Business

Strachan: 'The days of secrecy are over' in financial services sector

July 23, 2015

Minister of Financial Services Hope Strachan yesterday stated that the "days of secrecy are over" in The Bahamas' financial services industry as the government steps in line with the United States' Foreign Account Tax Compliance Act (FATCA).
Speaking during the initial debate of the Bahamas and the United States of America Foreign Account Tax Compliance Agreement Bill, 2015 in the House of Assembly yesterday, Strachan stressed the need to combat The Bahamas' lingering image as a tax haven and comply with international reporting standards in order to preserve the integrity of the sector.
"I am confident that, like the work that we have done for FATCA that has brought us thus far, that we can and will meet our global obligations in 2018. We recognize that the days of secrecy are over. We also recognize that the world now demands transparency," Strachan said.
Minister of State for Finance Michael Halkitis joined Strachan in outlining the necessity of the legislation to meet international reporting requirements. Although members of the opposition supported the legislation, they argued that more needs to be done to stimulate growth in the sector to remain competitive.
The legislation seeks to help The Bahamas enforce the Model 1B Intergovernmental Agreement (IGA) signed on November 3, 2014 between the respective governments of the U.S. and The Bahamas to help implement FATCA provisions in The Bahamas' financial services sector. The act will only remain in force for the duration of the IGA.
The legislation's main objective is to grant powers to the financial secretary of the Ministry of Finance, known as the competent authority, enabling him or her to compile and report U.S. account holders' information to the U.S.' Internal Revenue Service (IRS).
Under the IGA, Bahamian financial institutions are required to register with the Internal Revenue Service, obtain a global intermediary identification number (GIIN) and report to the competent authority. Reporting Bahamas financial institutions include custodial and depository institutions, investment entities and specified insurance companies.
Financial institutions will be required to register on the government's Tax Information Exchange (TIE) Portal in July 31; the deadline for final submissions on the TIE Portal is August 17.
While Strachan acknowledged that compliance with U.S. tax law is far from the minds of most in the country, it is nonetheless vital for the continued existence of The Bahamas' financial services sector.
"We are not a tax haven and resent still being labeled as one by the European Union," she said.

Blacklisting
The specter of the European Union's (EU) tax blacklisting last month also weighed heavily on Strachan, with the minister reaffirming the government's commitment to overturning the EU's decision with the assistance of the Organization for Economic Cooperation and Development (OECD).
Strachan lamented that The Bahamas and wider Caribbean had largely been "tarred and feathered" by the EU blacklisting, particularly in light of The Bahamas' extensive tax information exchange agreements (TIEAs) and its adoption of the OECD's Standard for the Automatic Exchange of Information.
"This government will continue its ongoing efforts with the EU to have our name removed from the list. More comprehensively, we have already engaged our regulators, the OECD. They are the proper regulatory body for the EU as well as the countries blacklisted incorporating global forum standards applicable to all members across the board.
"They too have questioned the correctness of the list and the integrity of the process. It is in contradiction of the position of the OECD on many fronts," said Strachan.

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Baha Mar: CCA's motion to shorten 'reckless'

July 23, 2015

Baha Mar yesterday slammed the China Construction America (Bahamas) (CCA) motion to shorten the length of a suspension motion as a "reckless" course of action, stating that any such expedition would "unduly prejudice" the debtors and affiliated entities by forcing the debtors to rush proceedings as the gravity of a potential "complete shutdown" of the Chapter 11 cases under a greater motion to dismiss looms.
Baha Mar and its collective debtor entities filed for Chapter 11 bankruptcy in Delaware under Baha Mar's U.S.-registered entity Northshore Mainland Services Inc. The resort yesterday dismissed CCA's motion to shorten as well as its overarching motion to dismiss the Chapter 11 proceedings as "mere litigation tactics... aimed at diverting attention from [CCA's] liability and culpability".
"Indeed, CCA's repeated failures to perform as contractor are the subject of a lawsuit currently pending in the United Kingdom seeking over $150 million in damages, and have resulted in the debtors' liquidity issues, delayed openings of the resort and the current predicament before this court," read the objection.
CCA submitted a motion to shorten on Monday. That motion sought to fast track the U.S. bankruptcy court's hearing of another CCA motion to defer consideration of all pending matters before the court from August 17 to August 3. That motion would have deferred considerations of all matters relating to Baha Mar's Chapter 11 cases in the U.S. until the court had considered CCA's motion to dismiss the debtors' whole suite of cases on August 17.
However, U.S. Bankruptcy Judge Kevin Carey yesterday denied the motion to shorten.
Moreover, the debtors branded CCA's claim that an expedited hearing would save costs as "utterly disingenuous and without foundation", maintaining that any shortening would prove extremely costly for the debtors' estates, given the diverted resources from Baha Mar's ongoing negotiations with its contractor in Beijing.
"CCA's reckless course of action in seeking to have the suspension motion heard on shortened notice threatens to undermine, disrupt and divert critical resources from delicate negotiations currently taking place in Beijing, China aimed at resolving the primary dispute in these Chapter 11 cases and facilitating the opening of the resort.
"Rather than promoting 'efficiency', CCA's actions will punish and hurt employees, customers, critical vendors, brand partners, utilities, insurance providers and other innocent third parties, and cut off the debtors' final access to DIP [debtor-in-possession] financing, all in an effort to make it more likely that these Chapter 11 cases fail and the Court dismisses them," read the objection.
Regarding the far more pressing matter of a potential dismissal, Baha Mar counsel stated that it would object to CCA's dismissal motion "in due course".

