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Gov’T Wants South Ocean ‘Off Table’

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Government was yesterday said to remain “very anxious” for the owner of New Providence’s still-closed South Ocean resort to find a buyer, as it holds talks with a new round of potential bidders.

Khaalis Rolle, minister of state for investments, confirmed to Tribune Business that the Christie administration wanted the 383-acre property “off the table”, having been among its priorities when assuming office in May 2012.

This newspaper revealed in August 2014 how South Ocean’s current owner, the Canadian Commercial Workers Industry Pension Plan (CCWIPP), had been forced “back to square one” in its buyer search.

This resulted from the breakdown of negotiations with its then-preferred bidder, controversial Austrian financier Dr Mirko Kovats, who has a home in Lyford cay and owns other real estate in the South Ocean area.

CCWIPP (and possibly the Bahamas) paid a hefty price for this choice, as it effectively rejected two major institutional buyers with a strong track record of success in major real estate developments.

These were Argent Ventures, a private New York-based real estate developer, some of whose principals were involved in the $8-$12 million purchase and renovation of West Bay Street’s Nassau Palm property.

Argent has considerable means, owning the land under New York’s Grand Central Terminal. The company also owns the Capitol Records Tower in Hollywood, California, and Miami’s Omni International Mall.

The second institutional buyer was the joint venture between the Albany developers and Och-Ziff, the hedge fund and asset manager with over $40 billion in worldwide assets.

Och-Ziff would have provided the financing, while Albany’s developers (including Lyford Cay-based billionaire Joe Lewis’s Tavistock Group) would have provided management, operational and development expertise.

Tribune Business sources yesterday suggested that Albany’s developers were among the “second round of bidders” that CCWIPP was talking to, although this could not be confirmed, and it is unclear whether they are still in partnership with Och-Ziff or another entity.

Mr Rolle yesterday said the Government was unsure whether CCWIPP had “definitively” identified a new preferred bidder for South Ocean, which has been closed to paying guests for more than a decade.

“They [CCWIPP] have been in discussions with a second round of bids, but I don’t know where they are with that process,” Mr Rolle told Tribune Business. “I can’t say definitively.

“I think they’ve done a lot of work recently on the second round, but I’m not sure if they’ve identified anyone.”

Mr Rolle said finding a buyer who could fulfill the Government’s development vision for South Ocean had been among the Christie administration’s priorities since the general election.

He reiterated: “We’re still very anxious to have this one off the table.”

One Tribune Business contact familiar with developments at South Ocean yesterday confirmed to this newspaper: “There is definitely some activity on it. There are two or three people looking at it.”

Another source said CCWIPP and its advisors, the Miami-based CB Richard Ellis (CBRE) office, seemed confident that they had renewed “keen interest” in South Ocean and that a deal might be forthcoming.

Referring to the Canadian pension fund’s fatal decision to go with Dr Kovats, the source said: “Unfortunately, they made a terrible mistake with the bidder who was the first one chosen, and they turned away two large institutions who are private investors.

“We all know what happened. We knew from day one that it was the wrong move.”

The Government has long been frustrated in its and desire to make something happen at South Ocean, a development that could create hundreds of construction and full-time jobs if done right.

The Christie administration has previously considered “lowering the boom” on the pension fund, and threatened to strip South Ocean of its casino licence and various development rights in a bid to force a sale.

It has promised to grant New Providence’s third casino licence to the first viable, fully-funded project to come along - whether at South Ocean or elsewhere on the island.

Among the contenders for that is former MP and Cabinet minister, Tennyson Wells, whose multi-million dollar resort/theme park proposal at Coral Harbour is dependent on obtaining the casino licence currently vested in South Ocean.

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