Taxpayers, through the government of The Bahamas, are reportedly bolstering repairs of Memories Resort & Spa at Freeport on Grand Bahama Island. Freeport’s largest resort property has been closed since suffering a devastating hit by Hurricane Matthew in October.
Tribune 242 said Monday that the government has confirmed a commitment of $2.5 million to speed up repairs there. Memories’ parent operator, SunWing Travel Group, are reportedly part of a consortium that includes Hard Rock International involved in a $110 million bid to purchase the luxury Grand Lucayan property from Frankfort-listed, Hong Kong conglomerate Hutchison Whampoa (FRA:HUWA).
Previous reports have indicated that Hutchison Whampoa has never turned a profit and have received multiple subsidies throughout the years in order to keep tourism flowing to the paradise island with a current unemployment level of nearly 20 percent, due in part to the aftermath of last year’s hurricane.
Hutchison has reportedly suffered losses from $10 million to $20 million each year since the Grand Lucayan property opened in 2001.
Also involved in the potential purchase, according to the newspaper, is the Wynn Group of Canada – not to be confused with Wynn Resorts of the U.S. and Macau.
Although not then confirming a dollar amount, Prime Minister Perry Christie has recently commented about the “millions of dollars” the government has committed to opening the resort by April. Some reports indicate that the government may bridge the gap between the amount Hutchison wants for the property, and the price a qualified buyer is willing to pay. Numbers as high as $20 million have been reported.
Hutchison Whampoa had earlier been criticized for the slow pace of repairs, but a company spokesman claimed that they were waiting on an insurance settlement for storm damage. That was reportedly confirmed to the news outlet by The Hon. Obediah H. Wilchcombe, Minister of Tourism for The Bahamas. “The insurance is taking a while longer than expected, so we’re trying to move things forward more quickly,” he told the Tribune Sunday.
Staff at Memories Resort confirmed yesterday that the property remains totally closed, while about 200 rooms have been opened at Grand Lucaya’s Lighthouse Point. The small casino, shared by the properties’ guests remains closed as well. Pelican Bay rooms were available as of last week near Port Lucaya, but the Breaker’s Cay hotel center also remains closed. In all, the Category 4 storm reduced the island’s hotel inventory by about 1,500 rooms.
The pace of repairs was concerning to some officials as they noted last week that some local staff had already decided to apply for work at Baha Mar, which is also expected to open in April and who began an employment drive last week. Fears of the island “depopulating” have been raised, as they were with the Royal Oasis closure in 2004 and in 2011 when 200 workers were laid off at Our Lucaya amid competition from West Palm Beach and other tourist areas in Florida, just 90 miles away.
The Tribune reported last week that SunWing was “Committed to operating in Grand Bahama, and continues to support the destination through our airlift and tour operator support,” as rumors were circulating about the company pulling out. Cruise ships are currently calling on the island and are responsible for a much-needed uptick in hotel bookings. After a 3-month hiatus, Bahamas Paradise Cruise Line’s Grand Celebration resumed regular service to the Island on January 14 carrying 1,300 passengers out of West Palm Beach.
Efforts to sell the Grand Lucayan had been underway since early 2016 and may have been in the final stages when the island was hit by a major storm last year. In answer to a Tribune reporter’s questions about the price and potential players in a new deal that would see a consortium of SunWing, Memories, Hard Rock, and the Wynn Group purchase the entire property, the Minister replied that it was under discussion, the names had not been confirmed, and that the price was “around” $110 million. “They’ve been trying to put a package together to present to Hutchison, and expect to get some return. It wouldn’t be a bad group to put together,” said Mr. Wilchcombe.