Former State Minister for Finance Michael Halkitis says government’s intent to purchase the Grand Lucayan hotel property in Grand Bahama runs the risk of it being “stuck” with the resort.
Last week while touring the dormant property, Prime Minister Dr. Hubert Minnis insisted that government’s investment will only be temporary and once a buyer is secured government will willingly sell.
Halkitis, however, is of the view that this is a bad move for any government to make.
“To try to even consider that someone would walk along and give the government $65 million for that hotel is unthinkable,” he said.
“If that was the case, then we would have had investors already coming in and buying it directly from Hutchinson Whampoa.”
Halkitis served under the former Christie administration which brokered a deal between the Wynn Group and Hutchinson Whampoa to purchase the hotel before losing the 2017 general election.
The Minnis led administration, however, determined that the deal left on the table was not in the best interest of the Bahamian people and subsequently terminated it.
Wynn Group CEO, Paul Wynn reportedly recommended that the government purchase the hotel, and offered to loan government the money if it wanted to pursue the purchase.
Prime Minister Dr. Hubert Minnis announced last week that government had made a $10 million deposit on the $65 million property. It is unclear how that deposit was financed. When pressed by media, Minnis would only say that all details surrounding government’s purchase would be presented in Parliament after the summer recess.
When asked about the deal the Progressive Liberal Party (PLP) left in place, Halkitis said that it is often difficult to negotiate with investors as no other hotel investor is able to get a better deal than the Atlantis Resort. Government he added is often left with its hands tied.
He suggested that Government interest in the Grand Lucayan is risky.
“You have a government who wants to own and then try to flip it. The danger of being stuck with it is too great; I see a real risk of the government getting low rates and then has to hang its head.
“You can’t come back to the people and say we are selling it for $40 million when you pay $65 million.”
Minister of Tourism Dioniso D’Agular has admitted the probability that the government will come in at a loss with the sale of the hotel.
Minnis has also said that despite the loss to the economy, Grand Bahama has to be rescued.
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