By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Government has intervened in the escalating dispute over Old Bahama Bay by demanding that the parties involved in retaking the hotel’s management “cease and desist” until they obtain the necessary permits.

Phylicia Woods-Hanna, director of investments, in a March 21, 2025, letter asserted that Kingwood International Resorts and its affiliates will “violate” Bahamian law if they assume management of both the Grand Bahama resort and former Ginn sur mer project given that the Government has twice rejected the company’s application to conduct business in this nation.

In a letter copied to both Prime Minister Philip Davis KC and Chester Cooper, deputy prime minister and minister of tourism, investments and aviation, she said the Bahamas Investment Authority (BIA) had been informed that Kingwood or another of its affiliates in the Reunion Cay Group of Companies “has assumed management of the properties formerly known as ‘Ginn sur mer’”.

“We note that the NEC (National Economic Council) has not granted permission to the company to conduct business operations in The Bahamas,” Mrs Woods-Hanna wrote in a letter seen by Tribune Business. “Previously, the Authority has issued two refusal letters dated May 5 and December 6, 2022.

“In light of the foregoing, please be advised that the company (Kingwood/Reunion Cay) is in violation of the laws and regulations of the Bahamas Investment Authority (BIA) and the laws of the Commonwealth of The Bahamas.

“Until permission is granted to invest and operate, and in the absence of an Investments Board permit, this letter serves as your legal notice to cease and desist all business activities by your agents and associates or by proxy.”

However, representatives of Lubert Adler-Old Bahama Bay (LRA-OBB) voiced surprise over the Government’s intervention and questioned why it was becoming involved in a private commercial dispute between themselves and Island Ventures Resort and Club (IVRC), the entity formed by a group of Old Bahama Bay condo owners to keep the hotel open following Ginn’s 2011 default.

Having begun the process of retaking management control from IVRC on Friday, they said all action was being conducted through LRA-OBB and West End Resorts Ltd (WERL) as the legal owners of Old Bahama Bay and other properties and real estate in Grand Bahama’s West End. It is understood that LRA-OBB will push back and respond to the Government’s position on the management takeover as early as today.

And, rather than seek to block themselves, LRA-OBB representatives urged the Government, in particular the Ministry and Department of Labour, “to step in” and ensure that IVRC pays due severance and other benefits to its staff rather than seek to foist this liability on the new management entity.

Daniel Baker, an LRA-OBB representative, told Tribune Business: “Kingwood has no part in this. This is being done solely through LRA-OBB. That is the entity that has authority, that has ownership of the land, and has a right to run things. It’s unfortunate that we have people in government defending bad actors but it is what it is.”

However, this newspaper understands there are concerns that Kingwood is hiding behind LRA-OBB’s corporate identity in a bid to take over management of Old Bahama Bay and West End. The ‘LRA’ in LRA-OBB stands for Lubert Adler, the investment bank that was Ginn’s former financing partner, and which took over the West End development’s core property and Old Bahama Bay after the developer defaulted some 14 years ago.

It has been seeking a buyer, and exit route, for some time, and Tribune Business previously reported it had done an offshore deal with Kingwood where the latter’s principals took control of LRA-OBB and other affiliates. This newspaper saw documents showing Lubert Adler executives resigned en masse from their positions as officers and directors with a variety of Ginn-related companies on August 3, 2022.

Those departing included Ira Lubert and Dean Adler, Lubert Adler’s principals, plus Amanda ‘Amy’ Wilde, who for more than a decade had served as Lubert Adler’s ‘point person’ in trying to secure a new buyer/investor. They were replaced on three corporate Boards by Richard Nasser and Anthony Carll, respectively Kingwood’s resort division president and general manager of its Reunion resort in Orlando, Florida.

Messrs Nasser and Carll were described as president and vice-president/secretary, respectively, of LRA-OBB Ltd, which stands for (Lubert-Adler-Old Bahama Bay), the entity which owns the common areas around the Old Bahama Bay resort’s condominiums, pool, beach, marina, shops, restaurants, undeveloped golf course, and much of the land previously controlled by Ginn.

However, John MacDonald, IVRC’s president, circulated a package to Old Bahama Bay condo owners last week purporting to include LRA-OBB’s latest corporate filings dated March 10, 2025, which showed the Bahamian-domiciled entity’s Board as still being comprised of Lubert Adler executives.

