that his administration was “making progress”.

However, Mr Christie made no mention of whether the Grand Lucayan’s owner, Hutchison Whampoa and its Cheung Kong Property Holdings affiliate, were willing to negotiate a sale at a price and terms acceptable to prospective purchasers.

The hotel closures have acted as the ‘cause’ in producing the ‘effect’ of much-reduced business levels for retailers, restaurants and other tourism-dependent businesses, as well as the summer programme’s cessation.

Tribune Business last week exclusively revealed that Vacation Express, described as Grand Bahama’s “largest supplier of room nights”, had pulled out as a result of the Memories/Grand Lucayan closures leaving the island without enough hotel rooms to meet visitor demand.

Rembert Albury, a Grand Bahama Island Tourism Board consultant, told Tribune Business last night that the tour operator had accounted for almost one-third of the hotel industry’s business volumes during the ‘slower’ summer season.

The Vacation Express programme, which started in 2014, covered the period from May to October, generating more than 236,000 rooms over those three years.

Mr Albury said Vacation Express brought 68,587 room nights to Grand Bahama in 2014, and peaked the following year at around 110,000, before dropping to 57,800 in 2016 - a figure influenced by Hurricane Matthew’s arrival.

“Although we were running behind 2015, it was still doing pretty good,” Mr Albury said of the Vacation Express programme. “The hurricane just killed it.”

Asked how big a market share Vacation Express accounted for over the May-October period, he replied: “I would say it’s approximately 30 per cent of the market.

“It’s a big impact. We are trying to fill the current airlines that we have coming to the destination, working with them to run some promotions to increase load factors.

“That’s what we’re doing until something happens with the two resorts being open, the Grand Lucayan and Memories.”

Mr Albury said that with Memories’ 492 rooms, and the Grand Lucayan’s Breakers Cay possessing 692, more than 1,100 hotel rooms had been taken out of Grand Bahama’s inventory.

Mr Miller echoed Mr Albury’s comments on how the Tourism Board was seeking to minimise the Vacation Express impact, but emphasised there was only so much that could be done at such short notice.

“We’re talking to the airline carriers we have now,” he said, “ to see if we can get additional services to the destination, and as the Minister of Tourism’s statement said, there’s negotiations to see if Bahamasair can add some airlift to the destination.

“The hotels are all working to come up with packages for visitors looking for a getaway destination.....”

Mr Miller said the ‘short notice’ meant the success of these initiatives was uncertain, adding that while Bahamasair was supposed to launch flights from Orlando to Grand Bahama in April, there had been suggestions this will be delayed.

“We’re doing well with the cruise and ferry business, but even that is not to the level it needs to be and should be,” Mr Miller told Tribune Business, “and it’s not to the level to offset the air seats we’re going to lose.

“The key thing is that you have to have affordable airlift to get visitors here. They [Vacation Express] did airlift and the hotel from 13 cities in the US.

“It was proving to be hugely successful until the uninvited and unexpected arrival of Matthew. We were trending to have a very good year,” he added, pointing to the improvements in key tourism indicators.

“It all fell apart with Hurricane Matthew, and we’ve not recovered to this point. A number of hotels are open, but when you have your two anchor properties down, it’s a big problem.”

When it was suggested that Grand Bahama’s tourism economy had hit bottom, and the only way now is ‘up’, Mr Miller said: “I used to tell people it’s this bad, and can’t get any worse. I’ve had to eat those words a couple of times.”