By NEIL HARTNELL
Tribune Business Editor
The New Providence Road Improvement Project’s so-called ‘cost overruns’ really total $300 million when the impact on affected businesses is factored in, a former leading retailer believes.
Sandy Schaefer, principal of the now-closed Robin Hood operation, told Tribune Business that looking solely at the over $100 million cost overruns on the construction budget underestimated the “so profoundly negative” impact on the private sector.
Praising the Government for “taking the high road” and “doing the moral thing” in seeking to compensate affected businesses via a $15 million package of tax/fee breaks, soft loans and reduced utility bills, Mr Schaefer indicated he was waiting on a final solution before moving on plans to re-open the former Robin Hood outlet on Prince Charles Drive.
He disclosed, though, that the still-closed store was among the latest to fall victim to copper thieves, who had caused an estimated $200,000 worth of damage and “poured salt into an open wound”.
“I think they’re doing the moral thing,” Mr Schaefer said of the Government’s proposed $15 million compensation offer. “There’s a moral issue. When something has to get done, you don’t get things done at any cost and any price, just because you can get it done and you’re in power.”
That was a reference to the former Ingraham administration, and Mr Schaefer suggested the suffering endured by many businesses was one factor why the Free National Movement (FNM) failed to retain power in the May 2012 general election.
“I am but one of the hundreds of businesses that were impacted, terribly impacted,” he told Tribune Business. “For us, it was more visible because people saw the store opened and then closed.
“What the Government is doing is right, it’s the moral thing, it’s the high road. It’s an expense that could have been avoided but, at the end of the day, it’s ultimately going to be the Bahamian taxpayer that pays.”
Current estimates have pegged the New Providence Road Improvement Project’s total construction costs at anywhere between $206 million and $235 million. Either figure is more than $100 million over the forecast budget, and is a burden Bahamian taxpayers will have to carry for years.
While few would dispute that New Providence has a much-improved road infrastructure that will reduce travel times and improve traffic flow, the cost of achieving this has been great - particularly in terms of closed businesses and staff redundancies.
“It was so far reaching that to put it at $100 million over budget doesn’t count the negative financial impact for all businesses concerned,” Mr Schaefer told Tribune Business. “When that’s factored in, it’s $300 million over budget.”
The opening of Robin Hood’s second store on Prince Charles Drive in early 2010 coincided with the start of roadworks in that area. The loss of easy customer access to the store was certainly a factor in its abrupt closure several months later, as it was for many businesses in that location and others, such as Robinson Road, Market Street, East Street and Blue Hill Road.
The loss of that store was also one of many factors in Robin Hood’s closure earlier this year, after the retailer suffered a $3.6 million net loss during its last year in business. But, seemingly undaunted, Mr Schaefer told Tribune Business in September that he was looking to open the Prince Charles site under the ‘Shepherd’s Mart’ brand.
Praising the Christie administration for appearing “genuinely interested in doing something to mitigate the damage that occurred”, Mr Schaefer last week confirmed he had talked to the Government on the issue. He then appeared to link the roadworks compensation to the potential ‘Shepherd’s Mart’ opening.
“We’ve had discussions with them [the Government], and I’m just waiting,” he said. “But we’re working. We’re working on quite a lot of things, but I’m very hopeful.”
Yet, in common with Super Value owner, Rupert Roberts, and his former Summerwinds Plaza landlord, Leslie Miller, Mr Schaefer’s store re-opening plans have been hit by copper thieves.
“Unfortunately, we were robbed of copper wire just like Leslie,” he disclosed to Tribune Business. “They steal $2,000-$3,000 worth of wire, and cause $200,000 worth of damage.
“It happened last week Tuesday, and I’m waiting for the estimates to come in. They actually went into the building and cannibalised the refrigeration in the building, and took the wire from inside and outside the building.
“It was sheer vandalism, but was like pouring salt in an open wound. We keep getting knocked down, and keep getting back up.”
Mr Schaefer had previously told Tribune Business that the former Robin Hood on Prince Charles Drive would require a $1.75 million investment to re-open it, a move that could create 170 jobs.
Everything, though, was subject to obtaining the necessary financing, and Mr Schaefer’s original target of a pre-Christmas 2012 opening now appears unrealistic.
He indicated, though, that he still has big plans for the site, which is the old Pepsi-Cola plant location. These plans include constructing a “world class shopping centre” at the site, a move that could ultimately see 350-400 Bahamians employed.