Government to provide guarantee to Fairmont Southampton developers
Government is to provide a guarantee for the development of the Fairmont Southampton hotel, the Premier told MPs this morning.
Answering questions from the OBA on the deal to develop the hotel, Mr Burt said there will be support in the form of a guarantee – but said no figure had been settled upon. An Act of Parliament is to detail the agreement, he said.
Mr Burt declined to reveal what "economic or financial support" had been requested by the hotel owners – saying he did not wish to reveal the terms of negotiation in public.
Earlier, the Premier said that Bermudians will be given a chance to invest in the hotel.
And as part of the deal signed between Government and Westend Properties Limited, the owners of the hotel site, some profits from the hotel will go into a Bermuda Trust Fund.
In a statement to MPs this morning, the Premier said: “With the able assistance of a team of expert counsel and technical officers, the Government of Bermuda and Westend Properties Limited have reached an agreement.
“That agreement has been set out in a Heads of Terms document and I can further advise this Honourable House that the document has been approved by the Cabinet.
“I can also advise this Honourable House that this agreement confirms the terms of the Government of Bermuda’s support for this vital project.” No details of the level of support were given.
He added: “This agreement advances the objective and fulfils an election promise by making provision for Bermudians to directly invest in this hotel redevelopment.
“The terms and scope of this investment opportunity will shortly be announced in greater detail.”
The Premier added: “In the Progressive Labour Party government’s 2020 Platform we promised to ‘create a national fund called The Bermuda Trust Fund that will benefit economically disadvantaged Bermudians to reduce generational income inequality’.
“The Platform indicated that ‘this fund will be seeded by economic investors in Bermuda who can invest directly into the Bermuda Trust Fund’.
"I am extremely pleased to advise this Honourable House and the public that this agreement provides for profit sharing from the hotel’s operations.
“The Government will pledge the proceeds of this profit sharing to the Bermuda Trust Fund on behalf of the people of Bermuda.”
The Premier added: “Though this is a time for hope, the agreement we have reached is the ‘end of the beginning’. There is more work to be done.
“Both sides now must deliver on those conditions set out in the agreement and the Government’s first task is to set about crafting the legislative support required that will be brought to this Honourable House when we return.
"This agreement is however significant progress, and I am confident that this transaction will close next month as intended and construction will commence shortly thereafter.“
He said the project will create more than 600 direct jobs during the redevelopment phase and following the reopening of the hotel for guests, which is planned for the late summer of 2023, 600 permanent jobs are to be created in what will be Bermuda’s largest hotel.