Sep 24, 2015 News
…final price tag remains a mystery, Casino stalled
Marriott Hotel is reportedly in danger of defaulting on a payment to Republic Bank.
The newly installed Chairman of the Board of Directors, Beverly Harper, however insists that Marriott is in no danger of defaulting on any of its payments, and that the hotel is in fact currently turning a profit. Whatever payments are owed will be made.
Beverly Harper, the Ansa Mcal Chief Executive Officer (CEO) was appointed Chairman of the Board of Directors at Atlantic Hotel Inc. (AHI), the Special Purpose Company established to own the Marriott Hotel in Kingston, Georgetown.
The new board was installed earlier this month with its other directors. They included Laurie London, Derrick Cummings and Patricia Bacchus. AHI was previously headed by Winston Brassington and Marcia Nadir-Sharma.
This publication spoke with Harper briefly yesterday and queried the state of affairs at the company, and she insists that while tabulations are still being made, the hotel is in fact making a profit, and will be able to make its payments to Republic Bank.
A well-placed insider told this publication, however, that the Marriott Hotel, some six months after its opening earlier this year, is currently unable to make any repayments—principal and interest—on the US$15.3M that was secured from that bank as part of a syndicated loan. The property is mortgaged to Republic Bank as a result of the transaction.
AHI had initially approached the bank to secure a consortium of investors to the tune of US$27M but this was cut short as a result of court action filed by then opposition Member of Parliament, Desmond Trotman. That court action resulted in only US$15.3M being transferred from Republic Bank to Atlantic Hotel Inc (AHI) for the multi-million dollar hotel.
That banking institution currently has a lien on the property and almost seven acres of land. Scheduled to operate at a loss for a number of years before reaping a profit, as well as taking on additional loans following its opening, Harper told this publication yesterday that mere months after opening its doors, the Marriott Hotel is in fact making a profit. She was however unable to provide any details in relation to what level of profits is being made.
She was also unable to provide any details in relation to the final cost for the construction of the Marriott Hotel, since works have been stalled on the Casino and Entertainment Complex of the facility.
The final cost will have to also include interest accrued during construction of the hotel in addition to the millions spent for the preparation of the site, including the destruction of the Luckhoo Pool and the sinking of a Well facility to supply the hotel with water.
The Casino and Entertainment Complex of the facility was proposed at an additional US$16M. According to Harper, since the installation of the new board earlier this month there has only been one meeting and no decisions have been made on the Casino and Entertainment Complex which is currently at a standstill.
The Marriott Hotel was proposed to be constructed at a cost of some US$58M. Of that amount US$8M was supposed to have come from private investors while, a US$27M syndicated loan was sought from Republic Bank and the National Industrial and Commercial Investment Limited (NICIL) putting in an additional US$19.4M.
This did not materialize and Brassington at the time had blamed, among other things, the court action which stalled the release of money from Republic Bank. NICIL ended up putting in some USS$35M into the project, the majority of which comes as an interest free loan with a 15 year hiatus on repayments.
AHI is also currently the subject of a forensic audit ordered by Government and this publication understands that this process could be completed within two weeks time. Kaieteur News was told that a preliminary list of queries was submitted to Executive Director of the AHI, Brassington at the end of last month and he has since submitted a detailed response which is being assessed by the State Auditors.
This publication understands that following an analysis of the responses proffered by Brassington, subsequent queries could be made after which time a final report would be submitted to Finance Minister Winston Jordan.
When ayuh will wake up?
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