The Tribune

BY Neil Hartnell

Tribune Business Editor

nhartnell@tribunemedia.net

Royal Caribbean has closed its $30m acquisition of Freeport’s long-shuttered Xanadu Beach Hotel, it has been revealed, and is near to completing the purchase of adjoining land parcels from the Royal Oasis owner.

Well-placed Tribune Business sources, speaking on condition of anonymity, told this newspaper that the cruise giant closed the resort’s purchase from the family of late businessman, Mario Donato, at the end of May 2026 as part of its ambitions to establish a private Grand Bahama destination for its passengers that will be similar to both its own Royal Beach Club on Paradise Island and Carnival’s $600m Celebration Key project.

And Royal Caribbean is also understood to be in the final stages of completing its separate deal with Harcourt Developments, the Irish-headquartered property developer that owns the Royal Oasis, and its financiers to complete the necessary land assembly for a development that the Central Bank last year said involves a $348m investment.

Royal Caribbean, in a guarded response to Tribune Business inquiries, neither confirmed nor denied the Xanadu’s purchase had closed but signalled that it is making moves. “We are always assessing our portfolio and continue to explore future projects to offer the best vacation experiences for our guests and drive economic growth in the communities we visit,” a Royal Caribbean Group spokesperson said.

However, it was confirmed to this newspaper that Royal Caribbean is the new owner of the Xanadu and 18 associated acres since the beginning of this month. “The property has changed hands. It’s all done. It’s all up to them now,” one contact said of the cruise line. “It was $30m, and they also bought 18 acres.”

Tribune Business understands that the cruise line and its high-end affiliate, Celebrity Cruises, are in the final phase of acquiring around a further ten acres from Harcourt Developments, which owns multiple land parcels running down to Princess Isle. These will be combined with the Xanadu to create a 28-acre beach break and entertainment destination catering to the cruise line’s passengers.

Well-placed sources confirmed to this newspaper that the Harcourt Developments part of the transaction is now just awaiting sign-off and execution of the necessary documents. “I believe the Xanadu hotel is closed,” one said. “I believe the other lands on Xanadu Beach are very close to being closed. I believe the documents have been sent to Europe, and it’s very close if not closed already. If it hasn’t closed, it’s very close.”

However, the contact tempered expectations by predicting that Royal Caribbean will take its time to develop the project and any development is unlikely to be completed until 2028 at the earliest. The cruise giant is also involved, and remains a partner in, plans to upgrade Freeport Harbour’s berthing capacity alongside Mediterranean Shipping Company (MSC), which is investing $450m to develop Billy Cay into a tourism destination.

“Royal Caribbean will be able to tie their boats up in the harbour and ferry people around,” one source said. “They will have their own private destination for their passengers. Royal Caribbean were the first to make that concept work. Things are moving ahead quite well for Freeport. I think that, in the next three months, it will all come together.”

The Central Bank of The Bahamas, in its presentation on 2025 first quarter economic developments, disclosed that Royal Caribbean and its Celebrity Cruises affiliate have received the Davis administration’s permission to proceed with the acquisition of a total 40-acre site that they intend to transform into “recreational and entertainment facilities”.

“Royal Caribbean Cruise Lines - Celebrity Cruises Inc obtained approval for the acquisition of 40 acres of privately-owned land for the development of recreational and entertainment facilities. The investment is valued at $348m,” the Central Bank confirmed. Should the Royal Caribbean/Celebrity Cruises transaction close, and the development proceed, Grand Bahama and Freeport could potentially become host to not just one but up to three private cruise ports and destinations.

Besides Carnival’s $600m Celebration Key, the island could now ultimately play host to both the Royal Caribbean/Celebrity Cruises project as well as MSC’s plans to develop Billy Cay into a new cruise port and amusement park. The latter is also acquiring the 20-acre Breaker’s Cay portion of Freeport’s Grand Lucayan resort from Concord Wilshire for development into a beach break-style excursion for its own cruise passengers.
The Harcourt Developments land parcels are also vital to Royal Caribbean and Celebrity Cruises’ ambitions. 

“If you look at the map you will see Xanadu at one end and four more ten-acre pieces going down to the west to Princess Isle. Harcourt Developments owns the next two,” one source told this newspaper. Tribune Business was subsequently informed that Harcourt controls all the property between Xanadu and Princess Isle.

Built in 1968 by US shipping tycoon, D. K. Ludwig, the Xanadu established itself as a venue for the so-called “Rat Pack” - the likes of Frank Sinatra, Sammy Davis Jnr, Cary Grant and Dean Martin - as well as accommodating reclusive billionaire Howard Hughes, who once lived in its 13th storey penthouse.

The 184-room property was acquired by Mr Donato in 1987, but it ultimately closed in 2011. The Xanadu was in late 2023 listed for a $25m asking price on Bahama Islands Properties’ website, which says: “The 184 rooms has it all.

“Set on a world class beach, it also boasts a 75-slip marina with incredible potential, and in addition more than 20-plus acres strategically located near downtown and the airport. It is perfect for aggressive rooms and amenities expansion or adding condominiums.” Another realtor, James Sarles Realty, had the resort listed for $35m.