Old Bahama Bay Resort under new management

OBBSignature2

From the Old Bahama Bay Blog:

Old Bahama Bay Resort & Yacht Harbour invites guests to rediscover the sunny skies and gracious smiles of West End, Grand Bahama Island this fall as the resort re-launches with new management and exciting new affiliations. Old Bahama Bay is celebrating this milestone by offering a $150.00 per night room rate with a third night free in the hotel from September 4th through October 31st, 2012. Dockage in the marina is being offered at $1.00 per foot per night!

In early August 2012, a new management team took over resort operations spearheaded by Island Ventures Resort & Club, Ltd., a new hospitality company that is owned by the Old Bahama Bay property owners and whose principals were involved in opening and operating Old Bahama Bay from 2001 to 2007.

Old Bahama Bay is now a Guy Harvey Outpost Expedition Property: Guy Harvey Outpost Resorts & Marinas is a collection of properties in unique destinations owned and staffed by people who are passionate about their time on, in, and around the water.

Stuart Cove now operates an award-winning scuba diving operation directly from Old Bahama Bay. Guests can dive with sharks, rays, and other exciting sea life from a high-speed dive boat. Offered 3 times a week, the all-day Tiger Beach Shark Excursion offers a truly unique way to interact with these amazing creatures. The diving off of West End includes excellent wrecks, reefs, walls and wild dolphins – all located within an easy ride from the dock.

The new management team also has plans to make the following immediate improvements:

  • Upgrade the resort’s activities programs including the purchase of new bicycles and water sports equipment.
  • Restart weekend promotional events including beachfront bonfire cookouts and live Bahamian entertainment.
  • Restart its very special wedding programs

For more information or reservations please call 1-888-800-8959, email sales@oldbahambay.com or visit www.oldbahamabay.com.

Six months since title transfer

Six months has passed since the transfer of the development to the lenders group. While the new management company, Replay Resorts, has provided some information to lot owners, we are still anxiously waiting for an announcement regarding the direction of the development. Hopefully we will hear some news later this spring. At the time of the transfer, the Prime Minister of the Bahamas stated that the lenders group told the government "that during the first six months following the Lenders becoming the absolute owners of the mortgaged lands, they propose to focus on: master planning; re-engaging the marketplace; commencing a builders’ program; construction of model homes; and preparing for sales launch."

Other updates: The latest I have heard the airport is still closed. I will have some updated pictures of the houses under construction next week.

Less Atlantis, more like Green Turtle Cay and Hope Town

In an interview with the Tribune, Replay Resorts' chief operating officer Bill Green said their plans for the development "was now more to emulate the Family Island-style of living epitomised by communities such as Green Turtle Cay and Hope Town," rather than the previous mega-resort concept.

Green thinks refocusing the development is the right approach, and plans to cater to buyers that intend to remain long term owners and not flippers.

Replay is still in the process of making modifications to the master plan. "We're very cautious, because we think that if this next phase of development does not succeed, it will be a very severe blow to the development, so we want to make sure we don't miss."

"Connectivity to the water" and the close proximity to Florida's boating community will remain among highlights of the development. They plan to share their plans with the owners soon.

To stimulate home construction, Replay has arranged for home construction financing through Scotiabank and plans to build several model homes. They also announced today that they have cut the builder fee from 8% to a flat $5000.

Regarding the relationship with Lubert Adler, Green said that Replay are "proceeding on an individual path". "We have had many meetings and conversations with them, and wish them well. We need everyone to succeed here, but it's difficult to ascertain their plans and timing. A successful formula is one that enables us to proceed on our own."

Painting by Pat Anderson

Lubert Adler transfers management of Old Bahama Bay hotel to Condo owners

Lubert Adler's OBB Resort today announced that they plan to transfer management of the Old Bahama Bay hotel to the resort's condo owners, but plan to continue operate the marina and food and beverage operations.

The condo owners has not yet publicly stated whether they plan to keep the hotel open. All employees directly involved in the rental and property management would fall under the the responsibility of the 73-unit condo owners.

More info as we get it.

Source

Two developers, one West End

A clearer picture of the development's future is starting to take shape. Going forward there are two intertwined developers on the property, Replay Resorts on behalf of the Resort Holdings (aka Credit Suisse Lending Group / G-LA Resorts) and Crave Real Estate Ventures on behalf of LRA OBB Resorts (Lubert Adler) / West End Resort (WERL).

