Latest update May 28th, 2023 12:59 AM
Mar 31, 2023 News
…money will be used to pay-out secret private investors
By Renay Sambach
Kaieteur News – Vice President (VP) Bharrat Jagdeo, on Thursday said that while the Guyana Marriot Hotel is “a profitable venture” and is “making a profit” it is of no supreme benefit to the Government owning it anymore.
Last December, it was announced that the Government is looking to sell the almost US$60M hotel. The hotel started under the Jagdeo administration when he was President using taxpayers’ dollars and with a syndicated loan through the Republic Bank Limited of Trinidad.
The Marriott Hotel was opened in 2015 and is currently owned by the Government through the National Industrial and Commercial Investments Limited (NICIL). The State agency had issued a prequalification notice seeking Expressions of Interest (EOIs) from persons or companies, individually or as part of a joint venture / consortium, with an interest in purchasing its shares in Atlantic Hotel Inc. (AHI), a special purpose company owned by NICIL for the acquisition of the Guyana Marriott Hotel.
On Wednesday, Chief Executive Officer (CEO) of NICIL, Radha Krishna Sharma, confirmed to this publication that eight firms have submitted their EOIs. According to the CEO, five of the eight applicants have paid for and uplifted information packages. Sharma noted too that the deadline for submissions of bids is on April 17, 2023.
For his part, the Vice President explained during his press conference that despite the hotel was started at a time when others touted it as “a white elephant” the hotel is now a money-making machine.
Jagdeo stated that as a result of the Government being generous to help trigger a new wave of hotel building, “…there is no particular supreme benefit to Government owning (the hotel), it’s better to maximise the money and invest it in something else backing healthcare or maybe in another facility…”
The VP justified the Government’s reason for selling the hotel now by saying, “The Government didn’t need to own a hotel at that time, but the era was that we were not getting new hotels built and we had to trigger the investment. So now it would be best to sell the Marriott off, you would probably maximise the price that you will get when it’s profitable and before the seven new hotels that are privately built, that are internationals brands come on the market. It is the period you maximize, the period in which you sell.”
The Government has been reported in the media encouraging investors to build hotels as part of their plan to advance the hospitality sector in Guyana. There are seven new hotels being constructed. The new hotels are expected to meet a demand of around 2,000 rooms by 2025. They are: the Hyatt Place Hotel with around 125 rooms at the Providence on the East Bank of Demerara (EBD), the 172 room Four Point Sheraton at Houston, EBD; the 13-storey Pasha Global Hotel at Liliendaal, East Coast Demerara (ECD), the 150-room AC Hotels Marriott in the vicinity of Ogle ECD, the Marriot Courtyard Hotel at Timehri EBD, Best Western to be located at Liliendaal ECD with 120 rooms and the 150 Sheraton Hotel entertainment giants, Hits and Jams, would be building with a foreign partner.
Kaieteur News had highlighted that under the syndicated loan agreement, the preferred rights goes to those investors – meaning that in the event of the hotel being unable to service the loan – the unknown investors would have the first lien on the proceeds of any sale.
Back in 2017, AHI was unable to meet its due financial obligations to repay the syndicated loan. As such, AHI had requested the assistance of NICIL, the guarantor but the State agency was also unable to assist. In order to prevent the hotel from being acquired by the bank, the former Government in April 2017 made the decision to transfer AHI’s financial obligations to the Central Government. This decision has resulted in US$1.1 million ($226 million) of taxpayers’ dollars coming out every six months (since 2017) to service the US$27 million loan – for a 13-year period.
However, during his press conference the Vice President stated that while in opposition the People’s Progressive Party Civic (PPPC) were opposed to the loan obligation being transferred to central government. Jagdeo claimed that the loan being burdened on taxpayers had nothing to do with the hotel being unable to service its loan.
According to the Vice President, the proceeds from the sale of the hotel will be used, “to clear off the remaining loan and some of it will come back to the treasury to be used back for whatever purpose is determined.” Jagdeo continued by stating that, “this is probably the best time when you can maximise the value before you get competition from the seven other hotels coming into the market within a year or two…”
No contracts cast in stone, except Norton and Jagdeo own!
May 28, 2023Kaieteur Sports – Two left-arm spinners Kevin Umroa and Dennis Legay spun webs around batsmen last Sunday at Centennial Park in another round of this year’s Canadian Commonwealth Cricket...
May 28, 2023
May 28, 2023
May 28, 2023
May 28, 2023
May 28, 2023
Kaieteur News – The PNCR has a new savior. And it is from an unexpected quarter: the PPPC. The PNCR is getting a little... more
By Sir Ronald Sanders Kaieteur News – The report on May 17, from the World Meteorological Organization, (WMO) that... more
Freedom of speech is our core value at Kaieteur News. If the letter/e-mail you sent was not published, and you believe that its contents were not libellous, let us know, please contact us by phone or email.
Feel free to send us your comments and/or criticisms.
Contact: 624-6456; 225-8452; 225-8458; 225-8463; 225-8465; 225-8473 or 225-8491.
Or by Email: [email protected] / [email protected]