The Tribune

• Royal Caribbean PI project to ‘hurt’ Bay Street

• Downtown Nassau chief: Get something in return

• But ‘in truth’ city’s offering not meeting standard

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Royal Caribbean’s Paradise Island plans are “a double edged sword” that could improve The Bahamas’ tourism product yet “hurt” Bay Street and local entrepreneurs, it was argued yesterday.

Charles Klonaris, the Downtown Nassau Partnership’s (DNP) co-chair, told Tribune Business the proposed Royal Beach Club project will effectively see the cruise line replicate the “all-inclusive” model pioneered by the resort industry through keeping thousands of its passengers within the confines of its own properties/activities.

Suggesting that Bay Street merchants, Arawak Cay and Junkanoo Beach vendors, the Straw Market and other businesses/workers whose livelihoods depend on the cruise industry could all “suffer” from the potential loss of customers, he acknowledged that Royal Caribbean’s development is “a concern” and “not good for the city”.

Mr Klonaris urged that, in return for approving the Royal Beach Club, the government should stipulate that Royal Caribbean’s vessels remain at Nassau’s port overnight so Bahamian entrepreneurs receive some business.

He argued that the government should use the Paradise Island project, coupled with the Bahamian private islands belonging to Royal Caribbean and its rivals, to “strengthen its bargaining hand” in negotiations with the cruise industry to ensure locals “get something in return” - especially since COVID-19 has made these assets even more valuable for when South Florida voyages resume.

However, besides the “downside”, the DNP co-chair acknowledged that Royal Caribbean’s “beach break” destination could also generate “positives” by improving The Bahamas’ tourism product and quality of the guest experience if it offered something that no competing regional destination can match.

He also admitted that downtown Nassau is “in truth not providing a good product” for cruise passengers and other visitors for when tourism starts to rebound in earnest following the devastation inflicted by the COVID-19 pandemic.

Speaking after Tribune Business revealed that Royal Caribbean plans to begin construction on Paradise Island’s western end by July 2021 if all necessary government approvals can be obtained, Mr Klonaris said the project would only further increase the number of cruise passengers ferried across Nassau Harbour. Pre-COVID, Atlantis’ water park had proven the major draw.

“I don’t seek anything positive coming out of it apart from maybe the job opportunities for Bahamians over there,” he told this newspaper. “For the shopping, I don’t see it. This is a concern that these cruise ships, between their private islands and beaches, it’s in essence like an all-inclusive hotel where they cater to their passengers and it’s not good for downtown.

“The only good I see from that is for the quality of the tourist experience in The Bahamas, but for shopping downtown and eating in restaurants, I don’t see it at all. It’s not good for the city. Think of Junkanoo Beach, the Tiki hut and all the Bahamian vendors there. Now they’ve got a competitor. Think of Fish Fry. All of that will be affected by this. I can see those entities suffering. It’s going to hurt downtown, it’s going to hurt Junkanoo Beach, the Straw Market.”

Royal Caribbean, according to documents filed with the Department of Physical Planning ahead of the April 28 public consultation on its application for the project’s site plan approval, aims to construct a venue that will cater to a maximum capacity of 3,500 passengers.

The Royal Beach Club’s amenities, which will be located on 13-plus acres of privately owned land plus a further seven to ten acres it plans to lease from the Government, include two 35,000 square foot dining pavilions capable of accommodating 1,500 passengers each.

Other features include a 26,000 square foot pool; 4,000 square foot “splash pad” for children; 14 beach bars; restrooms and cabanas; and support infrastructure that includes a reverse osmosis plant, waste water plant, waste management facility, storage building and fuel storage all contained on two acres.

Mr Klonaris said Royal Caribbean passengers who visited the Royal Beach Club were unlikely to be inclined, or have the time, to undertake any other activities while in Nassau. “It’s like an all-inclusive hotel where the guests stay there and spend the entire vacation at one property,” he reiterated. “It’s not good for the city.

“My only thoughts on issues like this is that they’ve obtained a beautiful property; it should be a bargaining piece for the Government. It should give them the strength to bargain. When we see what is happening with those beautiful Paradise Island properties they should require them [Royal Caribbean] to stay overnight. There should be stipulations.

“We understand the importance of the cruise ships but surely there should be some consideration for broadening tourist spend through purchases throughout the city and outside the city. Surely the Government must be making stipulations. Perhaps they have but we don’t know,” Mr Klonaris continued.

“It’s time the Government says. We have a product in The Bahamas that’s so enchanting and compelling that we can bargain. It’s not a one-way street. We’re giving access to all these beautiful properties, some of the best islands in the world, but what do we get in return? That’s what the minister of tourism should be asking. It’s time we got something in return, and the Government bargains hard.

“It’s time the Government sat them down and said: ‘Hey, guys, this is what we want in return’. The employment will be good, having Bahamians employed at the restaurants and amenities over there, but that’s the level of what we get. Bus boys, bar tenders, waiters; that’s the level and the good part goes directly to those cruise lines.”

Many observers believe Royal Caribbean, seeing the success that Atlantis enjoyed pre-COVID by attracting hundreds of cruise passengers daily to its water park, has decided to secure a sizeable share of that business for itself when passenger volumes return to former levels via a Paradise Island opening in January 2023.

Concerns have also been raised that the Royal Beach Club project could be a bargaining chip between the Government and Royal Caribbean over the latter’s long-running bid to close the Grand Lucayan acquisition, although this has not been confirmed.

Mr Klonaris, though, conceded that Royal Caribbean will likely argue that it should be allowed to compete for the same business as Atlantis and create a destination that will encourage more passengers to disembark when in Nassau’s port.

“It’s a double-edged sword,” he told this newspaper. “We’re promoting The Bahamas, and the experience tourists will have on Paradise Island is something that you cannot duplicate anywhere else in the world.... What can you do? Once things start moving in a certain direction it’s hard to stop and I can see government allowing something to happen because of the competition to attract tourists.

“We need a good product, and right now in truth the city is not providing that. It will be hard to tell them ‘no’. If you look at the broader picture you can see the Government saying ‘go ahead’. You really cannot stop progress. We have to look at the long-term effects of something like this, building The Bahamas as a really first class destination, and we need facilities like this.”

Russell Benford, Royal Caribbean’s vice-president of government relations for the Americas, last year sought to head-off concerns such as those voiced by Mr Klonaris by telling Tribune Business that the Royal Beach Club’s impact will be the exact of opposite of what Bay Street merchants and tourism-related businesses fear.

Pledging that its $50m Paradise Island investment will generate an extra $26m per year in visitor spending and “re-energise” downtown Nassau for the benefit of all stakeholders, Mr Benford said that rather than creating an exclusive enclave where the cruise line will take all its passengers and retain 100 percent of their spending, it would instead act as an “engine to get people off the ship”.

With the Royal Beach Club able to accommodate 3,500 persons maximum once it is completed in 2022, Mr Benford explained that this number was equivalent to just 20-25 percent of the up to 14,000 passengers that Royal Caribbean brings to Nassau daily.

He said Royal Caribbean’s research indicated that passengers would spend a maximum four to four-and-a-half hours at the Royal Beach Club, giving them five hours to participate in additional activities given that its cruise ships are typically docked in Nassau for nine to nine-and-a-half hours.

Mr Benford also disclosed that the cruise line envisioned the Royal Beach Club as being at the centre of a water and land transportation loop that will ferry its passengers to attractions such as the Arawak Cay Fish Fry, Junkanoo Beach, The Pointe, Baha Mar and Graycliff, thereby ensuring their spending impact is distributed widely among Bahamian-owned businesses.