Replay manages all the red areas in the map above (larger map), which include:

  • Existing unsold lots
  • Majority of the undeveloped land, specially on the east side of the property.
  • Airport
  • Gate House and Beach Clubs

Crave manages the other areas (excluding West End Settlement), which include:

  • Golf Course (dedicated to the use for all owners)
  • The "Core" and North Shore next to Old Bahama Bay
  • Water and Sewer Utility Plants
  • Old Bahama Bay Resort and the connected residential development

With the land holdings intermingled, it is important that both teams agree on a unified vision for the development and work in tandem to offer complementary services and amenities. This is fairly common in the development of properties as large as West End.

Lorne Bassel, President of Crave, told the Bahamas Weekly that the "West End region is now a community of developers, not just a single entity. What that means is that present and future property owners can take comfort in the diversity of expertise and the concentration of focus. We’re happy to see other developers and investors involved. Anyone who understands this industry knows that having more participation from distinct contributors is beneficial to the entire effort, especially in today’s market.”

He expanded, “This new community structure allows all other stakeholders to assume control of their lands rather than rely on one company for all services. Many resorts have moved away from a ‘one ownership’ structure and become extremely successful. There are simply more people to carry the load.”

Bassel acknowledged to the Tribune that investor confidence in West End had been undermined by "the involvement of so many parties, together with uncertainty over division of land/responsibilities and the protracted process for the Credit Suisse-led lending syndicate to take control," but added that clarity will be restored.

While both developers are still tuning their plans, it is clear that the previous mega resort concept is a "a thing of the past." Instead expect a more sustainable, eco-friendly development with an authentic feel.

Basset told the The Nassau Guardian that "the concept of a hotel and casino has been placed on the back burner." To The Tribune he added that they "are doing what we can to stimulate interest [with external investors], and it'll come when the market and the financing is available. We are talking to different groups. We are making sure the opportunity is known internationally, but we aren't pushing too hard."

Instead, Crave plans to first build 25-30 homes on the western tip of Harbor Island (behind the OBB marina) through a partnership with West End Resort and slowly expand from there.

Derek Gape, senior Project manager for OBB Resorts told the Bahamas Weekly that “with the Old Bahama Bay condo hotel and marina as the existing anchor property, we are working to extend that success along the north shore beach land. That’s the natural and obvious path of progression for the property."

Replay has not announced plans for their parcels yet, but is actively seeking input from existing lot owners through surveys and phone conversations.

News Clippings

OBB Resort pursues 'critical mass' development

Old Bahama Bay owners clarify the situation on land ownership and responsibilities in West End developments

WEST END PROJECT 'CRAV-ING' SUCCESS

WEST END'S 'FRONT DOOR' DEAL BOOST

'NOT PUSHING' ON WEST END HOTEL/CASINO

Title Transfer Complete!

Finally!

Resort Holdings (aka Credit Suisse Lending Group / G-LA Resorts) today announced that it has obtained controlling title of the former Ginn Sur Mer resort community and has engaged Replay Resorts to continue its two-year relationship with the new owners in advancing the development of the resort community.

The transferred assets include 1,500 acres of land and the associated development rights, 632 finished lots, and an airport including a helicopter landing pad. Replay is an internationally recognized Vancouver-based company focused on the planning, design, development and operation of destination resorts and resort villages.

“Replay is an ideal partner to manage this incredible asset,” said Ted Dameris, Managing Director of the firm with the largest stake in the new ownership group. “With its extensive experience in large-scale master-planned resort developments, we are certain Replay can help us bring this irreplaceable oceanfront community back to life. We are also grateful to the Prime Minister and the Bahamian government which has been diligent and responsive when necessary to assist getting this transfer done in a timely manner.”

Although the Sur Mer resort community has endured a prolonged period of uncertainty, the new owners ensured that the construction of vital infrastructure never ceased and has now been completed. With the finalization of the title transfer process, the resort is ready to begin marketing again to potential owners. More than $500 million has been invested to create a distinctive community complete with a marina, hotel, golf course and airport.

