Jamaica Shuts Down RIU Resort Project

Things have turned testy in Jamaica in recent days, thanks to a construction setback that threatens to stem a wave of Spanish investment that has pumped billions of dollars into new resorts and hotels, primarily along the resort-heavy north coast.

Prime Minister Bruce Golding last week ordered RIU Hotels & Resorts to halt all construction on its 701-room RIU Montego Bay, citing a breach of building regulations. The hotel, which has been under construction for close to a year, had been scheduled to open Aug. 29.

The stop order stated that RIU had breached the law by constructing an unapproved fourth floor, which violated the three-floor building permit originally issued by the Parish Council of St. James, the parish in which Montego Bay is located. The order called for RIU to demolish the fourth floors on several buildings.

The three-story limit has long been on the books in that part of Montego Bay, because several hotels are close to Sangster Airport and fall within the flight path of aircraft landings and takeoffs. Any building above three stories is deemed an impediment to safe airport operations. Sangster and Norman Manley in Kingston are the two key airports in Jamaica.

The 65-acre RIU Montego Bay site overlooks Mahoe Bay, is adjacent to Sandals Royal Caribbean Resort & Private Island and is approximately three miles east of the airport.

RIU submitted one set of hotel development plans in March 2007 to build three four-story buildings, which the Parish Council and the National Environment and Planning Agency (NEPA) later rejected. A month later, RIU submitted revised plans to build seven beachfront buildings to comply with the permitted height regulations.

Approval for the hotel development plan had been signed and stamped on June 29, 2007, by Tubal Brown, superintendent of roads and works for the St. James Parish Council. However, it was later discovered that the necessary filing fees had not been collected and that the Parish Council had never officially approved that plan.

RIU claimed that when the building permit was collected on July 3, 2007, “the approved plans were not attached and RIU assumed that the plans approved were the final revised plans submitted by RIU in April 2007, rather than the earlier plans of March 2007.”

As construction commenced, someone started counting. A site inspection this month by a team of officials from the parish council discovered a fourth floor on three of the beachfront buildings.

RIU maintained that NEPA and the parish council had granted planning approvals. However, RIU then launched its own investigation and issued its second public statement in two weeks, as allegations of corruption and illegality began to surface.

“RIU denies absolutely that it was involved in any corrupt or illegal act as alleged. However, it regards these allegations so seriously that it is conducting an internal investigation,” the chain said in a statement.

RIU, the first of the Spanish hotel companies to make waves in Jamaica, opened the 416-room RIU Tropical Bay in Negril in March 2001, followed by the 420-room RIU Negril in 2004 and the 865-room RIU Ocho Rios in 2005. The four RIU properties in Jamaica represent a total investment of close to $400 million.