Burt insists Fairmont Southampton had $50m guarantee
Confusion reigned over Government support for the redevelopment of the island’s biggest resort after the Premier insisted yesterday a $50 million guarantee was agreed with the developers in 2019.
But David Burt’s announcement contradicted statements from the Government last year that no such deal had been struck with US-based Gencom over its plan to revamp the Fairmont Southampton.
A Cabinet bust-up with Mr Burt over the way the Gencom deal was being handled is believed to be at the heart of Curtis Dickinson’s shock decision to quit his role as finance minister just days before last week’s Budget.
Mr Burt again refused to give details on the reasons for Mr Dickinson’s departure from the Cabinet.
He said: “In regard to disagreements on this matter, I’m not going to comment on that further than what we stated inside of the Budget statement and that was that the former Minister of Finance did agree in 2019 with Gencom for the provision of a $50 million guarantee for the support of this project.
“Things have changed since 2019 certainly – supply chain issues and other things have changed and we are going to make sure that we deliver a deal that has the best interests of the country in mind …”
Mr Burt said the total capitalisation of the Fairmont Southampton project was $376.2 million and that it had overseas funding of $222 million.
There was no mention of a $50 million guarantee in the 2019 Budget or in this year’s financial blueprint, which was presented last week.
The Premier signalled to MPs on February 4 that a deal with Gencom was imminent and Mr Dickinson resigned on February 14.
Mr Burt, who took over the finance portfolio in the wake of the resignation, failed to provide any details of an agreement on the Fairmont Southampton in the Budget statement.
He said: “There was no specific statement given inside the Budget statement because there were no specifics to give at that point in time.”
A Government spokeswoman told The Royal Gazette in March last year that the administration had not agreed to financial backing for the redevelopment.
The spokeswoman said: “The Government of Bermuda has not provided, and is not committed to provide, any form of financial guarantee to Westend Properties Limited, Gencom or any other companies related to the Fairmont Southampton Hotel.
“As part of Westend’s acquisition of the Hotel in December 2019, the Government did enter into a Letter of Intent to provide a guarantee subject to a number of conditions precedent. These conditions were not met, and the LoI expired on 31 December 2020.“
Mr Burt refused to say what the problem was with the conditions and why an agreement was not reached.
Mr Burt said yesterday: “We are continuing to work through are the contours of the deal.
“I’m not going to go, necessarily into sticking points – I don’t know think that it is helpful to go into the details of what may or may not happen.
The Premier said today that Curtis Dickinson “did agree in 2019 with Gencom for the provision of a $50 million guarantee for the support of this project (Fairmont Southampton).”
There is no mention of this in the 2019 Budget, or the one just announced. And last year the Government insisted: “The Government of Bermuda has not provided, and is not committed to provide, any form of financial guarantee.”
Could you clarify the issue please?
Is the Premier mistaken over the “$50 million agreement”?
Why did the Government say on March 10, 2021 that it had not committed to provide any form of financial guarantee?
“Lawyers have been working around the clock for the last two weeks trying to make sure that various matters are ironed out.”
Mr Dickinson’s departure is understood to have caused unease among some PLP MPs, but Mr Burt declined to comment on whether he was confident he would win any leadership challenge at the party’s delegate conference in October.
He said: “I’m not going to prejudge what may or may not happen in October.
“All I know is that I continue to serve as the leader of the Progressive Labour Party and we are all committed executing our election pledges.”
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