Bill tabled to set up Government-owned company to oversee Morgan’s Point
Legislation to create a Government-owned company to oversee Morgan’s Point has been tabled in the House of Assembly.
David Burt said the Morgan’s Point Company will be charged with managing the site with the goal of securing a return for Bermudian taxpayers.
“The goal moving forward is simple; we want to put the land on which the failed project sits into productive use and generate cash returns that will eventually return funds to taxpayers,” Mr Burt said.
Speaking on Friday, the Premier said: “Today’s tabling of the Morgan’s Point Act 2022 is the first step in that journey, and despite the painful and expensive history of this project, I look forward to sharing more details with Honourable Members during the debate on this important bill next week.”
Mr Burt told the House that to date more than $210 million of taxpayer dollars had been spent on the failed project, along with $7.7 million dollars a year in interest.
“The payment of the guarantee after the project failed was contractual, and the Bermuda Government had no discretion but to faithfully fulfil its obligations,” he said.
“Following a Supreme Court process, provisional liquidators were appointed and have held the company and its assets as they sought to secure and find a way to monetise the assets repay creditors including the Government of Bermuda.
“While that process is ongoing, to date no bids have been received that would provide as high a value for the people of Bermuda as taking ownership of the assets, with a view to future development.”
The Premier said that under the terms of the guarantee, the Government was not able to lay claim to all of the lands on Morgan’s Point – only the land that was under construction for the hotel, residences and the completed marina.
“Despite that staggering level of incompetence in not securing all of the exchanged land against the guarantee, the Bermuda Government will have recourse to the limited hard assets at the project site,” Mr Burt said.
“Accordingly, in this case, we will satisfy the majority of our secured loans by transferring the assets of George’s Bay Limited to a Government-owned company to be called the Morgan’s Point Company.”
He added that the appointed board would be “commercially focused”.
Businessmen Craig Christensen, Brian Duperreault and Nelson Hunt obtained the Morgan’s Point property as part of a land-swap deal with the Government and launched the $2 billion resort project.
However, the resort scheme – which was to include hotels, residential units and a marina – was beset with financial problems and the plans were gradually scaled back over the years.
Work on the Sandys site ground to a halt in 2018 after the original developers ran out of financing for the project, leaving the Government to bear the brunt of a $165 million guarantee – which was arranged by the former One Bermuda Alliance Government.
Curtis Dickinson, the former Minister of Finance, said last year that the Government decided to buy the debt to “give us more rights than exercising the guarantees”, but warned that any offers would have to be “sufficient to cover our claim”.
The Government announced in the Throne Speech that it intended to formally repeal the Morgan’s Point Resort Act 2014 and create a new corporate entity, “comprised of qualified directors to oversee and direct the completion of the project”.
The Government said that a team of advisers had worked for the past two years to find a way to realise a return on the Government’s guarantee of the failed Caroline Bay development.