Gencom needs to go back to the drawing board
A picture is worth a thousand words, as the saying goes, and this was proved last week, judging by the visceral reaction to the artist’s impressions of the Fairmont Southampton’s building plans.
Gencom, the owner of the hotel, submitted the drawings as part of its application for a new special development order for the property. The application would supersede the previous SDO, which, while still building on a considerable amount of open space, was less ambitious.
The new SDO envisions the construction of 261 tourist and residential units. Once completed, about one third of the property would be built on.
The new developments are located in different areas of the property, but the densest construction is along the ridge to the west of the hotel and to the east on the site of the old Turtle Hill tennis courts.
At first glance, the images are shocking. Six-storey buildings, looking like the worst kind of postwar public housing, dominate the skyline.
Gencom, in the face of heavy criticism, has countered that the buildings, as presented on its own artist’s impressions, are conceptual, and that the final product will be more attractive and will also benefit from landscaping that is absent from the drawings.
Gencom also notes that the construction will take some 20 years and will happen only as and when the residential units are sold.
Further, Gencom argues that it is reducing the amount of open space to be used by building up rather than out, essentially saying, “imagine what this would like if all the units were all one or two storeys”.
Unsaid in Gencom’s recent defence, but important and included in the application, are the estimates that the project will inject more than $1.1 billion into the economy. According to its projections, $312 million will be spent on construction while it will indirectly generate $846 million over 20 years.
That includes the jobs that will be generated as a result and the increases in tourism that the reopening of the hotel and the new developments will generate.
Given the stagnant state of the economy, this kind of stimulus would be an enormous boost. None of this should be discounted.
It also has to be acknowledged that successfully running a hotel in Bermuda is expensive. The structural costs confronting hotel owners are among the highest in the world, and many need a real estate component to make the hotel sustainable. If Bermuda wants to stay in the tourism business, these are the concessions that need to be made.
Thus Walter Roban, the environment minister, has a difficult decision to make. The proposal looks dreadful to the naked eye and, as many critics have noted, looks out of sync with Bermuda and its vernacular. With more than 3,000 people signing a petition opposing the plan, this is a widely shared opinion.
The decision to concentrate the buildings on the ridgeline will provide million-dollar views for the people who buy them, which presumably is the point, while being anything but for those looking back at them. Bermuda sells itself on its natural beauty. This destroys it.
While Gencom has emphasised how much open space will be left untouched by this development, the reality is that 30 acres of the 100-acre site will be lost. This is not a small amount, and once gone, it is not coming back.
Against that, the economic importance of the development, accompanied by an SDO already being in place — albeit one that would result in less environmental damage — is important and would rejuvenate the economy, at least in the short term.
Mr Roban therefore needs to strike a balance between economic impact and environmental harm. This is not a new challenge for Bermuda, but that does not make it easier.
The other problem comes with Gencom’s standing as a good corporate citizen.
Its brazen failure to pay its own employees redundancy when it ceased operations, requiring the taxpayer to step in temporarily, continues to stick in the craw.
The protracted negotiations for the renovation and reopening of the hotel are also worrying. Securing financing in a pandemic followed by a period of rising interest rates is complicated, and the company deserves some sympathy for that. But the number of broken promises for the reopening, now said in the SDO documents to be the end of 2024, meaning another summer season will be lost — the fourth since it closed — does little to inspire confidence.
Equally, the protracted negotiations for a guarantee and tax relief — all in Gencom’s favour — suggest it will squeeze every penny it can out of the taxpayer. There is nothing wrong with that, but Bermuda should be equally hard-headed about defending its interests.
Some will believe this confirms the idea that Gencom’s purchase of the Southampton Princess was only ever a real estate play.
Cynics may also consider the possibility that the existing SDO proposal is simply the opening gambit in a negotiation, submitted in the expectation that it would cause uproar.
But if it is rejected as too much, then Gencom can come back with a watered-down proposal that will be approved because it now seems to be a reasonable compromise. This would not be the first time a developer in Bermuda has tried this approach.
It also fits in with Gencom’s framing of the proposal as being entirely binary. It seems to suggest that to save the 60 acres remaining, the development of 30 acres must be permitted, or that it could have proposed to cover even more open space by building lower.
This is not a binary proposition unless Gencom states that Bermuda must take it or leave it, though. Most people understand that some form of residential component may be necessary and such a mixed development is hardly unprecedented.
But the proposal as it stands is too big, too out of empathy with its surroundings, too out of sync with Bermuda’s image and, quite simply, too greedy.
Gencom should return to the drawing board and come back with a proposal that will be welcomed by the community.
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