By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

And NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The British Colonial Hilton was sold for a sum “in the ball park of $60 million”, Tribune Business was told, as its outgoing chairman described the deal as “a win-win for everyone”.

Gerhard Beukes told Tribune Business: “I’m very pleased with where we arrived at. I think this is a win-win for everyone from my point of view.

“I think obviously, when you talk to buyers, you are going to talk about price. That is just the reality of the world. The first question you generally ask is what do we do with the employees. As an employer you have to be responsible and acknowledge that you are effectively responsible for the livelihood of 270 people.

“You have to be a responsible employer and I think that we have been, and by overseeing this transition I think we have sort of realised that by saying everyone transfers over,” Mr Beukes added.

“The second thing is how will the involvement of the new owners affect this property and the surrounding areas. It is important that a buyer coming in continues to develop because if you are not striving to improve you are going backwards.”

Mr Beukes declined to discuss the price being paid by China State Construction Engineering Company, saying he was under a strict confidentiality agreement.

However, sources familiar with the deal suggested the sales price agreed with the British Colonial Hilton’s soon-to-be former owners was around the $60 million mark.

They added that China State’s original offer had come in around $50 million, and was then worked up to $55 million, then the “high $50 millions, $60 million” range via extensive negotiations.

Tribune Business, meanwhile, can reveal that there was a ‘deal beneath the deal’ among the ‘exiting’ owners. This, sources familiar with the transaction told this newspaper, involved Aubaine Capital buying out its fellow owner/partner, the Canadian Commercial Workers Industry Pension Plan (CCWIPP).

The price CCWIPP received is undisclosed, but one source said: “The deal was signed two-three weeks ago.

“They [Aubaine] bought out the interest of the Canadians. They felt it was easier to negotiate with the Chinese without the Canadians hanging around.”

China State now plans to develop the six-acre property adjacent to the British Colonial Hilton, on its western side, into a luxury hotel and condominium unit.

The project, which will begin next year, was, at Friday’s sales agreement signing, billed as creating 250 construction jobs and 500 permanent jobs for Bahamians. A further 500 jobs in the retail, marina village, marina and boardwalk, restaurant, gym movie theatre and nightclub components will be created.

However, Tribune Business sources suggested that China State’s existing construction workforce on the Baha Mar project would simply be redirected to the British Colonial Hilton, raising questions about the jobs/entrepreneurial opportunities for Bahamians.

“They’re going to move their workforce from Baha Mar down to the Hilton,” one source told this newspaper. “The Government had agreed to the Chinese keeping their workforce which, when Baha Mar gets completed, will get involved in other projects.”

There was some talk last week that the Mosko Group of Companies, the main Bahamian contractor on Baha Mar, would be used as a ‘third party developer’ or would get the marine construction work at the British Colonial Hilton, but that could not be confirmed before press time.

Meanwhile, Prime Minister Perry Christie confirmed a Tribune Business exclusive that China State had submitted to the Government a ‘masterplan’ for the wider redevelopment of downtown Nassau - from Arawak Cay to Potter’s Cay.

He said the British Colonial Hilton owner had expressed a willingness to join in a public private partnership (PPP) with the Government and Bay Street stakeholders for the overall redevelopment.

China State’s chairman, Jun Yi, said the firm’s planned investment in downtown Nassau should contribute $750 million to the country’s gross domestic product (GDP) over the next 20 years.

“This really begins a process that will embrace the entire harbour of this island, and will make this island and its harbour one of a kind in this hemisphere,” said Mr Christie.

“That is what is going to happen, and that’s what we believe and, most certainly for the families who own properties on the waterfront and who have their own plans in place for their development. They are waiting now for the Government and whatever other partners the Government will have to bring to the table this redevelopment of the harbour of Nassau to take place.”

It appears that Mr Christie and the Government have decided that it is only China State that has the capital and resources to complete a redevelopment of downtown Nassau that will run into the hundreds of millions of dollars.

Where that leaves the Bahamian landowners and other interests in downtown Nassau is open to question, for despite the PPP promises, it leaves open the possibility they may be ‘railroaded’ or ‘dragged’ into accepting the Chinese plan.

Both Charles Klonaris and Ed Fields, the Downtown Nassau Partnership’s co-chair and managing director respectively, and Brent Symonette, whose family is a major landowner in the area, previously told Tribune Business they have never seen the Chinese plans. Only Government has.

The scope of Bahamian involvement, participation and influence over downtown Nassau’s redevelopment thus remains up in the air.