Baha Mar Liquidation May Start Next Month after Layoffs

The Bahamas' stalled Baha Mar resort may begin its formal asset-liquidation process as soon as early next month, as negotiations have failed to produce an agreement between the project's developer, lender and contractor, resulting in 2,000 employees being laid off Friday.

The Bahamas Supreme Court on Thursday granted the project's provisional liquidators request to fire management and service staff because the project has been stalled since late June. The decision "further highlights the urgency for everyone to remain at the negotiating table and maintain the dialogue that may lead to a resolution, a restart of construction and the completion of the Baha Mar project," said Edmund Rahming, managing director at KRyS Global, one of the provisional liquidators.

Baha Mar Ltd. principal Sarkis Izmirlian, in a letter obtained by Travel Weekly this week, said there was "simply no way for Baha Mar to sustain the thousands of jobs" on the project.

The government, which in the Bahamas is considered a separate entity as the Supreme Court, has said it may begin the project's formal liquidation process as soon as Nov. 2.

"The Government has made the strongest possible representation to the joint provisional liquidators and the stakeholders in this commercial transaction between the developer Baha Mar, the secured lender, China Export Import Bank, and the principal contractor and equity partner China State Engineering and Construction Company, for the retention of Bahamians staff," the government said in a statement. "The government is presently engaged in meetings and other dialogue with the relevant stakeholders and the joint provisional liquidators to arrive at the best possible solution which will best serve the national interest."

Construction delays led developer Baha Mar Ltd. to file for bankruptcy in late June so that it could protect its assets and complete the resort, which the developer says is 97 percent built. Since then, talks between the developer, lender, contractor and Bahamian government have been contentious, and the U.S. Bankruptcy Court in Delaware threw out the case last month.

Baha Mar was slated to include the 1,000-room Baha Mar Casino & Hotel, the 707-room Grand Hyatt at Baha Mar, the 300-room SLS Lux at Baha Mar and the 200-room Rosewood at Baha Mar. The project's fifth hotel and lone pre-existing property, the 694-room Melia Nassau Beach, remains open.

Source: Travel Weekly