COVID-19 fallout too much for water operators to bear

by Anesta Henry

Pleasure cruise and water sports operators are drowning in major losses as a result of the current economic climate, which has already led to four of them closing operations and two others facing the possibility of taking their final sail.

Chairman of the Careenage Members Marina Association, Andrew King, told Barbados TODAY that the past seven months have been extremely difficult for the industry which suffered a blow when the COVID-19 pandemic hit in March, at the peak of what would have been the tourist season.

“It threw us off tremendously because the peak is when all of us make most of our money – from March right down to the end of the season. So, as a result of the impact, we have lost at least four of the operators and I am aware that there are at least one or two more operators that are getting ready now to kind of give up, because we have found ourselves in a situation where there is no income, there is no Government subsidy that we have benefitted from,” explained King who said that operators are now offering low rates to locals in an attempt to generate some revenue.

“We all have tried to apply for a Government subsidy, but there is nothing that is available to us in our sector. So it is at the point where most of us reached the stage of not being able to contend with the ongoing build-up of debt.”

King, whose association comprises 16 or 17 operators, spoke about that state of affairs on the heels of the Barbados Port Inc (BPI) announcement on Tuesday that it approved a 60 per cent discount on rents for tenants at the Shallow Draught and Careenage.

There are 24 tenants at the Shallow Draught and 59 at the Careenage, among them boat owners, water sports operators and those involved in island tours, pleasure cruising and fishing.

“We did, in fact, benefit tremendously from the discount rate that the Bridgetown Port has given us, and they have really stepped up to the challenge in keeping the lines of communication alive for tenants in the Careenage at this critical time of our operations,” King said.

However, the owner of Therapy Charters said he has two vessels which have mortgages on them but, thankfully, through an agreement with Fund Access Growth Fund, he has been able to make some arrangements to reflect the reality of the current business environment.

He said the closure of some businesses around the Careenage had also hurt
the operators.

“The other thing that has impacted us significantly was the closure of the Waterfront Café, because that generally drove a lot of traffic in our direction, and now the closure of the Marina Bar. And hanging over our heads very quickly is the reconstruction that is about to occur on all of those buildings [next to the Careenage]. So we are going to be pretty much at another disadvantage again.

“To be honest with you, there are one or two of us that have been able to pick up the occasional charter. Some of us are set up to accommodate sports fishing and turtle trips, which is the smaller vessels, but the bigger vessels like the catamarans, they are moving on the weekends but at extremely low rates to accommodate the local clientele.

“The COVID-19 protocols have allowed us to operate, but some of us now are operating at half the capacity, which is a major strain on the industry,” King said.

He noted that Minister of Maritime and Blue Economy Kirk Humphrey has done a good job working with the operators and communicating with them.

Meanwhile, vice-chairman of the association, Ronald Williams, of Wasn’t Me Catamaran Cruises, backed King’s sentiments about the struggle facing operators. He said the situation has forced some to perform a balancing act to keep their heads above water.

“We are definitely depending on the locals and I have to say thanks to all the locals who have cruised with us over the years and now. We have been doing this for the last 32 years; we have always had a local market that knows us, but everyone is feeling the pinch in one fashion or the other. As frontline workers in the direct tourism industry, we will feel it more than folks that will feel it down the line,” he said.

A release issued by the BPI on Tuesday indicated that the Board of Directors had approved the discounted rent which was initially offered for the April to June period when the national shutdown was in force, to mitigate against the spread of COVID-19, and was then extended to cover the July to September period and, most recently, October to December 2020.

The BPI’s Chief Executive Officer David Jean-Marie explained that even with some ease in travel and leisure activity restrictions, the Port recognised that the tenants would be struggling to generate enough revenue to be viable.

“This follows the loss of revenues that are unrecoverable, with the fallout of the tourist market and suspended summer activity. The Board, therefore, supported the requests for rent relief with the discount offer and further extended that offer considering the less than favourable outlook predicted for the winter tourist season,” he said.

“BPI recognises the importance of maintaining occupancy and restoring vibrancy to the waterfront and the implications for economic recovery.”

The rent relief will reduce BPI’s 2020/21 revenues by approximately $600 000. (anestahenry@barbadostoday.bb)