Tenders out for three major preliminary projects, with 'execution' expected shortly

Infrastructure and roads to cost $95-100m, with Commercial Village to add another $15m, as Cable Beach developer prepares for three lead projects.

Straw Market relocation also kickstarted by new agreement's signing,with project to be completed by 2011.

Baha Mar is "on the cusp of execution" for the three main projects that will kick-start its $2.6 billion Cable Beach development, with infrastructure costs estimated to be between $95-$100 million, and total direct construction costs for the Commercial Village pegged at $1.5 million.

Robert Sands, Baha Mar's senior vice-president for administration and external affairs, told The Tribune that the three initial projects - all infrastructure-related - will be to construct the re-routed West Bay Street, the Commercial Village, and relocate the Cable Beach strip's eastern Straw Market to where the western one is now.

"The aggregate direct costs of construction in the Commercial Village will be around $15 million, and the infrastructure work, which includes the roads etc, the cost will he between $95-$100 million." Mr Sands said. "These are very advanced in terms of the development stages, and having signed yesterday we are on the cusp of execution. These are the the first projects we will embark on."

He added: "We're finalising the costs on the Straw Market at the moment. The intention is to relocate the eastern Straw Market to an area where the wester Straw Market is, and create an area we hope to call Pompey Village."

Pompey Village, Mr. Sands explained, would feature a number of amenities and attractions besides the Straw Market, and "will include authentic Bahamian-made items. It will attract visitors to things that are indigenous and authentically Bahamian."

Among the items and amenities set for inclusion in Pompey village, Mr. Sands said, were Baamian arts and crafts, plus ' down home' authentic Bahamian eating and dining experiences, such as daiquiri shacks and conch salad.

The Baha Mar executive said the tender for the West Ba Street roadworks contract was "at a very advanced stage", with the developer also having having received permission to "go out to tender" for the Commercial Village construction works as it awaits the finalising of some permits.

On the West Bay Street rerouting, Mr Sands said a totalof three bids had been submitted. All these bidders had received prior approval to bid from the Ministry of Works, and the developers and the Government were "finalising and reviewing the bids as we speak".

One of these bids is uderstood to be from a SOuth Carolina-based company, working in partnership with a Bahamian firm. The same group has also bid on the New Providence Road Improvement programme.
The $15 million construction costs for the Commercial Village include the cost for replacing the existing police and fire station along the Cable Beach strip, plus new offices for the Scotiabank, Fidelity Bank (Bahamas) and Commonwealth Bank branches that currently line the Cable Beach strip.

The figure does not include the cost of replacing the Cecil Wallace-Whitfiled Centre, or the Bahamas Development Bank and Gaming Board Offices.

LAst week's signing of the supplemental Heads of Agreement for the Baha Mar project has opened the door for the developers to start their construction activity.

Yet Mr. Sands said Baha Mar had not been idle while waiting to reach its new agreement with the Ingraham administration, having done "preliminary work" on realigning the Cable Beach golf course to accomodate the West Bay Street re-routing, and rebuilding the hotels' maintenance shed.

"We've done a lot of remedial work in anticipation of [the Heads of Agreement signing], so that we can jump start a number of preliminary works," Mr. Sands said.

STEPS

He added that the "next steps" were for the Baha Mar Joint Venture Company Ltd. to finalise its joint venture agreement with Harrah's Entertainment, which is taking a 43 percent equity stake in the project.

It is understood that Harrah's may be pumping as much as $250 million of its own capital into the project as equity, to go alongside the $400 million commited by Baha Mar's principals, Lyford Cay-based father-and-son duo, Dikran and Sarkis Izmirlian.

"We are ready to go. We are working on this very urgently, " Mr. Sands said.

When asked whether the global credit/liquidity crunch had impacted Baha Mar's debt financing lines, Mr. Sands replied: "Not at all, everything that has been committed will be there. "The important thing is that this project is not a one-year project. It is spread over time. What we are going through economically is just a situation today, and certainly by the time this project finishes in late 2011, the world economic cycle will have changed for the better.

Mr. Sands added that Baha Mar's two partners, Harrah's and Starwood, through their affinity and marketing schemes gave the redeveloped Cable Beach access to more than 100 million potential customers.

Describing this as an "immediate marketing opportunity". Mr. Sands said the strength of its partners "is a very positive situation for Baha Mar Joint Venture Company".

The West Bay Street re-routing roadworks were likely to take "slightly over a year", with work on the vertical construction of Harrah's 1,000 room Ceasar's Entertainment hotel and 100,000 square foot casino, plus Starwood's 'W' and St. Regis hotels, to start "immediately after that".

"The timelines are to finalise the [joint venture] documents, get the Parlimentary approval, do the roads, do the Straw Market, do the Commercial Village, and then build the main superstructure," Mr. Sands said.

On the Government side, it will have to table Parliamentary resolutions to approve the $5.962 million sales of Treasury land to Baha Mar, and also the $37,550 sale of the Crown's remaining interest in the land upon which the now-closed Beach Hotel sits.

Baha Mar had been seeking to negotiate a supplemental Heads of Agreement with the Government to account for the fact that the cost of its proposed project has increased from $1 billion to $2.6 billion. The April 6, 2005, Heads of Agreement signed between Baha Mar and the Christie government was for a $1 billion project.

A forecast on Baha Mar's likely economic impact, prepared by Global Insight, predicted that the project would create more than 7,000 "direct and indirect" jobs after becoming fully operational.

It was projected to attract 500,000 guests to its resorts in the first year after fully opening, and pump $560 million annually into the Bahamas gross domestic product (GDP). Several thousand jobs are also expected to be created.

Source: The Tribune