On behalf of the new ownership group, Replay intends to bring this vision to fruition with preparations underway to re-engage the market and to continue the development of the residential component of the resort.

Over the next six months, the focus will be on master planning, re-engaging the marketplace with today’s emerging destination home customer in mind, commencing a builders’ program, construction of model homes, and preparing for a sales launch. This process will include market research within the US and Canada, as well as discussions with the existing owners in the community.

“We are pleased for all involved that this resort community has a chance to move forward once again,” said Bill Green, C.O.O. of Replay and spokesman for the project. “Dialogue will begin immediately with the current owners and other stakeholders so that they can help to shape the master planning process. We have been working with this ownership group at Ginn sur Mer for over two years and are eager to re- engage the marketplace”.

After years of nearly no communication from Ginn, it will be very nice to have an engaged development group involved with the project. I am still uncertain on Lubert Adler's involvement with the new entity - hopefully we will have some answers later in the week.

News Clippings

GINN SUR MER RESORT SOLD

Title transfer signals new beginning for Sur Mer

G-LA Resorts gains control of Ginn

BIG MOUNTAIN TO CLIMB' OVER EX-GINN PROJECT

Title Transfer Imminent

The Nassau Guardian is reporting the Replay is onsite at the development, and that the title transfer from Ginn is "imminent".

Bill Green, the chief operating officer of the aptly-named Replay Resorts Inc., told Guardian Business from Grand Bahama the company will take on the title on behalf of the owners and move forward with development.

“We’re trying to make our way through, but I can tell you the title transfer is imminent,” he said.

“We’re at the final stages now and we’re here in person because the title will transfer in the next few days. And we want to make sure if there are decisions made we have boots on the ground.”

...

Replay Resorts has been brought on to serve as manager of the still unnamed development. Originally envisioned as a $4.9 billion development, it was meant to include houses, condos, an airport, a marina and an Arnold Palmer-designed golf course.

Although many of these elements will likely come to pass, Green told Guardian Business a shift in development philosophy could be underway.

“Taking a look at the master plan, we will make sure it is paced and sized to match the speed of the market,” he explained.

“The houses we build must match the market. Florida purchasers who wanted to build big homes with a strong investment orientation are not so much the focus. Now we’re needing to look in other places and adjust. We also need to gear ourselves to people who spend significant time there because they love the place.”

...

Green confirmed that the Ginn Sur Mer name has been “taken off of everything”. For now, the staff are simply referring to the site as “Old Bahama Bay”

Resort Holdings ready to move forward after legislature passes transfer tax bill

The ongoing drama of Ginn's default is edging closer to a resolution. The Bahamas legislature this week passed a bill that allows Resort Holdings (aka Credit Suisse Lending Group / G-LA Resorts) to pay 2% stamp duty on the transfer of 1,500 acres (instead of the normal 12%), and assigns the lender "developer status" under the original Heads of Agreement. That agreement, which Ginn negotiated in 2005-2008, contains economic incentives for the development.

With the law passed, Credit Suisse is ready to execute transfer agreements in which Resort Holdings - a company owned by the lenders - would "become the absolute beneficial owner of the mortgaged property."

Resort Holdings proposed to the government that within the first six months following the transfer of the land, they will focus on "master planning; re-engaging the marketplace; commencing a builders’ program; construction of model homes; and preparing for sales launch."

It is still unclear if Resort Holdings and Lubert Adler are finally joining forces to develop the project together.

From the Bahamas Prime Minister

Background to the Ginn Act

My Government has tabled a Bill to amend the Modification of Provisions (Ginn LA-West End Grand Bahama) Act.

This honourable House may recall that in 2005, the Government of The Bahamas concluded a Heads of Agreement with Ginn-LA West End, Limited, the original Developer of the Ginn Sur Mer Project at West End, Grand Bahama.

The 2005 Heads of Agreement purported to grant the Developer considerable concessions which were not permissible in law.

My Government, in 2008, sought to honour the Agreement made between the Government and the Developer, and did so by enacting appropriate legislation to give effect to the concessions provided for in the Heads of Agreement. Accordingly, My Government enacted the Modification of Provisions (Ginn LA-West End Grand Bahama) Act 2008 (“the Ginn Act”) .

