The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Grand Lucayan must be sold within “the next two-three weeks to save” Freeport as a tourist destination and its upcoming winter season, a leading resort executive warned yesterday.

Magnus Alnebeck, Pelican Bay’s managing director, told Tribune Business it was “now crunch time” for resolving the Grand Lucayan’s fate and Freeport’s tourism future.

He said its nine-month closure post-Matthew, and the loss of Memories, had been an “absolute disaster”, and warned that Grand Bahama “as a [stopover] tourist destination will probably not survive” unless the Lucayan strip quickly re-opens.

Mr Alnebeck said that while Pelican Bay was currently full, its customer base relied more on business travellers and persons who “have a reason” to visit the island.

He expressed concern that the lack of room inventory, with more than 1,000 rooms or 59 per cent of Grand Bahama’s capacity currently off-line, would ultimately impact his property because airlines would have less reason to service the island.

Mr Alnebeck said Freeport needed “at least 4,000 hotel rooms” to be regarded as a tourism destination, yet it currently has just 500 that are available - one-eighth, or just 12.5 per cent, of what is required.

“The reality is that we are doing well in the short-term,” he told Tribune Business of Pelican Bay, “but for the destination it’s an absolute disaster.

“If the [Lucayan] strip doesn’t open again, Grand Bahama as a tourist destination will probably not survive. If it doesn’t open up, the destination will not survive.”

Mr Alnebeck gave full support to the views of Freeport-based attorneys, Terence Gape and Carey Leonard, both of whom have warned that the Bahamas’ second city is facing an economic crisis unless the Grand Lucayan’s re-opening - and possible sale - are resolved soon.

“It’s crunch time now,” the Pelican Bay chief told this newspaper. “Terry Gape was quoted, and Carey Leonard was quoted. I can only say that their description of the situation is spot on.

“I think that if parts of the Grand Lucayan are not open by the winter season - unless something is open by the winter season - it’s going to be very hard to turn around.

“In the next two to three weeks, there needs to be a sale [of the Grand Lucayan] to be able to save this.”

Kwasi Thompson, minister of state for Grand Bahama, who appears to be the Government’s ‘point person’ on the Grand Lucayan situation, told Tribune Business on Tuesday that the Minnis administration felt it was “almost there” in resolving the resort’s fate.

While he declined to go into specifics, high-level government sources had previously told Tribune Business that the Wynn Group, the Toronto-based developer that is among the Grand Lucayan’s potential purchasers, submitted a proposed ‘Heads of Agreement’ to the Minnis administration last week.

Tribune Business contacts familiar with the Grand Lucayan situation were yesterday less optimistic than Mr Thompson, though, suggesting that Wynn had yet to sign a sales contract with the resort’s current owner, Hutchison Whampoa’s property arm.

Mr Alnebeck, placing the situation in context, told this newspaper: “For the national economy, I think this is more important than Baha Mar, but you’ve already used that headline.

“Freeport is not like Nassau. We’re not afraid of being robbed. We’re used to social infrastructure that works, and if we don’t a big part of that hotel open we’re going to have a tumultuous winter.”

Mr Alnebeck said that while Pelican Bay would be “fine in the short-term”, it would ultimately suffer like all resorts and tourism-related businesses if Freeport lost its standing as a visitor destination.

He added that the resort would only cater to the likes of Grand Bahama Shipyard workers and employees at the island’s other industrial companies, pointing to the negative impact reduced hotel capacity has on airlift.

“At the most we have 500 rooms open,” the Pelican Bay chief told Tribune Business of Freeport’s total inventory. “What airlift can you keep on, having just 500 hotel rooms open?

“We need a destination that has at least 4,000 hotel rooms. If not, it just doesn’t work.”

Mr Alnebeck said Cheung Kong Property Holdings, the Grand Lucayan’s current owner, had done little to nothing to repair the property and re-open in the nine months since Hurricane Matthew’s early October 2016 passage.

He praised the Minnis administration for seemingly understanding the situation’s urgency for Freeport and its people, but added: “The question is: What can they do very quickly?

“They have tried during six weeks in office to get it back on track, but we have to keep on keeping their feet to the fire.”

The near nine-month closure of the Grand Lucayan’s Breaker’s Cay property, and much of the Lighthouse Pointe section, together with Memories subsequent pull-out and loss of hundreds of jobs, has had a devastating effect on Freeport’s economy and society. Some are predicting that the city will hit “the point of no return” if the Grand Lucayan is not sold and re-opened by Christmas.

And several Port Lucaya Marketplace vendors have predicted that 95 per cent of tenants “will not survive another two months”, given their dependency on a resort customer base that has all but dried up.

Many observers believe the Grand Lucayan’s re-opening should be the Minnis administration’s leading national economic priority, given that the situation has the potential to derail its long-term plans for Grand Bahama if it persists much longer.

The new government has placed Grand Bahama at the centre of its economic revival strategy, with plans to market the island to three separate tourism niches, plus attract the film/TV industry and financial services.

This, though, will all be for nought unless the current decline is arrested.