Employees who have opted to accept voluntary separation packages (VSEPs) at the Grand Lucayan resort in Freeport, Grand Bahama, could receive those separation offers before Christmas, Minister of Labour Dion Foulkes said yesterday.
He said the resort’s board wants to complete that process as soon as possible.
“We are hopeful that both unions and the new board at Our Lucaya… would be able to come to a settlement so that those persons who want to leave the hotel — managers who want to leave, can leave and leave with their severance package. Those in the line staff union; those persons can also leave, and leave with their severance packages. We want to get this done before Christmas so those persons who are leaving will have their checks.”
In October, Michael Scott, the chairman of the government’s special purpose vehicle (SPV), estimated it will cost the government over $3 million to finance the VSEP offers.
The SPV, Lucayan Renewal Holdings, was set up to hold the assets and manage the process of the resale.
Around 150 employees have opted to accept packages — 60 managers and around 90 line-staff employees.
Scott told The Tribune earlier this month that the unions representing employees at the resort requested payouts that exceeded the resort’s offer by $4.6 million.
He said the Bahamas Hotel Managerial Association, which represents middle management, demanded $5.4 million in payouts for its members.
He said this doubled the $2.7 million offered by the resort’s board.
As it relates to the Commonwealth Union of Hotel Services and Allied Workers Union, which represents line staff, Scott said it requested over $3 million — nearly triple the resort’s $1.1 million offer.
The government purchased the resort for $65 million, with $30 million paid up front.
It borrowed the balance from the former owners, which will be a government-guaranteed mortgage paid over three and a half years.
As part of the purchase agreement, the government paid Hutchinson Lucaya Limited (HLL) and Bahama Reef Limited $1.5 million as a subsidy for operational losses while keeping the Lighthouse Pointe open during the completion of the purchase.
Breaker’s Cay and Memories remain closed.
It would cost the government around $39 million to renovate the resort’s properties – Lighthouse Pointe, Memories and Breaker’s Cay – according to Deputy Prime Minister Peter Turnquest.
Last Friday, the government revealed it will invest another $3.5 million in renovating the resort to maximize the property’s earning potential as tourists flock to The Bahamas for the holidays.
This week, Minister of Tourism Dionisio D’Aguilar said the government expects the resort to be sold by the second quarter of next year.
Scott had originally projected it would take six months to resell the resort following the September purchase.
The sale was expected on September 11.
According to officials, there has been two dozen written expressions of interest from potential buyers.
Yesterday, Foulkes dismissed suggestions from the opposition that the government’s projected resale timeframe is misleading.
He said there are “serious contenders”, including entities involved in the hotel industry and airline industry which have sent “serious proposals to the government”.
The government has said it purchased the resort to protect the economy of Grand Bahama and the national interest of Bahamians.