Gencom pledges to pay Fairmont Southampton redundancy cash back
The owners of the Fairmont Southampton last night pledged to repay the Government for redundancy cash handed over to former staff at the hotel.
A spokeswoman for Westend Properties, a subsidiary of US-based Gencom, said the company would also press ahead with a multimillion dollar renovation of the resort.
She added the company was “working very diligently to manage a very difficult and unprecedented economic situation that was due to reasons completely beyond our control”.
She added: “Despite rumours, an official has confirmed that the redundancy amounts paid to employees by Government will be paid back by Westend Properties Limited as soon as possible.
“It has also been confirmed that a significant amount of planning and pre-development work has been completed to date.
“The extensive $180 million property renovation will continue to proceed under the control of the current ownership group once funding has been secured in the market, which has been temporarily disrupted as a direct result of the worldwide global pandemic.”
Hundreds of staff members at the Southampton hotel lost their jobs on October 23, but did not receive their severance packages.
But staff were paid by the Government after Gencom missed the November 20 redundancy payment deadline.
The statement from Westend claimed the company had “attempted numerous times to lay out terms of a loan agreement with payment directly to the Bermuda Government”.
But the company said the Government instead decided to set up the loan terms with the employees.
Karim Alibhai, the founder and principal of Gencom, said the company was still committed to the island and the renovation of the hotel.
Mr Alibhai said: “Recent mistruths circulating have suggested that Westend is unable to complete the renovations resulting in permanent closure of the hotel, but I can confirm this is not true.
“Since purchasing the property, the ownership group, in conjunction with hotel management, have been working overtime to ensure that the property is well-managed during its temporary closure and that the necessary investment for both redundancy payments and renovation is secured as swiftly as the current economic climate allows.
“Simply put, the iconic Fairmont Southampton, which is such a large contributor to Bermuda’s tourism, cannot fail, and unlike other properties that may not have come to fruition, structurally the hotel is sound and ready for its long-anticipated facelift.”
The company statement added that the hotel had not been fully operational for more than eight months because of the closure of the island’s borders to combat Covid-19.
The company added: “The ownership group has had to fund significant losses due to the hotel’s closure throughout 2020, and the unanticipated early closure of the hotel impacted the financing of the redundancy payments, which were accounted for in the original renovation schedule for 2021.”
Gencom, a development and asset management company, bought Westend Properties in December last year.
Gencom also owns Rosewood Tucker’s Point, which it bought in 2017.
It later launched a $30 million renovation programme at the Hamilton Parish resort.