Club Med deal crashes ? again
Without producing a single drawing or plan for the public the latest Club Med resort developer Jack Avedikian has fallen by the wayside.
For the second time in 11 months a Government-favoured developer for the derelict resort has been dropped to again leave a question mark over the future of the site.
Confusingly, Premier Ewart Brown claimed the media had been informed of the latest twist in the Club Med more than six weeks ago, yet the has never received such notification and no other news outlet on the Island is known to have carried the story until it was confirmed by him yesterday lunchtime.
The continuing uncertainty surrounding the Club Med edifice, which closed as a resort almost 20 year ago, spoilt what was otherwise an upbeat and smoothly choreographed release of positive tourism figures by the Premier, who continues to hold the tourism portfolio.
He confirmed Mr. Avedikian?s company KJA Developments? period of exclusivity as favoured developer had been terminated around the end of September.
At the start of the year Mr. Avedikian controversially replaced the Quorum Group, which had been working on a proposal for a Four Seasons Hotel at the St. George?s location and was reportedly close to completing a $220 million deal.
The Connecticut-based developer, who had been involved in two family-related bankruptcy rulings in the US, never appeared at a public event in Bermuda although he spoke to in mid-September shortly before the time the exclusivity agreement is purported to have been terminated.
Explaining what happened, Dr. Brown said: ?We are serious about developing that site and any developer who does meet the timelines and the requirements of our Government will find themselves in that position.
?I can report that the request for proposal to develop that property has already been completed and I expect in the next two weeks to receive at least three indications of interest from other developers.?
He was not able to say whether the one-time favoured Quorum Group were amongst those to have expressed interest.
Asked about the likely frustration of residents on hearing the Club Med news, he answered: ?I share the frustration. That property has sat there for a long time and we thought that when we started to do business with the KJA Developments that we had a winner and it proved not to be the case.
?We acknowledged it and in fact we informed the media over a month and a half ago that the period of exclusivity had ended.
?The difference between the way we are doing it now and the way it was done in the past is that we are not allowing people who are not performing to languish.
?When you don?t perform for Bermuda then we will have to find a replacement. That is out to bid and we will see what happens, but I?m committed to seeing development on that site during the next calendar year.?
A request by the for proof that Government previously made public the collapse of the KJA deal has, as yet, not met with a response.
American hotel financier Bill Steckforth was critical of the ending of the Quorum Group?s interest in developing the site and warned in January that Bermuda needed to be careful not to frighten off the handful of big money lenders capable of financing luxury hotel developments.
The president of Florida-based Steckforth Hospitality Group was involved in trying to bring a Regent Hotel to Hamilton in 2003 and 2004 and said he was not surprised to hear that KJA Developments had been sidelined.
?Getting people to invest hundreds of millions of dollars in a project is really difficult. I was involved in the plan for a Regent Hotel in downtown Hamilton, I spent three years on that project and never made a nickel.
?The whole thing was financed and it was dropped. And then the same happened to the group with Four Seasons looking at Club Med,? he said.
?You can?t afford to walk away from people like Four Seasons. I?d say the lender I work with is now afraid of Bermuda and this lender is one of only a handful in the world who can finance this type of thing. You can?t summarily dismiss people like that, it does not make sense.?
Mr. Steckforth suggested Bermuda work to create a defined methology for developers to follow, a form of checklist that a developer would be confident that if they followed it through would move their project forward rather than face apparently random dismissal.
Shadow Tourism Minister David Dodwell asked: ?How much longer can Government continue to build up hopes on Club Med when we have something like this happening?
?We (The United Bermuda Party) and a large number of people in the community expressed doubts about this individual and the company and it seems our concerns were justified.
?No hotel brand was ever named and we did not see any plan. The whole thing had the sense of a non-starter and he never presented himself to the public.?
He added: ?How on earth did we lose Quorum who had a good plan and, in Four Seasons, an excellent operator and all the answers and the funding?
?How can we believe the next claim for the site when the last one has fallen? The track record of Government here is poor, they continue to give St. George?s and Bermuda false hopes.?
St. George?s Mayor Mariea Caisey said: ?I would rather Government takes its time and gets the right developer rather than jump in and it end as a catastrophe for the town.?
She expects the Premier to speak to townsfolk on the news at a town meeting on November 29.
And former town mayor E. Michael Jones, who for a time was KJA?s spokesman on the Island, said he had not had a chance to speak to Mr. Avedikian about the latest news but he also hoped Dr. Brown would drive a hotel development to fruition at St. George for the benefit of the town.
Neither Mr. Avedikian nor anyone from KJA were available for comment at the time of going to press.