The government has agreed to grant Kerzner International a significant amount of concessions for the construction of the Atlantis Phase III resort which will lead to a total investment by the company of $1.7 billion.
Those concessions include an extension of the casino tax concessions that the company presently enjoys that includes extending certain concessions for a period of 11 years from the completion of the expansion.
The government has also agreed to an extension by 20 years of the moratorium on new casino licenses on Paradise Island and New Providence from the completion of the expansion; exemptions from certain import duties on construction materials; and continued co-operative marketing contributions.
As part of the Heads of Agreement, the company has also provided certain undertakings that include skills training, community development programmes, and to the extent possible, a local stock ownership programme for Bahamians.
Speaking at a press conference on Monday at the Cabinet Office along with Prime Minister Perry Christie, Kerzner International President Butch Kerzner said that the decision was not an easy one to make at this time because of the slowdown in the global economy.
“The travel industry is in disarray, many of the largest hotel companies are close to or on the verge of bankruptcy,” he pointed out.
The Heads of Agreement was signed yesterday and construction should begin by the end of this year and should be substantially completed by December 2006.
Mr. Kerzner also said that the company intends to open a fair amount of the project in 2005.
The new investment is expected to provide 2,000 additional permanent jobs for Bahamians and 1,500 construction jobs.
The third phase of the development will boast a new 1200 room hotel at Pirates Cove, three new luxury villas at the Ocean Club, 20,000 square feet of additional restaurant and retail facilities and an extension of the water-themed attractions.
It will also feature 120 new two-bedroom time-share units overlooking Nassau Harbour, 50,000 square feet of additional convention facilities and a fire and ambulance station.
Prime Minister Perry Christie said that the investment brings some important additional undertakings with it, such as the maximization of Bahamian staff, utilization of Bahamian materials, the expansion of training programmes, maximizing the use of Bahamian entertainers and musicians and the creation of the opportunity for Bahamians to invest up to 500,000 shares in Kerzner International.
Mr. Christie said that his government will undertake certain infrastructural improvements to accommodate the increased tourism arrivals foreseen by the addition of phase III.
“These [improvements] include the continued improvement of road networks in New Providence, substantial improvements to the Nassau International Airport and the provision of necessary water, electricity and telecommunication facilities to accommodate the considerable increase in demand that will attend the phase III expansion,” he said.
Mr. Christie also said that the government will continue to negotiate with the United States government for tax deductions for businesses holding conventions in The Bahamas.
“It [the investment] will generate massive economic benefits that will accrue to the Bahamian people. It will also stimulate the flow of foreign investment capital into The Bahamas,” Mr. Christie said.
A golf course is also proposed for Athol Island which Kerzner officials have assured will be made available for use by Bahamians at reasonable rates.
There will also be enhanced marine attractions that will be implemented with special consideration for the protection of the environment, officials said.
Mr. Kerzner said that his company is aware that it is easy to become complacent, but because new properties are being developed all the time in other destinations such as Orlando and Las Vegas Kerzner must be committed to keeping its product first class and exciting.
“It is incredibly important that we remain competitive and do things that are new, exciting and novel that will keep people in the United States talking about The Bahamas,” he said.
Mr. Kerzner said that the goal was a very ambitious one but, his company is excited to be in partnership with the government.
“Having spent the last nine or 10 years in the country, we have enormous confidence in the future of the country,” Mr. Kerzner said.
He also said he was confident that Kerzner International would “effectively create a project that is completely in a league of its own, anywhere in the world.”
By Julian Reid, The Bahama Journal