Monday, March 11, 2019
By NEIL HARTNELL
and NATARIO McKENZIE
Tribune Business Reporters
Royal Caribbean Cruise Lines (RCCL) is acquiring real estate at Paradise Island’s western end in a bid to develop what is thought to be a “getaway destination” for its passengers.
Multiple sources have confirmed to Tribune Business that the cruise line has quietly been acquiring or bidding on properties near the lighthouse that is a key Nassau harbour landmark, with some already under contract.
Government and Royal Caribbean principals were last week tight-lipped on the cruise line’s Paradise Island plans, but did not refute their existence or its likely development strategy.
Michael Bayley, Royal Caribbean International’s president and chief executive, did not comment specifically on the cruise line’s intentions when pressed by Tribune Business last week.
Speaking in general terms, he said: “We’re always looking around for opportunities. Anything we think we can do to help enhance the customer experience, and also the community, we’re interested in exploring. There is always something going on with Royal Caribbean.”
Dionisio D’Aguilar, minister of tourism and aviation, responded: “I have no comment on that” when asked about Royal Caribbean’s Paradise Island plans. He, too, did not deny them.
Tribune Business understands that the Government, while having no objection to Royal Caribbean acquiring Bahamian real estate, has some reservations about approving an exclusive ‘beach getaway/excursion’ type destination for a major cruise line so close to Prince George Wharf.
The concern is that Royal Caribbean would direct all its passengers to this location, thereby depriving downtown Nassau merchants, straw vendors, taxi drivers and hair braiders, together with local attraction, tour and excursion providers, of significant revenues and customer base.
This newspaper’s contacts, speaking on condition of anonymity, said nothing has been confirmed or approved yet in relation to Royal Caribbean’s Paradise Island designs. However, revelation of their existence comes just as the Government has unveiled Global Ports Holding as the preferred bidder to undertake a $250m transformation of Nassau’s cruise port.
This newspaper also understands that there are Bahamian-owned and generated proposals for developing a similar style destination experience at Paradise Island’s western end, centred on the lighthouse and beach, which may rival Royal Caribbean’s plans and are under consideration by the Government.
“Royal Caribbean is buying up the entire western end of Paradise Island, buying all the land,” one well-placed contact familiar with developments said. They suggested Royal Caribbean was seeking to develop a water-based park by combining the properties it is purchasing, although other sources said such a park was not in the offing.
This contact, though, said Royal Caribbean was likely to have been motivated by Atlantis’s success in attracting its passengers - and those of other cruise lines - to its facilities, and especially its water-based theme park, on day passes.
“Atlantis’s biggest business is the day visitors from the cruise ships,” the source said. “If Royal Caribbean is only getting 30-40 percent of what they pay, why not build their own water park so they make 100 percent of what Atlantis is making?”
It is unclear whether the cruise line will seek to lease the lighthouse and surrounding beach area, which sits on Crown Land and is thus owned by the Government. It is thought the Government would be reluctant to agree to this - especially to a non-Bahamian interest.]
One realtor, speaking on condition of anonymity, said he was aware of Royal Caribbean’s interest in, and activity on, western Paradise Island. “There is one piece that I know they’ve bought” he said.
“They have under contract the western end of the island. It’s definitely in the works. We don’t know what they’re actually proposing. We were assuming it was to take people over there.” Another contact pointed out that the western end of Paradise Island was zoned commercial, and that it had become a residential setting “by accident”.
Several properties on Paradise Island’s western end have been on the market in recent years. Hollywood actor Nicholas Cage’s property, Kilkee House, was put up for auction in 2016, while art dealer Gilbert Lloyd, whose father co-founded the Marlborough Gallery, was said to be seeking near-$16m when his property was advertised for sale in 2017.
Tribune Business was told that Royal Caribbean has been acquiring, and seeking to acquire, properties extending from the boundaries of the Government’s Crown Land up to the property owned by Sterling Financial Group chief, David Kosoy. There were also suggestions it was interested in land near the Yoga retreat and former Club Med.
Royal Caribbean’s last year said it will “bring closer” to 2m visitors to The Bahamas by 2020-2021, marking a two-thirds increase in just two to three years.
Mr Bayley said then that the cruise line was likely to exceed its own projections of bringing 1.75m passengers - a 45.8 percent increase - to The Bahamas within that timeframe. It therefore makes sense that it would seek new destinations and experiences in The Bahamas to match the increase in customer base.
The Royal Caribbean chief also pledged that it will grow its current estimated $300-$350m annual Bahamas economic impact, adding that it was mindful of the need to strike a “balance” between calls on Nassau and visits to its Coco Cay private island in the Berry Islands.
The latter property is currently undergoing a $240m upgrade and expansion, which will largely be completed by May 2019 and facilitate the hiring of a further 100-120 Bahamians to join the 250 already employed at Coco Cay by Royal Caribbean.