Many of the concessions in the Heads of Agreement related to the stamp duty rates which would be applicable in certain circumstances. Clause 2.1.8(a)(i) of the Agreement provided that the applicable rate of stamp duty for sales of $250,000 or more shall be 2% for any unimproved lot sold by the Developer during the period commencing on the date the Developer shall sell the first unimproved lot in the Project and ending on the date which is five years after the date on which the Developer shall sell the first unimproved lot in the Project.

In 2008, My Government concluded a Second Amendment to the Heads of Agreement. Clause 2 confirmed and ratified that the date of the first sale of an unimproved lot was the 12th day of October 2006. Accordingly, the concession provided under this provision will expire, five years later, on or about the 12th October 2011.

Background to the Mortgage

This Honourable House is advised that the Ginn Sur Mer project is owned by the Developer, as well as another company called Ginn-LA OBB, Limited, which was a subsidiary developer.

The Developer owns approximately 1,500 acres of the Project. The Developer mortgaged its land as security for a loan of $276,750,000 in favour of Ginn-LA Conduit Lender, Inc., which subsequently (in 2006) transferred its rights to Credit Suisse AG, Cayman Islands Branch as Administrative Agent and Collateral Agent for a syndicate of Lenders (“the Lenders”).

In 2008, the Developer defaulted on the loan and the Lenders commenced steps to realise their security. As at 2010, the parties contemplated amicable measures to convey the Borrower’s equity of redemption to the Lenders using the concessionary rate provided in the 2005 Heads of Agreement and the Ginn Act 2008.

My Government was advised that once these measures had proven unsuccessful, on 12th May 2011, the Lenders commenced foreclosure proceedings in the Supreme Court of The Bahamas. On 1st September 2011, the Lenders filed to discontinue the foreclosure proceedings, as the parties again determined that they would pursue a conveyance of the equity of redemption in the mortgaged property.

Conveyances to this effect were concluded and placed in escrow, pursuant to an Escrow Agreement executed on 31st August 2011, between the relevant parties. It is intend that a company owned by the Lenders, namely G-LA Resorts (Bahamas), Limited, would become the absolute beneficial owner of the mortgaged property.

Requests of the Government – Amendments to the Ginn Act

In furtherance of continuing the Ginn Project in respect of the mortgaged land, the Lenders have requested that Government:

  • Approve an assignment to the Lenders of the Heads of Agreement made the 9th day of December 2005 between the Government and Ginn-LA West End, Limited, as amended in 2006 and 2008;
  • Amend the Ginn Act 2008 to include the proposed assignment of the Heads of Agreement and to enable the Lenders to benefit from the Ginn Act as a Developer.
  • Amend the Ginn Act 2008, and Heads of Agreement, to enable the concessionary rate of 2% stamp duty to be applicable beyond the 12th October 2011, but solely in respect of the proposed conveyance of the equity of redemption from the Borrowers to the Lenders.
  • Allow no stamp duty to be payable on conveyances or transfers of property or equity interest in a property from a Developer to an entity wholly owned by members of the resort community (for example, a homeowners association). This is provided the property is for the benefit of the community. It is contemplated that this would accommodate the transfer of roadways, canals and amenities, which would otherwise have no intrinsic value.

Accordingly, My Government agreed and did so table the Modification of Provisions (Ginn LA-West End Grand Bahama) (Amendment) Bill, 2011.

In making such a decision, My Government took into consideration:

  • The potential benefit the continuation of this development would have on the economy of Grand Bahama
  • The capital invested in the Ginn Project to date
  • The Lenders’ development intentions once they become the absolute owners of the mortgaged properties.

My Government has been advised that approximately $505 million have been expended by the Developers as at 30th June 2011 on the development of the Ginn Project. Besides land acquisitions and various legal and marketing fees associated with the Project, the amount expended includes capital works amounting to approximately $200 million including in respect of

  • Roads and canals infrastructure
  • Marina infrastructure
  • Beach club and gatehouse facilities
  • The utility infrastructure required for the Project
  • And a championship 18-hole golf course

The Lenders have advised Government that it intends to continue the development of the property once they have full ownership of the same.

My Government has required that they do so in conformance with the plans and designs previously approved in the Heads of Agreement, as it relates to the mortgaged property.

The Government is advised that the Lenders have engaged in extensive preparations to continue the development of the residential component of the resort, including market research and planning.