The home front
Bahamian Supreme Court Justice Ian Winder's rejection of Baha Mar's application seeking approval for recognition in The Bahamas of orders issued by U.S. Judge Kevin Carey yesterday effectively rendered previous and subsequent rulings in Delaware's bankruptcy court impotent in The Bahamas.
In effect, this leaves Baha Mar exposed to claims from its hundreds of local and international creditors. Under U.S. Chapter 11 proceedings, the debtors would be shielded from creditors for a time to allow for restructuring.
Winder is expected to present his written reasons for the decision in two weeks, and will further consider the government's winding-up petition in a hearing scheduled for July 31.
That winding-up exercise would put the development under the control of government-appointed provisional liquidators, in this instance most likely from PricewaterhouseCoopers.
The government has acknowledged that it is closely monitoring the ongoing talks between Baha Mar and CCA and has labeled the winding-up petition as a "precautionary" measure. Should Baha Mar and its contractor reach an agreement, the developers will then have to hammer out the terms of further financing required to finish the project.

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Seymour: Six-month extension of HCA concessions more than adequate

July 23, 2015

The government's proposed six-month extension of the tax concessions offered to Freeport under the Hawksbill Creek Agreement (HCA) should prove "more than adequate" to conclude Freeport stakeholder consultations and draft a new model for taxation and economic development in Freeport, according to Grand Bahama Chamber of Commerce (GBCC) President Kevin Seymour.
Seymour yesterday told Guardian Business that the announcement was "not a surprise to anyone" in Freeport's business community given the fact that the Hawksbill Creek Agreement Review Committee (HCARC) had only submitted its findings to the government last month - just weeks before the tax concessions were set to expire on August 4.
"I believe that six months is more than adequate. With the circumstances we as a country find ourselves under regarding Baha Mar, I believe that the government initially is going to be preoccupied with that situation... but recognizing that they have to multitask, I imagine that six months will be more than enough time," he said.
Prime Minister Perry Christie yesterday stated that a pending six-month extension of the tax concessions and other benefits for Freeport under the HCA will encompass concessions on real property tax or levies, personal property tax or taxes on capital gains and appreciation, and taxes on the earnings of the Grand Bahama Port Authority (GBPA) or its licensees.
The prime minister said that the findings and recommendations of the committee and the government's various other consultants, including the long-withheld report produced by McKinsey & Co., remain before Cabinet.
"The imminent expiration of these concessions under the Hawksbill Creek Agreement has provided an opportunity for the government to secure a comprehensive set of new arrangements aimed at spurring economic development in Grand Bahama while at the same time increasing Grand Bahama's contribution to net fiscal receipts on a fairer and more equitable basis having regard to the interest of The Bahamas as a whole," said Christie.
"More time is clearly needed to complete this vital exercise. In due course, following the completion of Cabinet's deliberations, Parliament will be provided with the information contained in the study and the committee's report," he said.
Queen's Counsel and GBPA licensee Fred Smith commended the extension, but urged the government to go even further with a two-year consultation period to avoid further "rushing". Wider and more thorough discussions, Smith argued, are pivotal in realizing Freeport's potential as an industrial, tourism and maritime hub for the country.
"I congratulate the government for recognizing that they were rushing this process. The whole issue of Freeport's future is one which requires deliberation, consultation and transparency. Hopefully they will also reconsider their secrecy and refusal to publish the McKinsey report for people to consider... Six months is far too short. They started this process far too late," said Smith.

