The Tribune

BY NEIL HARTNELL

TRIBUNE Business Editor

nhartnell@tribunemedia.net

THE PORT Lucaya Marina’s purchaser yesterday argued that the “immediate danger” posed by the property’s “life-threatening conditions” must take priority over the administrative procedures it says regulators are citing for imposing a ‘stop work’ order on its demolition.

Bahama Land Waterways, which is owned by Port Lucaya Marketplace proprietor, Peter Hunt, and his business partner, Shmuel Herschkowitz, in a formal notice sent to the Grand Bahama Port Authority’s (GBPA) co-chairs, Rupert Hayward and Sarah St George, demanded that the ‘stop work’ order be removed with “immediate” effect and signalled that legal action is likely unless the impasse is swiftly resolved.

And, warning of the economic fall-out, they wrote that Port Lucaya Marketplace will be unable to “sustain its long-term operations” without a revived Port Lucaya Marina to drive visitor traffic and access. The Marketplace, Bahama Land Waterways added, has seen its occupancy decline to about 50 percent while “rental rates have not been increased for more than 12 years”.

However, the GBPA and its Grand Bahama Development Company (DevCO) affiliate, the latter of whom is the Port Lucaya Marina landlord, yesterday denied that they are unnecessarily or unduly blocking, or interfering with, the latter’s renovation and redevelopment (see other articles on Page 1B and Page 3B).

Their position is that they are simply enforcing long-standing permitting and approval requirements designed to protect public safety and ensure legal compliance. While Bahama Land Waterways had approached the GBPA for the necessary permits months ago, DevCO - as landlord - has to give written authorisation for the works to proceed and this has not been forthcoming.

And DevCO’s stance is that Bahama Land Waterways and its principals have yet to provide it with the necessary documents and paperwork to show they are now the actual owners and authorised representatives able to speak for Port Lucaya Marina Company, which holds the 99-lease on the property.

Tribune Business last year that Mr Hunt and Mr Herschkowitz were “pursuing plans” to acquire the New Hope Holdings assets for almost $22m - including the Port Lucaya Marina and Grand Bahama Yacht Club - currently held by Preben Olsen, the Gonzalez family and Duane Crithfield.

“Bahama Land Waterways is pursuing plans to redevelop the Port Lucaya Marketplace and acquire several key properties on Grand Bahama, including the Port Lucaya Marina, the Grand Bahama Yacht Club and surrounding waterfront buildings and properties,” the Central Bank disclosed. “The proposed initiative is valued at approximately $21.8m. The multi-phase development would feature a resort hotel, marina residential units and entertainment facilities.”

Bahama Land Waterways, in yesterday’s notice to the GBPA, argued that the acquisition is now completed and completion of the necessary bureaucratic and administrative formalities should not delay its plans to address “the severely deteriorated and life-threatening condition of the former wooden docks, associated structures, utilities and adjoining concrete areas at Port Lucaya Marina” because of “the immediate need to protect life and public safety”.

“Bahama Land Waterways has completed the acquisition transaction relating to Port Lucaya Marina Company,” the company wrote. “The commercial transaction is closed, the agreed purchase consideration has been paid, the former three partners/shareholders have exited the transaction, and they no longer control or direct the affairs of Port Lucaya Marina Company.

“The remaining steps concern only governmental, regulatory and administrative procedures required to register or record the transfer of the shares into the names of the acquiring parties. Those pending formalities do not mean that the transaction remains conditional or that the former shareholders continue to exercise operational authority.

“Bahama Land Waterways and its authorised representatives hold a full power of attorney to act for and on behalf of Port Lucaya Marina Company, and to make decisions concerning its property, operations, safety, contractors, demolition activities and all related matters,” the noticce to the GBPA added. “Port Lucaya Marina Company remains the corporate holder of the relevant marina rights and seabed lease while the procedural registration of the share transfer is completed.