They have retained Replay Resorts, a Canadian-based company which specialises in large-scale master planned resort developments, to move forward with the development.

The Lenders’ Project Timetable submitted to Government provides that during the first six months following the Lenders becoming the absolute owners of the mortgaged lands, they propose to focus on: master planning; re-engaging the marketplace; commencing a builders’ program; construction of model homes; and preparing for sales launch.

I am advised that whereas the Lenders were prepared to execute the conveyances in escrow, they are reluctant to close the transaction before knowing that they would be approved to obtain the benefits and concessions provided for by the Ginn Act 2008 to enable them to carry on the development as originally intended.

Accordingly, My Government has table the Bill to amend the Ginn Act before this Honourable House.

Read More...

Oct 10th: Statement from the goverment

Oct 10th: TRANSPARENCY CALL ON '$35M' CREDIT SUISSE TAX BREAK

Oct 7th: CREDIT SUISSE GAINS 10% PT GINN TAX BREAK

Oct 4th: JUSTICE BLASTS 'ABUSE' BY GINN/CREDIT SUISSE

Sep 9th: Credit Suisse 'drops' $4.9bn Ginn foreclose

Stuart Cove diving open at Old Bahama Bay

Last month Stuart Cover from Nassau opened a diving operation at Old Bahama Bay.

From their website:

Finally a resort-based modern dive operation has come to West End! Dive with Tiger Sharks and Lemon Sharks in a high-speed dive boat, based out of Old Bahama Bay Resort at West End. Offered three times a week, the all day Tiger Beach Shark Excursion offers a truly unique way to interact with these amazing creatures. This 'botique' dive operation offers highly personalized service (max of 8 divers on the boat) and with the total luxury of Old Bahama Bay Resort!

The diving off of West End offers so much more than just sharks, there are excellent wrecks, reefs, walls and wild dolphins all located within an easy ride from the dock.

Oceanfront in Old Bahama Bay for sale $3.2m

Mark Wood recently listed #6 Pine Island in Old Bahama Bay for $3.2m. Contact him directly for more information.

This Spectacular 4,000 square feet Island Style Home is a boaters dream home. This home is situated in the idyllic gated community of OLD BAHAMA BAY in West End on Grand Bahama Island only 56 miles from West Palm Beach, Florida. This five bedroom three and a half bath home will allow for plenty of room for out of town guests. The remarkable craftsmanship of this home truly needs to be seen to be appreciated. No expense has been spared in this luxurious one of a kind residence. It offers breathtaking Ocean views and deep water dockage on a 1 acre lot. This home is simply Island Living at its best with magnificent Sunsets and barefoot elegant charm.

Island living at its best with magnificent Sunsets and barefoot elegant charm!

Old Bahama Bay reports only very minor damage from Irene

From Old Bahama Bay: Hurricane Irene Report: We are very pleased to be able to report that there was only very minor damage to the resort area and all employees and residents of West End are safe and well. The resort is currently without power or water, but hope to have restored by tomorrow. The airport is expected to reopen tomorrow as well.

It appears West End escaped from a potentially damaging situation unscathed and we are all breathing a sigh of relief. Thank you for all your well wishes and concern.

Old Bahama Bay will be back open for guests on Tuesday - come see us!!!!

Ginn Foreclosure NOT Complete!

Update: The foreclosure did not occur, as both parties agreed it would be easier to simple transfer the land voluntarily. See later posts for updates.

The Nassau Guardian is reporting that the "intense three-year legal battle between the Ginn Development Company and a Credit Suisse-led consortium of lenders has finally come to an end."

Ginn agreed to the foreclosure of 1476 acres instead of paying more than $78 million in overdue payments ($61m in back payments, $16m in interest).

“The defendant does henceforth stand absolutely debarred and foreclosed of and from all right title interest and equity of redemption of in and to the said mortgaged property,” the Supreme Court ordered.

As previously reported, the Credit Suisse syndicate will now control the majority of the development, with Lubert Adler retaining the Core, North Shore Beach, and Old Bahama Bay.

Crave Real Estate has been retained by Adler to develop their property, and Replay Resorts are working with Credit Suisse.

With the foreclosure complete, the teams can move forward with a new vision for the development.

