The Tribune

By KHRISNA RUSSELL

Deputy Chief Reporter

krussell@tribunemedia.net

TOURISM Minister Dionisio D’Aguilar confirmed yesterday Brookfield Asset Management is again searching for a company to purchase the Atlantis Paradise Island Resort, after a prospective sale fell through last year.

According to the minister, “this is nothing new,” as he told The Tribune the firm “always has the property for sale”.

“Brookfield in an insurance company that makes strategic investments with the intention of selling them,” the Freetown MP said. “They always have the property for sale and are always looking to send it onward.

“I don’t think that they have secured the price they have been looking for. I think I am safe to say Atlantis is one of the crown jewels in their portfolio of holdings.

“While they are a motivated seller they want to ensure that they can get it sold for their asking price.”

Asked whether he saw the resort’s need for renovation as a hindrance to a sale, Mr D’Aguilar said: “A sale occurs when the purchase price is attractive to the purchasers, so a sale hasn’t occurred because the price isn’t attractive. There is a myriad of reasons why this is or isn’t the case.

“But I don’t think the renovation is a part of the issue. You factor it into the purchase price.

“Prospective purchasers they are looking for a deal and Brookfield is not prepared to let it go for just anything.”

A well-placed source yesterday said despite owning Atlantis for more than seven years, Brookfield continues to want the sprawling resort “off its hands” considering its expertise is not in the hotel business.

While the sale will inevitably raise concerns about the job security of the resorts 4,000 to 5,000 workers, the source said the government stood to gain “substantial” revenue from stamp duties attached to a transaction of this magnitude.

This comes after a Bloomberg report said last week that Brookfield was working with an advisor to solicit potential interest in the resort, that features multiple hotels, a casino and more than 10 swimming pools.

In late February, Tribune Business reported that a potential sale of Atlantis to a New York-based real estate investor, which was backed by Qatar’s sovereign wealth fund, fell through and was not going to be revived.

Ashkenazy Acquisition Corporation and its principal, Ben Ashkenazy, were spearheading the undertaking.

Ashkenazy, which was backed by Middle Eastern money principally from Qatar, walked away after it uncovered significant “deferred maintenance” issues when it conducted due diligence on Atlantis’s financials and real estate assets, Tribune Business was told at the time.

Had it proceeded with the deal, Ashkenazy and its financiers would have been required to spend significantly more in capital investments than they had initially bargained for, altering the economics and potential return on investment they were targeting.

As a result, Ashkenazy attempted to renegotiate the purchase price with Brookfield Asset Management, the Toronto-based asset manager that holds $330bn of global real estate and other properties, among which is Atlantis.

Tribune Business was told that Brookfield, a tough negotiator, was completely inflexible on price and refused to budge on any renegotiation, resulting in the potential purchase foundering.

Another source, also speaking on condition of anonymity in February, said Brookfield and Ashkenazy had managed to sign a letter of intent, with the latter given a 30-day due diligence period on Atlantis’s books and assets.

Tribune Business was told that Ashkenazy, whose investments include New York’s Plaza Hotel and Washington DC’s Union Station, together with other resort, office and retail assets in major cities throughout the US, had conducted due diligence to the extent it even conducted a scouting mission on Atlantis’s local competition - Baha Mar.