You're due to open an US$3.5 billion project on Friday. On Tuesday, you cancel; just three days to go. Embarrassing? A touch. That was the story last week with the Baha Mar mega-resort in the Bahamas.The original date was December, just in time for the peak winter tourist season. That target was abandoned late last year. Now March 27 hasn't happened. It looks like early May.
The developers blame their state-owned Chinese contractors. Said Tuesday's release: "In setting our opening date for March 27, we relied in good faith on the representations of the resort's construction manager and lead contractor."But "it has become clear that the contractor has not completed the work with an attention to detail consistent with Baha Mar standards of excellence." By corporate communications standards, that's blunt enough.Those comments are "wholly inappropriate and inconsistent with the history of this project," says the contractor.
Stephen Wrinkle, past president of the Bahamas Contractors' Association, says: "We shouldn't continue doing projects in the same manner as this one, and expect different results. It's not going to happen."The contractors have a US$150 million equity stake. They're both insiders and outsiders. The other US$850 million is held by Swiss-Bahamian investor, Sarkis Izmirlian. Then there's a US$2.5 billion loan from the Import-Export Bank of China.
Meanwhile, Baha Mar has management contracts with big hotel brands–Grand Hyatt and Rosewood for starters. They will not be delighted.This is starting to look like fun for the lawyers. And the customers? Says Baha Mar's Facebook page: "If you currently have reservations, please be assured that our team is in the process of reaching out to you."Reaching out to a bunch of angry pre-booked customers is a challenge.
Says Joanie Antonacci: "I have left messages, sent messages and still waiting patiently since yesterday. I would really like to speak to someone regarding this situation, I really hope that gets resolved asap please call me."The response: "Hello Joanie, we are currently working through the inquiries by arrival date and will reach out to you as soon as possible. We understand your frustration and are doing our best to compensate you for your troubles."
And from Tipton Law Offices: "I was booked for April 2-7. Been looking forward to this for weeks. $2,500 in non-refundable airfare. One week's notice??? All I can say is WOW!!! What a black eye on this resort and PR nightmare."There are other worries besides the delay.There's a neighbours' dispute with the adjoining SuperClubs Beaches property. And a tiff with the government over road diversion costs.The resort will gobble electricity, with monthly bills of perhaps US$3 million. Nassau's creaking power system is already plagued with blackouts.
And the murder rate last year was higher than ours. Just last Wednesday, the US State Department warned that the crime threat is "critical."But to be fair, let's stand back a bit. One year on, these troubles may be ancient history.This latest setback is around six weeks. A late start is better than opening with last-minute mess-ups, consumer complaints and lousy reviews on Trip Advisor. And the US consumer market is on an upswing.
When it does open, Baha Mar will be mega-glitzy even by Bahamian standards. It will have 2,200 rooms in four hotels; plus 284 private residences, and 40 restaurants, bars and lounges.It's a fair trek across this 1,000-acre site to get to the beach, but there will be six swimming pools, and a Jack Nicklaus golf course.And there's the casino. That's 100,000 square feet–around 2.3 acres, with more than a thousand slot machines; plenty ways to lose your money.When it does open, the economic whoomph will be enormous.
The Bahamian economy has been drifting. Tourist arrivals are still below their 2005 peak. Baha Mar will bring around 5,000 new jobs, almost all of them for Bahamians.Trouble is, there's some delicate fine tuning. Airlift into the Bahamas needs to be stepped up in line with new hotel capacity.ast week's cancellation will annoy the airlines almost as much as the displaced hotel guests. Empty seats cost money. Looking forward, Baha Mar badly needs to keep June flight schedules intact.
On the upside, the resort has been talking to two Chinese airlines about direct flights from that fast-growing market. But forget China for now. The core market for Caribbean tourism is the north-eastern USA and eastern Canada. For the Bahamas to benefit from Baha Mar, its marketing blitz will need to boost new traffic. If it just diverts business from the existing hotels, that will spell trouble all round–not least for the 3,400-room Atlantis resort on nearby Paradise Island.
Your vacation plans not fixed? Why not give it a whirl? The Rosewood starts at just US$630 a night–and right now, says their Web site: "The first night is on us." When it opens.