The 20-acre Club Med property, which includes a 306-room hotel and two restaurants, is adjacent to the site of a 1,200 room hotel that will be built as part of the recently announced $600 million Phase III expansion of the Atlantis Resort.
Butch Kerzner, president of Kerzner International, described the acquisition as “a great investment opportunity for us as we look to the future and our long-term growth plans for the Paradise Island properties, which ultimately contemplate 4,000 to 5,000 rooms around the Atlantis Resort.”
Club Med is the only remaining intact developable site of its size on Paradise Island, and includes extensive frontage on the famed Paradise beach. It was developed in the late 1970s by combining a number of upscale private residences on the island together with the old Porcupine Club, a onetime hangout for reclusive millionaires.
Mr Kerzner said the acquisition represented a “significant first step” towards a potential fourth phase of Atlantis development. The Paradise Island resort will soon rival Disney operations in scale.
And there are reports that Atlantis is planning a “jungle theme park” for the Club Med property eventually. But beginning next year, the existing hotel will be used to house construction workers who will build the 1,200-room hotel at Pirates Cove, site of the old Holiday inn that was demolished in the mid 1990s.
There are also reports that the government may have some concerns about the sale because it cuts the number of rooms on New Providence and shrinks Club Med’s commitment to the country less than a year after it re-opened the San Salvador resort. The government offered Club Med concessions to re-open in San Salvador.
Club Med launched the Paradise Island resort in 1977, and developed another on the old French Leave property at Governor’s Harbour, Eleuthera some years later. The 282-room San Salvador resort originally opened in 1992 but closed in 2001 after the Sept. 11 terror attacks.
Club Med is also reported to be in the process of selling the 40-acre Eleuthera property, which closed in 1999 following damage by Hurricane Floyd. An agreement was signed two months ago and the foreign purchaser is conducting due diligence before completing the deal.
The purchaser is said to be a “strong hotel brand” which will bring a lot of value to Eleuthera’s stagnant tourist industry. The Club Med property is virtually derelict and the size of the investment will reflect that if the deal goes through, sources said.
Minister of Financial Services & investment Allyson Maynard-Gibson would not comment on the transactions because she previously represented Club Med in private practice.
As part of the Paradise Island purchase, Club Med’s employees will be able to transfer to the Atlantis Resort once Kerzner International takes possession of the property. That is expected to happen late next year. In the meantime, Club Med will continue to operate the property.
According to a statement from Kerzner International, “Club Med employees who choose to transfer can expect a reasonably similar position to the one they had held, while maintaining their continuity and tenure of employment.”
A joint transition committee has been established with Club Med to manage the process. The sale of the property is subject to closing conditions, including relevant governmental approvals.
Club Med operates more than 100 holiday villages in 40 countries around the world. The Atlantis Resort now has 2317 rooms built around a seven-acre lagoon that includes the world’s largest open-air marine habitat.
By Larry Smith, The Nassau Guardian
