The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Xanadu Beach Resort’s owner is anxiously waiting to see whether the property’s $30 million sale to a US-based entrepreneur can be closed, Tribune Business can reveal.

Mario Donato was said by sources close to developments to have his “fingers crossed” that the Grand Bahama property’s purchase by Kyle Houts will complete.

“There is a contract in place and a deposit in place,” one Tribune Business source familiar with the situation revealed.

They confirmed that the purchaser was Mr Houts, and the contract stipulated a $30 million sales price - the sum sought by Mr Donato when he first placed the Xanadu on the market in 2011.

Tribune Business was told that Mr Houts has paid a $300,000 deposit, equivalent to 1 per cent of the purchase price. However, this newspaper was told that the buyer has “got to prove his money” - meaning that he needs to provide proof of financing.

Mr Donato has been seeking to sell the Xanadu Beach Resort, which is now closed, for at least four to five years. Its acquisition, and a successful re-opening, would provide a major boost for Grand Bahama’s hotel and tourism economy, following closely behind the Memories deal that was sealed last year.

Tribune Business has been unable to uncover much information about Mr Houts to-date. Internet searches turned up several ‘Kyle Houts’s’, but none seemed an obvious purchaser of the Xanadu.

The US-based entrepreneur does not appear to have a significant ‘track record’ in resort/real estate development or management, and Tribune Business contacts on Grand Bahama - including those familiar with the Xanadu purchase - have little information either.

The only detail this newspaper has been able to learn is that Mr Houts is the beneficiary of a $200 million trust fund.

Khaalis Rolle, minister of state for investments, said he was aware that the Government was expecting to receive an application for approval of the Xanadu’s purchase.

“I’m aware that it’s either here already or coming in,” Mr Rolle said, in response to Tribune Business inquiries. “I’m not sure who it [the buyer] is.”

Featuring 184 hotel rooms and suites when it closed, the initial Xanadu proposal also offered the full service marina and its 72 boat slips for sale. Some 17 acres was included in the offer, along with adjacent land.

The Xanadu also has a strategic location, sitting on the beach just 10 minutes from Grand Bahama International Airport. Its rich history includes eccentric former owner, billionaire Howard Hughes, who once lived on its top floor, plus a reputation as the party venue for Sinatra’s ‘Rat Pack’.

Meanwhile, Tribune Business can also reveal that Sir Jack was talking to a UK-based entity, Highgrove Securities LLP, over the potential sale of the Hayward Trust’s 50 per cent equity stake in the Grand Bahama Port Authority (GBPA) Group of Companies.

Highgrove Securities was only founded in 2011, and describes itself as a private investment house that was set up in the wake of the global financial crisis to funnel capital into private and public companies across Europe and North America.

Simon Whittley, a former senior Credit Suisse executive, who is listed as a Highgrove Securities partner, is understood to have been the main ‘contact point’ on the GBPA talks.

It is unclear how far the discussions advanced prior to Sir Jack’s passing, although Prime Minister Perry Christie last week confirmed he knew the GBPA co-owner had been in sales talks.

Tribune Business sources also suggested that Highgrove Securities may have some relationship with Ireland’s wealthy Ryan family, as highlighted by this newspaper last week.