Prime Minister Perry Christie, who outlined extensive plans for a $1.8 billion resort development on Mayaguana at the Cabinet Office on Tuesday, announced that the Hotel Corporation of The Bahamas expects to offer a portion of its shares in the project to the Bahamian people.
The prime minister revealed that the development will be a joint venture between the Boston-based I-Group and the Corporation, who will split the profits 50/50, although the government will not have to come up with any capital for the project.
The government is making nearly 10,000 acres of Crown Land available for the development.
Mr. Christie also said that the development company – which will be a partnership between the investors and the government – will pay the Hotel Corporation 10 percent of the gross sales price for the sale of all lots in the development area and five percent of the gross sales proceeds received for the sale of all commercial lots in the development area.
He said provision is also being made for the Hotel Corporation to execute the right of first refusal in the event the I-Group entertains an offer for the sale of its shares.
I-Group will provide the entire capital to bring about the completion of the initial phase, the prime minister also said during the heads of agreement signing ceremony.
He said the developers will spearhead the financing related to other project phases and projects will be financed to the greatest extent possible by third party financing, and approved by the Hotel Corporation.
The Corporation and the I-Group will be issued 1,000 shares each in the Mayaguana Island Developers Limited (MID, the new joint venture company) and no further shares will be issued without the approval of both shareholders.
Mr. Christie stressed that the Corporation will not be required to contribute any additional capital to MID nor fund any losses of the company. The Corporation has also agreed to assist in attracting a hotel operator and a cruise ship operator and to assist the marketing efforts of MID.
“Recognizing the considerable benefits that will accrue from the development to The Bahamas, the government has agreed to grant to the Mayaguana Island Developers Limited and its licensees in respect of the development the concessions and exemptions for a period of 20 years,” the prime minister said.
But he added that the government has the right to reduce the concessions and exemptions granted to Mayaguana Island Developers Limited in certain circumstances of non-completion of the development obligations.
“With this agreement, Mayaguana joins all the other islands of The Bahamas that are helping to write a new history of economic progress and prosperity for our country,” Mr. Christie said.
“It is indeed a proud and happy moment for all The Bahamas for we all share in the great promise this wonderful new development holds in store for an island that finally, after all these centuries, is coming into its own.”
The first phase of the development will include the rebuilding and upgrading of the current airport with a runway to a minimum length of 7,000 square feet, improved terminal facilities, and security features which meet international standards. The airport, Mr. Christie said, will be capable of accommodating international commercial traffic.
The first phase will also include the creation of a 25-unit upscale boutique resort at North Beach, including luxury hotel accommodations, eco-sensitive resort amenities, a 100-lot residential community, utility services and roadways.
This component of the development will also include hiking trails, a sauna and spa, a small clinic, a golf putting green and driving range.
Mr. Christie said it is proposed with the approval of the environmental authorities and the relevant government agencies to revitalize a dormant eco-system in the Flamingo Pond vicinity.
Additionally, the prime minister said the developers have committed to attracting a well-recognized hotel operator to develop and operate a 225-room hotel resort on Mayaguana.
By: Candia Dames, The Bahama Journal
