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Gencom plan a cause for concern

Kim Smith is the executive director of the Bermuda Environmental Sustainability Taskforce

In mid-2021, the Bermuda Environmental Sustainability Taskforce was shown conceptual drawings for expanded development of the Fairmont Southampton resort. That plan is for a threefold increase in the number of residential units to be built over what was granted by Special Development Order in 2009, and would require a new or amended SDO to be granted by the Bermuda Government. The request will be to construct more than 350 residential units on the site, in blocks ranging from two to five5 storeys high.

BEST sees no justification for such an expansion and we cannot imagine a basis on which a threefold increase in the number of residential units could be supported. We would like to see the detailed data that supports a claim that this development is beneficial to Bermuda in the long term.

We would also like to hear more from the former Minister of Finance, Curtis Dickinson, about “past practices of Gencom that caused him concern”; concerns that were seemingly part of the reason he quit so abruptly in mid-February.

A quote from Mr Dickinson conveys some of his unease: “Given the Government’s current fiscal position, is it prudent to give future tax revenues to developers who by virtue of their own financial returns projections would already be projected to earn multiples of their invested capital? Even if changes to existing tourism incentives are warranted, perhaps the analysis should be completed first for the industry at large rather than predicated on a single request. Otherwise, the overall cost could be astounding, and without the analysis I am unsure if it will be worth the rush.”

Despite the concessions that will be — or have already been — extended by the Government to renovate and reopen the hotel, we have concerns that Gencom will claim the inability to secure the financing needed to complete those renovations and that they will apply for a new or amended SDO to build and sell off residential units to provide the financing. Does such a scenario seem to hold the hotel project to ransom?

There has been some controversy surrounding the relationship between the Bermuda Government and Gencom for reasons that have not been disclosed. Given past criticism of selling Bermuda land to non-Bermudians, we would be surprised that the Government could contemplate doing just that, especially on such a large scale. In our opinion, the 2009 SDO already provides excessive development rights and we are concerned that any expansion of the existing SDO would provide far greater benefits to Gencom than to Bermuda.

We believe Gencom should reopen the hotel as the first priority and prove the benefits to Bermuda of its expertise. That would allow Bermudians to develop confidence in the operation of the project as it evolves. Additional comparative information from Gencom’s Tucker’s Point operation would also help to prove the actual value of these types of developments to Bermuda. The 2009 Tucker’s Point SDO gave permission to build on valuable and protected open (green) space; development that has or will be sold off mostly, if not entirely, to non-Bermudians. It would be beneficial to see an analysis of the economic benefit to Bermuda of that development now.

If a new or amended SDO is requested that proposes expanded residential development at the Fairmont Southampton, it is likely that BEST will ask for the community to oppose that. However, there is no need to wait; call, e-mail or write to your Member of Parliament — your representative in government — to formally register your own concerns.

Kim Smith is the executive director of the Bermuda Environmental Sustainability Taskforce

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Published April 22, 2022 at 8:17 am (Updated April 22, 2022 at 8:17 am)

Gencom plan a cause for concern

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