By AVA TURNQUEST
Tribune Chief Reporter
OPPOSITION Leader Philip Davis yesterday stressed the government’s purchase of the Grand Lucayan resort was a “waste of money” without a proper plan to justify how the money would be recouped.
Mr Davis questioned how the government could move to acquire the property, which has two of its three hotels shuttered, when it could not provide any details on the economic impact the purchase will have on Grand Bahama.
He claimed there would be no immediate benefit or economic impact for at least two years.
“They are dreaming and that dream is nothing but a nightmare for the Bahamian people.
“They are on an errand of folly,” he told reporters at Government House.
“This is being done without any coherent plan as to how they are going to, for example, recoup this money. What business plan have they developed? How will this be beneficial for the government at the end of the day? Have they settled a business plan to say, well the capital we are going to invest is $65 million?”
Prime Minister Dr Hubert Minnis revealed after a tour of the resort on Wednesday the government has made a $10m down payment to acquire the Grand Lucayan at a price tag of $65m. Dr Minnis said he expects to complete the purchase from owner Hutchinson Whampoa within the next 30 days.
He did not give many details about the purchase or specify the government’s plans for the three-hotel property, saying he will make a comprehensive communication when Parliament resumes after its summer break next month.
However, he said once the government’s acquisition is complete, a concessions package will be available to prospective buyers of the hotel, the terms of which will be more favourable to Bahamian investors than foreign ones.
The government is not considering re-opening the 500-room Breaker’s Cay, but will keep the 196-room Lighthouse Pointe open, and is considering re-opening the 400-room Memories property, he said.
Yesterday, Mr Davis noted anecdotal figures on the cost of renovations, ranging from $70m to $100m. He further underscored the decision to move forward with the purchase in the absence of any conclusive details as evidence of government’s shortsightedness.
Last week, Tourism Minister Dionisio D’Aguilar said the government was forced to act to save the Grand Lucayan hotel properties because its owner Hutchison Whampoa had been threatening to shut down the property.
At the time, Mr D’Aguilar stressed the move was “the best of a bad choice” in an “emergency” situation.
Mr D’Aguilar reportedly told The Nassau Guardian the government did not intend to renovate the property.
During Wednesday’s tour, Dr Minnis acknowledged the Memories property would require some renovations prior to reopening.
He said the government will assess the costs of reopening it before making a decision.
Yesterday, Mr Davis said: “What that means is they are sinking $65m into a property and then going to leave it there, for what? I mean $65m they spent being flushed down the toilet, and for what?
“What are the plans, what is the economic impact for Grand Bahama, to sink $65m in an entity that is closed? It’s not a going concern and there is a distinction to be made when you are acquiring property that is a going concern than one that is just shut and closed because you spend the $65m now you have to embark on renovations.”
Mr Davis continued: “That will take time. The impact of that will not be felt immediately, you will not feel it I dare say within the next two years. It’s just a waste of money.”