Credit Suisse hires Replay Resorts

Mark Wood from MLW Properties reported in his latest newsletter that Replay Resorts, a Canadian developer started by the people behind Intrawest and Whitler/Blackcomb Resort, will soon officially announce their plans to build and operate a resort on the property. Replay has worked as an adviser to Credit Suisse since the Ginn default occurred in 2009.

Replay and Credit Suisse would control about 75% of the developable land; Lubert Adler holds the remaining parcels including Old Bahama Bay, the core, and the north shore.

One obstacle that remains is that the foreclosure of the land has still not occurred.

Hopefully we will hear more from Replay before the summer!

Nandana - Ultra Luxury in West End

If you have visited West End and Old Bahama Bay recently, you have certainly seen the large detailed luxury oceanfront estate located across the canals. I recently learned that this estate, named "Nandana", is available for rent. Starting at $5,500 per night, it is a little pricier than a suite at Old Bahama Bay but definitely more spacious!

From their website:

"Nandana" (which means Paradise in the ancient tongue of Sanskrit) is a newly completed large luxury estate on a secluded beach near West End, Grand Bahama. Our luxurious and exceedingly private villa compound is a fully staffed, island home specifically created for intimate gatherings of up to ten family members or friends.

Nandana goes beyond the traditional villa vacation by providing guests with a wide range of luxury resort services, amenities and activities. These include gourmet cuisine, on-site masseuse, 120' infinity pool, Jacuzzi, Jet Skis, ATV's, 18-hole golf course, beach volleyball and more.

Designed by a renowned architectural firm in an Asian beach house style, the property is comprised of six separate buildings. A spectacular main house with soaring 40' ceilings is surrounded by five richly-appointed and free standing bedroom suites. The interior of the property has been constructed entirely of natural materials with massive amounts of imported Burmese teak covering the floors, walls and ceilings and natural stone forming most other surfaces. A professionally designed lighting system has been installed to emphasize the property's many distinctive architectural features.

Nice place!

Ginn West End Foundation still active

The Ginn West End Foundation, set up by Ginn and funded by revenue from lot sales, is still active with charity projects on the island. Derek Gape recently presented a sponsorship check "to The West End Eco-Fishing Camp Association, who along with the West End Police, Urban Renewal and team of volunteers will host a 12 week program from 9th April - 25th June in West End. Last year over 60 students were taught how to swim, fish, boatmanship, were educated in the field of ecology, participated in community clean up exercises and were taught to develop an entrepreneurial spirit where they can shape their future and that of their community."

Read More at Bahamas Weekly

How many lots were sold at Ginn sur Mer?

According to a lot owner list that we have seen, about 220 out of 496 available lots (44%) were sold by Ginn from 2006 through 2008. You can see the break down and location of the sold lots in the info graphic above. [Update - 194 lots appears to be the final number of lots that closed].

This matches statements Ginn officials recently made publically. In a declaration prepared for the inflated appraisals lawsuit, William McCracken stated that “there were approximately 215 undeveloped lots sold .... approximately 50% were cash buyers, and the others were financed.”

Project manager Derek Gape recently told the Nassau Guardian "that the $20 million per year spent on promotions at the onset of the project were worth it, bringing in $175 million in sales for the 194 properties."

Why does our $175m investor group not have a seat at the table?

Credit Suisse will after a two and half year delay soon foreclose on the mortgaged parts of the property (mostly the 300 unsold lots). Lubert Adler controls the other half - the core, Old Bahama Bay, golf course etc. What happens after the foreclosure is still uncertain. Who represents us, the lot owners that collectively invested some $175m into the development (220 lots sold at an average of $795k each), when these decisions get made? Should we try to have a seat at the table?

Original Ginn sur Mer artwork

In research for an upcoming article, I was going through my stack of closing documents (including the Property Owners Association and the Covenants, Conditions and Restrictions) and came across a CD with the below artwork. Putting the mess with the questionable ethics and financing scandals aside, Ginn sur Mer sure would have made a grand resort. [flickr]set:72157625738606321[/flickr]

The core value proposition of the property is still there - no other development in the Caribbean has a 7500ft runway, extensive canal system, space for multiple golf courses, and miles of beach front frontage. Let's hope Credit Suisse and Adler, after dragging their feet for more than two years, can get their act together.