The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A prominent Grand Bahama hotel yesterday said its $3m room renovation has fallen victim to global supply chain disruption with a recent “lightning strike” creating further complications.

Magnus Alnebeck, Pelican Bay’s general manager, told Tribune Business that delayed deliveries - with furniture, fixtures and equipment sometimes taking three times’ longer than promised to arrive - was “causing problems” for a 48-room upgrade at the well-known property.

Forecasting that the project will likely be completed by March 2022, he added that relatively low visitor volumes meant the resort did not need to rush what represents just over 25 percent of its room inventory back into action.

But the Pelican Bay chief added that the supply chain woes were now likely to impact the property’s need for replacement information technology (IT) parts after a lightning strike some three weeks ago, and “hit” to the electricity system, knocked out sufficient computer-related equipment to consume all its previous “spares” inventory in the repairs.

“We are in the middle of doing a refurbishment at Pelican Bay doing 48 rooms, and yes, we are having problems with the delivery of certain items,” Mr Alnebeck said. “We are trying to be ahead of the curve with the day-to-day stuff we always need, and we are trying to stockpile for.

“But with the renovations we have problems with some things on back order, and not knowing when they are going to get here, so it’s definitely causing problems. It’s more furniture, fixtures and equipment (FFE) for the rooms, certain things that we find take longer to get here and are on back order.

“It’s difficult to say when you will actually get things. We often get the answer: ‘It’s on back order and will be here in four weeks’. Then it’s delayed for three weeks, and then delayed for another three weeks. What you thought would be four weeks ends up being six, eight, ten, 12 weeks.”

Pelican Bay’s total room inventory stands at 184, and Mr Alnebeck said the resort was in no rush to have the 48 under renovation back in service given current demand and bookings levels. 

“We’re not really in a rush because we don’t have the business levels yet,” he added. “It would be nice to get them done, but it is difficult to get things in. It has delayed the work, but it doesn’t really matter because we don’t need the rooms and have to take a bit of a ‘stop and go’ approach to it.

“The business levels in Freeport are not such that we need the rooms back. We’re doing the renovations because we want to be ready for what we hope to happen in the future, but we don’t have pressure that they must be ready at a certain date.”

Of the 48 rooms, Mr Alnebeck said 24 or half will become “long stay” equipped with a kitchenette so guests can do their own cooking. “There’s definitely a market for that in Freeport from corporate guests that are staying a long time and doing projects at the Shipyard,” he explained.

“We are investing in total in those rooms probably around $3m. It’s also new air conditioning plant, that sort of stuff.... It depends on worldwide delays, but we’re hoping to be ready in March even though we don’t like to be pinned down to a deadline.”

Revealing that supply chain woes extend beyond the renovations, Mr Alnebeck said: “We had a lightning strike three weeks ago. That came through the power system and we lost a lot of IT equipment. We had a lot of IT equipment in spares, and we’ll use that up, and want to have spares for the next time we have a problem, and have found out that is on back order.

“The world is a complicated engine to restart, and that’s what we’re doing at the moment. We’re trying to restart an engine that’s been shut down for a year-and-a-half. It’s not dissimilar to what’s happening with ourselves, getting the children back to school, getting back to a normal life. That’s what the whole world is trying to do at the moment.”