“Accordingly, the explanation that the demolition must stop because the administrative registration of the completed share transfer remains pending does not reflect the actual legal and operational position. Port Lucaya Marina Company remains the same corporate tenant under the recorded lease; the acquisition has closed and been paid; the former shareholders have relinquished control; and Bahama Land Waterways and its representatives possess full authority to act for the company, including in relation to emergency safety work and demolition.”

Bahama Land Waterways argued that, while the transaction changed the ownership of the lease holder, Port Lucaya Marina Company still holds the tenancy and this has not changed. However, a further complication remains the legal action initiated by the GBPA and DevCo against Port Lucaya Marina’s former owners over their failure to live up to lease terms that they “maintain, repair and operate the marina”.

“The new ownership has now undertaken the very remediation that addresses those historical conditions: securing the site, demolishing the collapsed structures and rebuilding a safe and operational marina,” Bahama Land Waterways said. “The existence of pending litigation does not justify allowing an immediate danger to remain indefinitely….

“For approximately 14 years, following a much longer period of deterioration, the former wooden marina docks and supporting infrastructure have progressively decayed. Their present condition is not cosmetic and is not an ordinary maintenance issue. It constitutes a serious and immediate threat to human life and safety.

“Port Lucaya Marketplace has already installed fencing in certain areas in an effort to restrict access. The scale of the hazard, however, requires comprehensive isolation of the entire dangerous marina perimeter until demolition is completed,” Bahama Land Waterways continued.

“Port Lucaya Marketplace remains one of Grand Bahama’s principal active commercial and tourism destinations. Hundreds of residents, employees, visitors and tourists attend the Marketplace and surrounding waterfront area on ordinary days, with attendance rising to thousands during busy weekends, holidays and public events.

“The marina is immediately adjacent to this heavily-visited public area. This substantial and recurring pedestrian activity materially increases the likelihood that children, visitors or other members of the public may approach or enter the unsafe marina structures, and therefore materially increases the urgency of either completing the demolition without interruption or fully isolating and securing the entire hazardous area.”

As to the economic consequences of ordering Executive Marine Management’s demolitioin work to halt, Bahama Land Waterways warned: “The issuing parties further record that the timely reconstruction of Port Lucaya Marina is a matter of substantial public and economic importance to Grand Bahama.

“A functioning modern marina is expected to restore significant visiting-vessel activity, and support employment and commercial activity throughout Port Lucaya, including Marketplace tenants, restaurants, entertainment venues, the Straw Market, marine contractors, fuel and transport providers and other local suppliers.

“Any continued suspension of the demolition and reconstruction of Port Lucaya Marina will have serious and far-reaching consequences for the future viability of Port Lucaya Marketplace. Following two major hurricanes, hotels closures and the COVID-19 period, the owners of Port Lucaya Marketplace continued to maintain the property in a clean, attractive and fully operational condition,” Bahama Land Waterways added.

“The Marketplace was among the fastest commercial properties in Grand Bahama to reopen after the hurricanes, and remained operational throughout the COVID-19 period. Despite these efforts, occupancy declined at approximately 50 percent, while rental rates have not been increased for more than 12 years.

“In the present economic circumstances, Port Lucaya Marketplace cannot be expected to sustain its long-term operations without the restoration of the marina, which is of substantial importance to increasing visitor traffic, strengthening existing tenants, attracting new businesses and restoring commercial activity throughout Port Lucaya.

“The strategic importance of Port Lucaya Marketplace and the marina has also been discussed with the principals and management of MSC (Mediterranean Shipping Company) and CTL Maritime [its subsidiary] during recent meetings with the owners of Port Lucaya Marketplace concerning the planned development of the beach club and the broader revitalisation of the area.” That latter statement refers to MSC’s redevelopment of the former Breaker’s Cay property at the Grand Lucayan.

Mr Hunt did not respond to Tribune Business messages seeking comment before press time last night.