Officials of Sandals Resorts International (SRI) are willing to continue construction of the highly publicized $400 million Beaches project slated for the old Almond Beach Resort property in St Peter.
However, Group Deputy Chairman Adam Stewart said this would only take place if the Mia Mottley administration makes good on the original deal signed with the Freundel Stuart administration when the SRI group first entered the island in 2013.
The Jamaica-based SRI is the operator of both the Sandals and Beaches brands.
In an exclusive interview with Barbados TODAY Stewart insisted that Sandals officials did not request anything new, and said he remained “steadfast” that the only thing asked for was that the Government honour what was in the original agreement.
“So we didn’t ask for anything new. We did not ask for anything outside of what was exactly in the original negotiation,” said Stewart.
Earlier this year the Beaches project hit a snag when Prime Minister Mia Mottley announced that her administration was in discussion with SRI officials who wanted “even greater levels of assurances and guarantees”.
At the time, Mottley explained that the company wanted the Government of Barbados to “indemnify them if any future Parliament at any stage in the next 40 years were ever to tax them for anything in the industry for any goods or services that others in the industry were paying taxes for”.
However, Mottley made it clear that it would be unfair to the country for her administration to honour that request.
So far the company has invested about US$17 million on beach work at the location but stopped the project following the revelation by the prime minister.
However, Stewart told Barbados TODAY that it was never a case of the company wanting any new concessions, but simply for the Government to stick to the original agreement.
And while insisting that Sandals was in no way in an adversarial relationship with the Government, the Sandals boss said the ball was now in the new Barbados Labour Party administration’s court and he had no intention of applying any pressure.
“I want to be clear, we are not in an adversarial position whatsoever with the Government. We have a tremendous amount of respect for both sides of the political divide and for Prime Minister Mottley. The Minister of Tourism [Kerrie Symmonds] has been a great friend of the company. We have done many things in the international marketplace. The relationship is not adversarial, but US$450 million is what we call superman money. And for us to take that risk we would only do it under the original agreement,” he said.
“We are the investor. We are not the Government. So we are waiting for the government to decide whether or not they want it on the original terms that we agreed. As I will say again, we are not asking for anything that was not in the original agreement. There were a bunch of insinuations that we changed the agreement and I am waiting for somebody to show any of us what that was,” he explained.
In the original agreement, Sandals was offered concessions, which included a 25-year tax break inclusive of a waiver on all import duties, taxes, levies on capital goods, such as building materials as well as goods and beverages.
Defending the concessions, Stewart pointed to the significant investment of the renowned Jamaican hotel chain as well as its impact on the economy, saying “It is a US$450 million development. It is easily the largest of what Barbados would have seen.”
Pointing to the company’s Christ Church Sandals properties, the first of which started in 2013, Stewart added that the international hotel chain has been a top-performing brand for the island “since the day it opened” and that it was providing significant employment opportunities and economic benefits through taxes.
“One of the things people don’t understand is that Sandals very much pays taxes. It is a bit of a misnomer as to whether we pay taxes. What we have done is that we have agreed on a tax rate and because of the quantum of the investment we asked for stabilization around the tax rate, that is, the Government cannot wake up in five years and change the parameters to which we would have invested the better part of almost US$1 billion in Barbados,” he said.
“So we don’t feel that we are there yet in terms of the Government fully conforming to the spirit of what we negotiated. So at that point, we are not prepared to go any further with that,” he insisted.
After several setbacks, the Beaches project started with minor work in 2018 including construction along the beach.
The project was expected to last about 27 months and employ some 1,800 people throughout the process.
It was earmarked to be Sandals’ most elaborate project to date, consisting of about 600 rooms, a number of unrivaled amenities including a six-lane bowling alley, on-property train, water slides, a zip line, and numerous global gourmet restaurants.
Stewart said the performance of both sister properties, Sandals Barbados and Sandals Royal Barbados, was “raging”. He explained “We are full. You can’t get in..the highest ADR [Average Daily Rate] on the island.”
“We have had a material impact on the airlift. Since Sandals has come there we created four billion new media impressions saying the word Barbados. We have brought more American clientele as opposed to just the British. So we have the British and the European, but we have been able to propel the American clientele, which was a part of the vision of the Government we did the agreement with,” he said.
Asked about plans to rekindle discussions to have a Sandals in the twin-island Trinidad and Tobago, Stewart said that was not on the cards.
However, he told Barbados TODAY that SRI continued to invest “all over the place” while pointing out that the company has to date invested some US$200 million in upgrades and expansion of its Jamaica operations.
He said officials were also in discussions with the government of the Bahamas in order to develop a Beaches resort there.
He was speaking on the sidelines of a special reception for the Jamaica Product Exchange (JAPEX) 2019 at the Sandals Montego Bay property on Tuesday night.
