The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Government's tourism re-opening plans were yesterday dealt a major blow after Baha Mar told staff its October return was "not achievable" due to COVID-19 spikes here and in key US markets.

The Cable Beach mega resort, and its Melia Nassau Beach property, hinted strongly they may not re-open until Christmas at earliest - and possibly not until 2021 - as they informed non-unionised staff they will receive 30 percent of their base salary as an "ex-gratia" payment for up to a further 90 days.

Daniel Lozano, the Melia's general manager, told staff in a September 10 letter that the decision to further delay the property's re-opening to an undetermined date had been driven by Baha Mar's analysis of current COVID-19 infection rates both in The Bahamas and its key US tourism source markets.

He added that Baha Mar's initial expectations that COVID-19 would have been under control by October have not been realised, and the resort developer/owner had to prioritise the health and safety of both guests and staff.

"Difficult decisions must be made to protect those who are most important to us," Mr Lozano wrote. "This is why I am announcing that the re-opening of the Melia will be further delayed to preserve the safety of our associates and guests.

"This is a decision that was not made lightly, and we understand that it may come as a disappointment to many. It is a choice that was made based on the most recent assessment of the current state of COVID-19 cases here in The Bahamas and in our key US markets."

He continued: "In June, it was our goal to re-open in October. That goal is not achievable under the current circumstances. Our expectation was that the virus would have been controlled by this point which, unfortunately, is not the case.

"Please be assured that our desire and intent to open the resort as soon as it can be done safely, and in a way that allows our guests and associates to do so with the peace of mind we all yearn for in this tumultuous time."

Mr Lozano acknowledged the extra financial and mental stress the delayed re-opening was likely to cause Melia staff, adding: "We understand that this kind of uncertainty is difficult to live with. We want to assure you that we are doing the best that we can.

"To that end, we are once again providing all non-union, full-time associates an additional 90 days, 30 percent of base compensation as an ex-gratia payment, in addition to any payments being offered by the Government of The Bahamas' Ministry of Finance emergency relief fund."

Mr Lozano said the Melia would continue paying health, life and accidental death insurance premiums on behalf of staff, and pledged to work closely with The Bahamas Hotel, Catering and Allied Workers Union (BHCAWU) on the provision of benefits and financial assistance to unionised staff. He said a further update on a possible opening date would be forthcoming next month.

A similarly-worded message was sent to thousands of Baha Mar staff by the mega resort's president, Graeme Davis. “There are no perfect decisions in our current climate, but there are ones that allow us to put the well-being of those we care about first,” he wrote.

“This is why I am announcing that the re-opening of Baha Mar will be delayed further in order to preserve the safety of our associates, community and guests. While this is a great disappointment to us all, it is a choice we make with a heavy heart after a sober assessment of the current state of COVID-19 cases here in The Bahamas and in our key US markets.”

Baha Mar's decision, coming just days after Dionisio D'Aguilar, minister of tourism and aviation, announced that his ministry is recommending all hotels and their beach amenities be allowed to re-open from October 15, will dilute the impact of the industry's return to business.

Sir Franklyn Wilson, the Arawak Homes and Sunshine Holdings chairman, last night described Baha Mar's decision as "very troubling" given that K Peter Turnquest, deputy prime minister, said on Wednesday that any failure to "jump start tourism" before year-end will create "a more troublesome scenario" for the Government's economic and fiscal plans.

"If you take a few statements made in the last 48 hours, it's very troubling," he told Tribune Business. "The fact that the minister mentioned the date of October 15, he didn't say the hotels are going to open then. He said that's the recommendation of his ministry to the Government.

"The minister of finance [Mr Turnquest] says the plans of the Ministry of Finance will really be challenged by the end of the year if things haven't kicked in for the sector being opened from October 15. He said, if I understood it properly, that the Ministry of Finance did modelling on the basis something is going to happen by October/November.

"Now [Baha Mar] is saying they will give 90 more days of ex-gratia payments. Presumably that's saying to the Ministry of Finance you may want to update your modelling as you were projecting that by the end of the year there will be some impact from tourism."

Mr D'Aguilar could not be reached for comment despite numerous attempts yesterday, but earlier this week he told Tribune Business that the tourism and hotel sectors' re-openings could not afford to wait or "be beholden to" the timelines that suited Atlantis and/or Baha Mar.

However, The Bahamas' two mega resort flagship properties are typically viewed as a bellwether, or gauge, of the strength and confidence of this nation's hospitality industry by travellers and external observers.

And many other Bahamas-based resorts often take their cue from Atlantis and Baha Mar, following their lead on re-opening decisions given that they are significant drivers of airline demand. Airlift supply at the time of the October 15 re-opening will likely be one element impacted by the Cable Beach resort's move, with Atlantis also still evaluating its opening options.

Just yesterday, Chris Morris, the Cape Eleuthera Resort and Marina's general manager, said: “I would love to hear from Baha Mar and Atlantis to know they are on track for the same date. They seem to be a barometer for the country in the eyes of the tourism market. Unfortunately, they have not yet confirmed for good reasons."

Given that Baha Mar has 2,336 rooms between its Grand Hyatt, Rosewood and SLS Properties, and the Melia has a further 694, the decision not to re-open in October takes almost 3,000 rooms out of New Providence's hotel room inventory for a further month at least, and possibly the rest of the year.

Baha Mar's move further highlights the questions, uncertainties and obstacles surrounding tourism's re-opening. Yet The Bahamas has little choice but to get the industry moving as rapidly as possible, as the pace of its COVID-19 recovery - jobs, growth and the foreign exchange earnings that support the US dollar currency peg - is hugely dependent upon it.