And recently-published promotional material names Kingwood as the entity that will be taking over Old Bahama Bay’s management and operations on LRA-OBB’s behalf. 

Describing Kingwood as “a proven leader in hospitality”, the brochure sent to all Old Bahama Bay condo owners confirms: “Old Bahama Bay Resorts & Yacht Harbour Rental Management is the official on-site management company for villas located within Old Bahama Bay Resort and Yacht Harbour, managed by Kingwood International.”

Meanwhile, LRA-OBB and IVRC representatives disputed how successful the former’s bid to regain management control at Old Bahama Bay actually was. Mr MacDonald, for IVRC, confirmed that Mr Baker and Mr Carll, together with Cleveland Duncombe, Candid Security’s chief, and Don Churchill, whom LRA-OBB wanted to install as management head for the resort, appeared at the property on Friday.

“I say in the lobby waiting for them to come and take over. They stayed out front near security for over an hour-and-a-half and never come into our lobby,” the IVRC president said. “We were told they left because the Labour Board wanted to speak to them. They haven’t taken anything over yet. They didn’t come into any of our offices, no.”

Defiantly asserting that “we’re not leaving”, Mr MacDonald accused LRA-OBB of “moving the goal posts” in a bid to justify retaining IVRC’s $100,000 security deposit. Arguing that IVRC’s attorneys had disproved allegations that it owed around $200,000 in unpaid taxes and utility bills, he added that LRA-OBB then “came back” to claim a near-$600,000 sum that was almost three times’ higher.

And, with LRA-OBB declining IVRC’s suggestion to place the $100,000 security deposit in escrow until all differences were resolved, Mr MacDonald said: “It just keeps telling us they have no intent to pay this money back. Come on.”

Asked whether the Old Bahama Bay fight is headed to the courts, Mr MacDonald replied: “Hopefully not, but we are teed up with a large amount of money. Our lawyers, they’ve already got a ‘go’ button. If it happens, it happens.” He suggested that any legal battle will last “a long time”, and said the next move belongs to LRA-OBB.

Mr Baker, though, told Tribune Business that LRA-OBB had achieved “most of our first phase transition objectives” on Friday after giving IVRC seven weeks’ notice - far more than what was required - that its licence to manage Old Bahama Bay was going to be terminated.

Via Candid Security, he added that LRA-OBB had taken control of both the security gate for the resort and general security at the site from 12pm on Friday. “There are three Bahamian licensees that run the straw bar, the restaurant and retail,” Mr Baker said. “We issued new licences to them to operate so those functions could continue.

“The last thing we were going to do was extend independent contractor agreements to staff managing the marina and gardens and recreation areas. We’ve been working super diligently to make sure we’re doing everything in accordance with Bahamian law.”

Mr Baker, though, explained that LRA-OBB was unable to issue the independent contractor agreements after the Ministry and Department of Labour raised concerns over the payment of severance and other benefits due to staff now that their employment with IVRC is ending.

He and Michael Scott KC, LRA-OBB’s attorney, both disclosed that government labour officials had wanted themselves to assume responsibility for the payout - something they refused to do on the basis that these liabilities belong to Mr MacDonald and IVRC. Mr Baker said that, once they receive the go-ahead from the Ministry of Labour’s attorney, the independent contractor agreements could be issued as early as today.

“The ministry needs to go after John MacDonald,” he added. “The Government needs to step in and protect the employees of IVRC.” Working with the Department of Labour and National Insurance Board (NIB), Mr Baker said it was estimated that some 51 workers are collectively owed around $350,000 in severance and other benefits.

Mr Scott, meanwhile, told Tribune Business of the BIA letter: “John MacDonald has gone running to the Government through the BIA and they’re trying to use them to leverage us; pressure tactics. This is a commercial agreement between two private entities that has got nothing to do with the Government.

“They [LRA-OBB] did have a meeting with the Labour Department but that had nothing to do with them taking control... I was told that the Labour Department tried to get my clients to pay the arrears of salary for people gainfully employed by him [Mr MacDonald and IVRC] at the site - his employees - on the basis that having repudiated or terminated the licence we have assumed responsibility for his employees.

“That’s a lot of rubbish. He has an obligation to his employees; that has nothing to do with us. If we re-employ them they become our problem, but he has to fulfill his obligations under the Employment Act.”