Thursday, November 26, 2015
By LAMECH JOHNSON
Tribune Staff Reporter
ljohnson@tribunemedia.net
NEW developments concerning the stalled Baha Mar resort prompted stakeholders yesterday to ask a Supreme Court judge for an adjournment of a winding-up petition until February 2016.
In what was to be a hearing into the government’s winding up petition against the incomplete Cable Beach resort, Crown lawyer Loren Klein asked Justice Ian Winder to adjourn the proceedings until the end of January due to new developments since the stalled property went into receivership.
Respective creditors and stakeholders in the project – the Export Import Bank of China, China Construction America (CCA) Bahamas and various government agencies part of the proceedings – had no objection to the adjournment which was granted until February 1, 2016. The EXIM bank is the resort’s lender.
However, in response to the latest adjournment of the proceedings, Baha Mar’s developer, BMD Holdings, issued a statement declaring that “Baha Mar was never meant to be about political and legal machinations nor about putting one party’s self-interests ahead of what is best for the project and the Bahamas.”
“The developer remains firm in the belief that it is in the best interests of the Bahamas for Baha Mar to be completed properly and opened as soon as possible,” the developer’s statement said.
“The developer has never viewed a winding up or liquidation of Baha Mar as an attractive outcome for the Bahamas. The developer remains committed to seeking a consensual resolution of the issues that have resulted in Baha Mar not being able to open, so many jobs being lost, and so many people and businesses suffering economic consequences,” the statement added.
The opening of the 2,000 plus room resort was scheduled for last December but was delayed to March of this year and again to May.
Baha Mar then filed for bankruptcy protection in the United States on June 29, however the Supreme Court rejected the resort’s application for the matter to be recognised here. A US judge later threw out the bankruptcy application for Baha Mar’s Bahamian companies.
Baha Mar’s developer is at odds with its general contractor, CCA Bahamas, which it has blamed for numerous opening delays. However, CCA has placed the blame for the resort’s woes on Baha Mar executives, citing mismanagement as the reason the property is behind schedule.
Since the bankruptcy rejection by the Bahamas Supreme Court and the end of Chapter 11 proceedings in Delaware, joint provisional liquidators (JPLs)were appointed in September to protect and prevent the depletion of the resort’s assets before an expected full winding-up of the resort took place.
However, the resort was placed into receivership in October.
Despite the resort’s woes, Prime Minister Perry Christie has repeatedly expressed optimism about the property, and has said a number of international investors are interested in Baha Mar.
Wayne Munroe, QC, who represents a number of government agencies that have filed petitions in the winding up matter, was asked by The Tribune yesterday if he knew the identities of the prospective buyers of the project.
“All I can say, because that would be within the breast of the receivers, it’s been said that there’s been a beauty parade of persons going and expressing interest,” Mr Munroe said.
“Some of it has met the press. I would’ve thought that with such a resort, there would clearly be interest and the (EXIM) Bank would clearly be interested in getting some resolution for its massive investment into the ground out there,” he added.
The adjournment of the winding-up petitions, he added, will “permit the receivers, together with the (joint provisional liquidators) to do their work to see if they can arrive at a solution as quickly as possible.”
“The receivers will be driving the issue of realising the security which is the resort, in terms of whether selling it or completing it, and the JPLs will stay in office to protect the interest of the unsecured creditors,” Mr Munroe said.
Comments
TruePeople says...
stop with the 'best interests of the Bahamas' non-sense... None of these organizations have 'the best interests of the Bahamas' in mind. They exist for the purpose of creating profit, particularly for their shareholders.
They never came here for OUR best interest. They came here because of Geography. We as a people are merely coincidental. They want the real estate, we just happened to be the ones on it. Then everyone turn round bout 'Bahamas best interest' I'm tired of hearing that PR hogwash.
This is why we all are upset with the Gov't. It is THEM who should be looking out. Instead they do some stage show theatrics bout they deporting Haitian, all the while murder gone up, investors get scared away, and almost every gov't office has large sums of money 'being misplaced'.....
CCA EXIM bank dem don't mind put it off further, cus they have time to bide. It's not their country that's being Uglified with these non-sense eyesore building where tourist should be enjoying a view of Nassau, but all ya see is bricks. It's not their economy that's being stalled either.
3.5Billion? if they had the best interest of Bahamians in mind they would have put that money into social programs and eductation, not in a greed driven "build it all one time" hotel-monster that keeled over and dead on Cable Beach.
Posted 26 November 2015, 2:24 p.m. Suggest removal
Emac says...
Yep
Posted 26 November 2015, 7:40 p.m. Suggest removal
Bahamian_in_London says...
This was sadly inevitable.
By kicking Sarkis out, China ExIm has control, but they have lost a management team and a potential funding source.
Now their only options are to sell it as is for 50% - 75% of their loan value, or take the high risk approach and fund the completion and manage it themselves, negotiating new management contracts with hotel operators in time.
These are both bad options for China ExIm and Bahamas.
They should have taken Sarkis' offer of $400m additional funding split down the middle with Bahamian contractors finishing off CCA's shoddy work. This offer should have been absolutely pushed by Christie, instead of the this ridiculous provisional liquidation farce we find ourselves in.
But of course ExIm would not go down that path because that would make CCA look bad. And Christie did not push it because he is bought by the Chinese.
A national tragedy, primarily caused by ego.
Posted 26 November 2015, 4:01 p.m. Suggest removal
Reality_Check says...
You're wrong. It's a national tragedy caused by insatiable greed and corruption that rises to the very top of our government!
Posted 26 November 2015, 6:09 p.m. Suggest removal
Tarzan says...
Now it begins.
The inevitable.
The resort to U.S. "work out" bankruptcy court would have guaranteed the property would have been open by now. That is what Chapter 11 Courts do. Preserve the asset.
That means all the Bahamian sub contractors would have been paid in full. That is the only way to get those necessary support sub contractors back to work to open the property.
That is what a Chapter 11 Court is there to do.
Why was it not used in this situation? What possible reason for this "liquidation" approach that simply guarantees the following:
1. None of the Bahamian sub contractors who were owed millions will ever be paid.
2. None of the employees who would have received full compensation in order for the property to open will ever recover lost wages.
3. None of the critical personnel who were waiting to start work, who have now left the country will ever be induced to return.
4. None of the hotel management companies, critical to the successful operation of the property, will ever agree to manage the property. They will take relief under clauses in their contracts with the developer, and walk away.
5. The property will become a bleeding hole in the heart of the Bahamas which will remain that for years, yes I mean years, as it deteriorates and the legal wrangling associated with "liquidation" goes on in courts all over the world.
6. The Bahamian economy will suffer for all that time.
There is only one answer. The leaders of this government and their minions could not face the inquiry and associated transparency of a U.S. court system. They have too much to hide.
There is no other explanation.
Posted 26 November 2015, 10:11 p.m. Suggest removal
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