President Bharrat Jagdeo yesterday said he is hoping that construction of the Marriott Hotel will start within the next two to three months as the government is about to enter into a public/private partnership with the Zublin Group in Grenada,
Jagdeo, during a news conference yesterday at the Office of the President, said that following a public tender two bids were received and the contract awarded to the lower bidder. He said that the government is on the verge of signing a Memorandum of Understanding (MOU) with the Zublin Group.
“I think the government will have… one third equity and the investor will have two thirds equity,” Jagdeo said. He did not reveal how much the project will cost or how much money government will be putting in, saying that since it is a mainly a private sector-owned project it is better that this information be revealed at the time of the official announcement.
The project has been on the drawing board since 2006, but had been delayed due to several factors. Word of the Zublin’s interest in the project first surfaced in May last year. Officials from Zublin Grenada Limited officials had said that the government had made them a “very attractive offer.” After initially refusing to say anything, the Privatisation Unit/ National Industrial and Commercial Investments Limited (NICIL) said that Zublin was only one of a number of prospective investors who had shown interest in investing in the Marriott Hotel project here. In the statement, it said government had entered into a Confidentiality Undertaking with Zublin “and any disclosures by Zublin, without the approval of government, would be a violation of this agreement.” It added that at that time, no commitments or agreements were entered into with Zublin.
Zublin Grenada Limited, according to its website, was established in November 2000 by the then parent company Züblin Bau AG, a large construction company from Switzerland. “Upon establishment, Zublin Grenada immediately embarked on one of Grenada’s biggest infrastructural development projects,” including working with the Grenada government “to develop and finance the island’s first cruise ship jetty and also a modern state of the art cruise ship terminal and duty free shopping complex.”
In 2003, Zublin Grenada became independent from its parent company via a management buyout and Züblin Bau AG was sold to the pan-European construction company Strabag AG from Austria/Germany, the website said.
The main partners and members of the Board of Directors in Zublin Grenada are Hendrik A. van Dijk, Sükrü Evrengün, and Winston Whyte.
“The Zublin team combines vast international experience in development, financing and realisation of large scale infrastructural and real estate projects. The team has established an exemplary track record in the Caribbean region for excellent projects from as early as the 1990s,”the company says on its website.
In June last year, Marriott International Inc. announced that it will open its first Marriott-branded hotel in Georgetown in 2013. It was said then that the hotel would operate under a management agreement with Atlantic Hotel Inc (AHI), which was owned by the Government of Guyana as part of a public-private partnership between the Government and private sector investors.
Urbahn Architects of New York will create the hotel’s state-of-the-art architectural and interior design concept, Marriott said in a statement which was released by the Government Information Agency and also posted on the Marriott website.
The administration has long wooed Marriott, with officials emphasising the project’s importance but it had a controversial and eventually ill-fated birth, with the first developer unable to move forward.
Government had been seeking investors for the project after the first bid collapsed amid controversy about the developers. The project was being developed by a Pakistani businessman Michael Ahmad and an Italian, Natale Barranco, under the registered company Adam Development and Urbahn Associates (ADUA) with offices in Manhattan, New York.
Concerns were raised about the company’s lack of construction experience with hotels of this size and the government had steadfastly refused to disclose the identity of the investors despite repeated calls for transparency.
Despite the challenge to their credentials, the New York-based developers went ahead with work in May 2008 demolishing the building that formerly housed the Government Food and Drug Analyst Department, the former Luckhoo Swimming Pool and a bond.
They also levelled the area, started building up the land and diverted to another area the sewage pipes that in the past emptied into the Atlantic in the vicinity earmarked for the development.
Local engineers had questioned the quality of the work done and some of it had to be redone. Government had first awarded the US$700,000 contract to Courtney Benn Contracting Services Limited but withdrew it to allow the investors to address the matter.