By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Royal Caribbean and one of its affiliates have obtained government approval to acquire Freeport’s long-closed Xanadu Beach Hotel and surrounding land as part of a $348m investment, it was revealed yesterday.

The Central Bank of The Bahamas, in its presentation on 2025 first quarter economic developments, disclosed that the cruise line and its high-end Celebrity Cruises affiliate have received the Davis administration’s permission to proceed with the acquisition of a total 40-acre site that they intend to transform into “recreational and entertainment facilities”.

“Royal Caribbean Cruise Lines - Celebrity Cruises Incorporated obtained approval for the acquisition of 40 acres of privately-owned land for the development of recreational and entertainment facilities. The investment is valued at $348m,” the Central Bank confirmed.

While it made no mention of the Xanadu or the precise location, multiple sources familiar with developments told Tribune Business that the Central Bank was indeed referring to Royal Caribbean and Celebrity Cruises’ pending acquisition of the Grand Bahama resort property, its accompanying land and other real estate parcels in the immediate vicinity that they plan to combine into a shore destination for the latter’s passengers.

One contact, speaking on condition of anonymity because they were not authorised to speak publicly, yesterday said the Xanadu deal has been agreed and all parties are “signed up” with the closing due to take place in either late summer or early fall - possibly September. “They’re going to do a big thing,” they said of Royal Caribbean and Celebrity. “It’s all coming together.”

However, the confirmation of government approval for the Royal Caribbean/Celebrity Cruises transaction was tinged with tragedy as it was yesterday confirmed that Mario Donato, the Italian/Bahamian businessman who was the Xanadu’s long-time owner, has just passed away.

Prime Minister Philip Davis KC and his wife, Ann, in a personal tribute to the deceased businessman, voiced their “profound sadness” at his passing. They said: “Mario was one of those rare souls whose presence lit up every room and whose heart seemed large enough to embrace an entire nation.

“A man of incredible spirit and kindness, he came to The Bahamas in the early 1960s, disembarking in Freeport as a young waiter and found not just a new home, but a place to build dreams, friendships and a lasting legacy.

“From the beginning, Mario embraced our people, our cause and our spirit. He built businesses that became institutions in Grand Bahama restaurants, hotels, real estate ventures, but his true legacy is written in the countless lives he touched through his generosity, his loyalty and his boundless good humour,” the Prime Minister and his wife continued.

“His relationship with Sir Lynden Pindling, and his adoption of the progressive cause, mirrored the way he lived his life: Standing for fairness, opportunity and the building of community. Mario became a part of our family, our story and our heart. We mourn his loss alongside his beloved children, to whom we extend our deepest condolences. We thank them for sharing their father with all of us.

“His wife, who predeceased him, now surely welcomes him into eternal rest. Tonight, we say farewell to a giant of Grand Bahama; a true friend, a patriot in spirit and deed, and a man whose love for The Bahamas knew no bounds. May he rest in peace. May his memory forever be a blessing.”

Should the Royal Caribbean/Celebrity Cruises transaction close, and the development proceed, Grand Bahama and Freeport could potentially become host to not just one but up to three private cruise ports and destinations.

Besides Carnival’s $600m Celebration Key, which is due to open this summer, the island could also ultimately play host to both the Royal Caribbean/Celebrity Cruises project as well as the plans by Royal Caribbean, Freeport Harbour Company and Mediterranean Shipping Company (MSC) to develop Billy Cay into a new cruise port and amusement park.

Another contact, speaking on condition of anonymity, suggested a September closing for the Xanadu’s purchase was not a bad estimate for the completion timeline. “I don’t think there are major obstacles to overcome with the closing process,” they said. “It will be a great move for Grand Bahama. Hopefully the closing will happen.”

The source suggested that, given the involvement of multiple landowners in the deal, Royal Caribbean/Celebrity Cruises are seeking to close their separate deals with all at exactly the same time rather than via a piecemeal approach. The latter, where they would close with some or one, but not all, would hand the power to those vendors who have yet to complete. They could then exploit this to increase their price.

For, besides the Xanadu hotel property, Royal Caribbean and Celebrity Cruises’ ambitions extend to “all the tracts of land down to Princess Isle” that are presently controlled by Irish-headquartered Harcourt Developments, the Royal Oasis owner. These are the land parcels that the cruise lines are seeking to also purchase and combine with the Xanadu site to form the 40-acre property.

“If you look at the map you will see Xanadu at one end and four more ten-acre pieces going down to the west to Princess Isle. Harcourt Developments owns the next two,” one source told this newspaper in late 2023, when it first revealed the potential Royal Caribbean deal. Tribune Business was subsequently informed that Harcourt controls all the property between Xanadu and Princess Isle.

Built in 1968 by US shipping tycoon, D. K. Ludwig, the Xanadu established itself as a venue for the so-called “Rat Pack” - the likes of Frank Sinatra, Sammy Davis Jnr, Cary Grant and Dean Martin - as well as accommodating reclusive billionaire Howard Hughes, who once lived in its 13th storey penthouse.

The 184-room property was acquired by Mr Donato in 1987, but it ultimately closed in 2011. The Xanadu was in late 2023 listed for a $25m asking price on Bahama Islands Properties’ website, which says: “The 184 rooms has it all.

“Set on a world class beach, it also boasts a 75-slip marina with incredible potential, and in addition more than 20-plus acres strategically located near downtown and the airport. It is perfect for aggressive rooms and amenities expansion or adding condominiums.” Another realtor, James Sarles Realty, has the resort listed for $35m.