The Marriott Hotel is still making attempts to secure funding to build an entertainment centre which may help to service its debt, Horace James, the Officer in Charge of the National Industrial and Commercial Investments Limited (NICIL), the hotel’s lone shareholder said yesterday.
James signalled that some funding may come from Republic Bank for this venture. A forensic audit report released last December pegged NICIL’s investment in the project at US$41.6 million, above the US$36 million publicly stated previously.
Addressing reporters during an end-of-year press conference, James said that NICIL attended Marriott’s AGM a few weeks ago and the hotel’s Board expressed belief that the construction of an entertainment centre is the way to go. “They think that once they get through with that they will be able to get through the financial orders”, he stressed.
He said that based on the feedback the Hotel is “making do at the operational level” but is not able to service its debt and is hoping to get the centre up and running so that they can meet those outstanding obligations. He said that based on the feasibility studies that were done, the hotel would be dependent on that entertainment centre.
He said that he went through the feasibility study and it “looks good”. Based on that study if he was in authority he would have gone ahead with the project as he felt it is one that “could be done”.
James said that the hotels’ occupancy rate is good. “The problem with Marriott is not the operations of the hotel section that is what has been expected from the feasibility study.
They are living up to that section of it. Their problem is the additional revenue they should have obtained from the entertainment centre is not there”, he said.
Asked who will fund the construction of that centre, James said that there is an outstanding sum of money that Republic Bank has indicated might be possible. “Obviously they will have to revise their plan to Republic Bank before they are able to draw down on anything else”, he stressed.
Asked who is paying the loans if the Hotel is unable to, James said that the Minister of Finance was informed of the situation and NICIL hopes that he can assist in this area. “We and also Marriott wrote to him (Finance Minister).AHI wrote to the bank also …but the matter is not fully resolved as yet”, he said. He was unable to say how much money is owed at this point.
According to James most of the money NICIL had was utilized in the construction of the Hotel. “We have purchased shares in Marriot Hotel….US $4M, 100% shares…” he said stressing that all the transfers of money to the project occurred prior to June, 2015.
Asked about NICIL entering into so many agreements with confidentiality clauses and whether this will be a continuing trend, James reminded that the Chairman of NICIL’s Board Dr Maurice Odle did say that NICIL will be more open, a position he supports.
Responding to queries about others stepping forward to help fund the Marriott construction, he said that he was unable to say.
He said what he does know is that a loan was taken from Republic Bank in the name of Atlantic Hotel Inc (AHI) but NICIL was the guarantor. That he admitted, is now a problem.
James said that it would be accurate to state that NICIL is the 100% stake holder in Marriot Hotel.