The Tribune

• Hotelier: ‘We’ve done a good job messing up Freeport’

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A Freeport hotelier says it is “impossible to build a tourist destination” on Grand Bahama when airline ticket prices fluctuate between $3,000 and $150 within a timespan of barely several days.

Magnus Alnebeck, the Pelican Bay resort’s general manager, told Tribune Business that the island simply lacks the airlift capacity, infrastructure and hotel rooms to cope with “the peaks and valleys” created by the Grand Bahama Shipyard.

He confirmed that, on days when a ship’s crew is being flown out, all the outbound seats on the flight to Miami are taken, raising prices for a one-way ticket as high as $3,000. But, on days when there is no such business, the Pelican Bay chief said aircraft load factors drop as low as 10 percent with tickets falling to $150 for the same journey.

Asserting that such volatile swings make it virtually impossible to build sustainable airlift to Grand Bahama, Mr Alnebeck told this newspaper: “When they change crews it takes all the airline inventory on a particular day. For two days next week they are sold out.

“You have some days where a one-day ticket to Miami is $3,000, and you have some days when it is $150. You cannot try to build a tourist destination with these sorts of fluctuations. With those of us who live here, it’s fine. We take Western Air to Nassau and catch American Airlines from there.

“These are small jets that are coming in from Miami, and if you have a crew of 40 being changed over those seats are gone,” Mr Alnebeck continued. “Again the problem is if there is not a crew change in the Shipyard, those flights are going to be operating with 10 percent load factors. 

“We have businesses in Grand Bahama that are really good, like the Shipyard, but we don’t have the infrastructure - the airlift and the hotel rooms - to deal with their personnel and volumes. When I get calls from the shipping agent saying they need 150 rooms for two weeks, I have to say I can’t do it so they get a ship in for them to sleep on.”

Grand Bahama’s airlift limitations are a product of reduced room inventory in the aftermath of COVID-19 and Hurricane Dorian, coupled with the protracted wait for long-running efforts to sell the Grand Lucayan to bear fruit, with the lack of demand prompting airlines to reduce capacity to the island to the bare minimum.

“We’ve done a great job messing Freeport up,” Mr Alnebeck told Tribune Business. “Some people contact me and say I should talk about great news, but I will believe it when I see it.” Referring to the Port Lucaya Marina’s impending sale, he questioned how $200m could be invested in the former Ginn project in West End when no golf course or marina had opened, or vertical construction take place.

Speaking earlier at a Bahamas Hotel and Tourism Association (BHTA) Board of Directors meeting, the Pelican Bay chief had suggested that Kerry Fountain, the Bahamas Out Island Promotion Board’s head, “needs to exclude Grand Bahama” when giving an upbeat assessment of the performance by small hotels in the northern Bahamas.

“We are slowly but surely digging ourselves out of the hole created by Dorian and, after that, COVID,” Mr Alnebeck told that meeting. “There are some small developments about to happen, some marinas to be sold and people sniffing around to pick up stuff on the cheap. We hope that happens.’

He urged the US embassy and US Customs and Border Protection to clarify whether Freeport’s pre-clearance facility had been withdrawn permanently, and if there were any actions that The Bahamas can take to ensure this decision is reversed.

“We’ve given them the justification to withdraw that, and we should immediately redevelop Grand Bahama International Airport to the minimum specifications for getting that pre-clearance facility back,” Mr Alnebeck told Tribune Business, acknowledging that The Bahamas had done little in the two-and-a-half years since Dorian to encourage the US to make an alternative decision.

“We were a bit saddened by the announcement of the US embassy and the US government when they said they would start the process of removing pre-clearance from Grand Bahama. That would be a big setback for the future but, at the same time, we have to understand it.”

Pointing out that airlift to Grand Bahama was “very limited”, with Bahamasair and Spirit having restricted schedules, Mr Alnebeck drew some encouragement from reports that American Airlines will increase the frequency of daily flights from Miami from one to two per day with effect from March 2.

Describing airlift to Grand Bahama as being “more and more” like that to a Family Island, he added that Pelican Bay was presently running at about 30 percent occupancy. “We are not really seeing any leisure business at all in Grand Bahama,” Mr Alnebeck said.

“We are seeing some snow birds coming back, and that creates some activity in the restaurants, but the leisure tourist is virtually non-existent. The only hotel in Grand Bahama trying to focus on leisure business is Viva Fortuna.”

Marco Gobbi, general manager of the Viva Wyndham Fortuna Beach resort, told the same BHTA meeting that the property “hasn’t seen any sign of a ramp-up in our market” while pointing out that airlift costs from Miami are “incredibly high”.

He added that Viva Fortuna was presently at 20 percent occupancy, and described the previous 10-15 percent average as “a disaster” that had left the property challenged to maintain its operations.