Shadow Finance Minister Carl Greenidge said the government of Guyana might be on a “fishing expedition” in an effort to bring financial closure on the estimated US$58 million Marriott Hotel (Guyana) Project.
On September 19, 2013, Atlantic Hotel Incorporated (AHI) Chairman Winston Brassington had boldly stated that AHI would have achieved financial closure at the end of that year.
At the time, the company had already spent US$20 million on the project. But to date, Brassington has been tight-lipped on the matter.
Brassington had announced that Republic Bank would have invested US$27 million in the project, the National Industrial and Commercial Investments Limited (NICIL), US$19.5 million and a collective US$12 million would have been garnered from two private investors. But although this financial plan was outlined, there was no financial closure on the part of Republic Bank.
Deadline
Greenidge told this publication that with the August deadline approaching, there is a possibility that government might be “fishing for investors to finance the project”.
He said there was also a possibility that the project could be completed using mostly state funds.
If this occurs, he said, it will be a very unfortunate situation, with statistical reports indicating that the occupancy levels of hotels around the country remain below 30 per cent.
Though the financial status of the project remains largely unknown by the public, when GTI visited the hotel site at Kingston, Chinese labourers were working on the exterior and interior of the building.
Romesh Budhram, an official at the construction site, declined to answer when asked for a progress report, stating that permission must be granted first from the AHI Chairman.
Currently, NICIL is partnering with a private investor to acquire the required equity. The investor will be injecting US$8 million, while NICIL will invest US$12 million. The two parties have struck a shareholders’ agreement.
Additionally, the debt is coming from three areas. It was explained that US$27 million is being syndicated from Republic Bank, US$4 million will come from the investor who will be operating the entertainment complex of the hotel, and NICIL will put one-third of the debt – US$15.5 million.
However, AHI still requires financial closure on the multimillion-dollar first-class hotel.
“All we are waiting on is conclusion of the legal paperwork with Republic Bank, we have every confidence that we will conclude the financing and within a short period, we hope to close the entire transaction, the equity investor and the Republic Bank financing,” Brassington had stated.
Despite vehement criticism, the government and Marriott signed an agreement in June 2010, paving the way for the hotel to be operated by Marriott.
Government has executed a number of agreements with Marriott, starting in 2009 to operate the hotel for up to 30 years. These include the Management Agreement, the Licence and Royalty Agreement, the International Services Agreement, and the Technical Services Agreement.
Marriott Guyana is anticipated to feature 197 rooms, a restaurant, a bar, a lounge, an outdoor pool, a spa, a fitness centre, a business centre, and roughly 12,800 square feet of conference and function space.
