Marriott project takes off
By Staff Writer On November 21, 2012 @ 5:21 am In Local News
Construction of the Marriott-branded hotel has begun with Chinese workers and heavy equipment working at the Kingston site one year after the sod turning and following years of controversy about the project and its lack of transparency.
When this newspaper visited the construction site on Monday, the security guard on duty informed the reporter that the area was off limits to the media and that no inquiries were being entertained.
Shanghai Construction Group is the contractor executing the construction works and this company has been advanced some $2.036 billion by the National Industrial and Commercial Investments Limited (NICIL) through Atlantic Hotels Inc. whose annual report for 2011 said that this represented 20% of the construction cost for the hotel.
Meanwhile, the Office of the President in a statement yesterday rejected an article in the Kaieteur News of November 18, 2012 which referred to Cabinet Secretary Dr Roger Luncheon suggesting that the funds from the sale of Government’s 25 percent shares in the Guyana Telephone and Telegraph Company Limited was going towards funding the Marriott.
“The Cabinet Secretary Dr. Roger Luncheon categorically denies issuing such a confirmation. The Office of the President is calling on Kaieteur News to produce the evidence of the Cabinet Secretary’s confirmation or retract the headline publicly,” the statement from the Office of the President said.
Construction of the US$51M Marriott Hotel should have started at the beginning of the year however government was up to some months ago still seeking one or more participants who will collectively own 67 percent of the project’s equity amounting to US$8M.
AHI was incorporated on September 10, 2009 as a public private partnership to engage in development of the hospitality sector, including the construction, ownership and operation of a five-star international hotel.
Collectively, the total common equity of AHI will amount to US$12M and the government via NICIL will be a minority partner owning 33% of AHI’s equity amounting to US$4M. Overall, government will provide 1/3 of the project funding with the balance in subordinate loan stock. Republic Bank will provide US$27M of senior debt to the project.
Opposition parties in the National Assembly have severely criticised the Government for proposing to use taxpayer dollars as part of the equity for the hotel’s construction. And observers have slammed the proposals made in terms of the cost of construction and the financing arrangement inclusive of senior debt and syndicated loans to some of the investors. They expressed the concern that should there be a failure of the project, there will be differentiated prioritising of categories of investors in terms of recouping what they invested.
AHI recently advertised for casino, restaurant and nightclub operators to manage an entertainment mega complex which is to be part of the Marriott-branded hotel.
The advertisement said that the entertainment complex, which will be located on the western portion of the hotel site at Block Alpha, Kingston, Georgetown, overlooking the Atlantic Ocean and the Demerara River, is expected to comprise three components which are: a specialty restaurant of 777 square metres, a nightclub with 595 square metres and a casino with 1,372 square metres.
AHI is interested in receiving EOIs from either persons or companies, either individually or as part of a joint venture consortium. It said that preference will be given to submissions by companies which are established in their field of interest.
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