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Pioneering UK clinic opens up for business in The Bahamas

July 23, 2015

A UK clinic at the forefront of a treatment which uses gut bacteria from a healthy donor to treat patients with a broad range of conditions has set up an operation in The Bahamas in response to a growing demand from North America.
The Taymount Clinic, which has its headquarters in Hertfordshire, thirty minutes from London, has linked up with the Bahamas Medical Center, in Nassau, seizing on the demand for fecal microbiota transplants (FMT) from the United States, Canada and other parts of the world.
FMT is currently the most effective treatment available for clostridium difficile. However, many other countries including the UK and now The Bahamas are utilizing the procedure for a number of other conditions.
Many patients currently visit the Taymount Clinic in England to seek treatment for a range of gastrointestinal conditions, such as Crohn's disease and colitis as well as neurological and other problems.
The clinic is a global leading authority on FMT, which is the process of implanting the beneficial intestinal bacteria from a healthy donor into the gut of a person who is lacking the essential microflora they need for their gut to function properly.
Gerry Brennan, CEO of the Taymount Clinic, welcomed the partnership as an obvious step.
"We have a sizeable number of patients from the USA and Canada flying to London to be treated by us and it made perfect sense to find a location which was nearer home," he said.
"We are delighted to partner with the Bahamas Medical Center and this is an important development for the many thousands of people in North America, whose lives are blighted by their debilitating condition for whom FMT may prove effective," he added.
"We realize we had to do this for the good of many people suffering debilitating conditions who are being faced with difficult choices from mainstream medicine."
Staff at the Bahamas Medical Center have been trained to carry out the implants, with the first patient booked to be treated from August 24, with the center capable of seeing in excess of 40 people per day for FMT.
Barry Rassin, president of the Doctors Hospital Health System and Bahamas Medical Center, welcomed the opening of the Taymount Clinic in The Bahamas.
"There is a great demand for FMT and The Bahamas is easily accessible from the United States and Canada," he said.
"It is an innovative treatment that has helped many people and the wider medical community is beginning to appreciate the possible significant impact of FMT on a wide range of conditions. This program ties directly into the mission of Bahamas Medical Center, which includes a number of innovative treatments to assist patients to achieve a healthy lifestyle." He said.
"We at the Bahamas Medical Center are proud to be working with Taymount."
The Taymount Clinic is known internationally as a specialist center for the production of tested, certified, high quality gut bacteria and effective, efficient implant techniques.
The clinic provides FMT treatment to normalize gut bacteria in patients with Clostridium difficile infection, inflammatory bowel diseases (IBD) such as Crohn's disease and ulcerative colitis, post-antibiotic dysbiosis, food intolerance, multiple sclerosis and Parkinson's disease.

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New partner announced at HLB Galanis Co.

July 23, 2015

Nicholas A. Rees, the former accomplished Bahamian swimmer and two-time Olympian, has been named the newest partner of HLB Galanis & Co. by the firm's managing partner, Philip C. Galanis.
Nicholas is a highly skilled and qualified accountant certified by the Association of Chartered Certified Accountants (ACCA), which is the world's leading body for professional accountants. Nicholas is a graduate of Ohio State University, with a bachelor's degree in financial management and a minor in economics. He also holds a Master's of Business Administration from the University of Miami, having specialized in international business, with a certificate in management studies.
Nicholas has been practicing as a senior consultant and manager with the firm for the past three years, concentrating his consulting practice in corporate finance, business advisory and forensic audit services. He has over 10 years of professional experience ranging from small business startups and capital financing to securities, investments and financial services.
Nicholas joined HLB Galanis & Co. after serving as finance officer for the Bahamas International Securities Exchange (BISX), and the Bahamas Central Securities Depository (BCSD). He is also fluent in Spanish, which proves beneficial to the firm's international clientele.
Commenting on his admission to the partnership, Philip Galanis, managing partner commented: "Nicholas brings a tremendous depth of knowledge, experience and progressive vision to the firm as a young, highly intelligent certified accountant. His vast knowledge of capital markets, their regulatory framework, along with his extensive experience with developing and implementing policies and procedures has added tremendous value to our clients. I am extremely delighted to welcome Nicholas as a partner in the firm and we look forward to him expanding our vision as we enhance our professional service offerings in a wide range of sectors."
HLB Galanis & Co. was founded in 1998 by former Member of Parliament Philip C. Galanis and is a leading Bahamian-based accounting firm. The firm's motto, "Local in touch, global in reach" is indicative of its capabilities, and it provides excellent services to local clients, while simultaneously having the resources to extend its services internationally. The firm currently has offices in New Providence, Grand Bahama and the Turks and Caicos Islands.
HLB Galanis & Co. is a member of HLB International (HLBI), a global network of respected accounting and consulting firms. HLBI is a fast-growing, dynamic network of professional accounting firms and business advisers. Formed in 1969, HLBI services clients in over 100 countries, with more than 1,900 partners and a staff of 17,000 in over 500 offices around the world. HLBI is ranked 12th among global accounting firms, based on annual billings of $1.7 billion.

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Replay Resorts acquires Paradise Island condominium project

July 23, 2015

Replay Destinations (Bahamas) Ltd. has announced the acquisition of the majority of units in the former Ocean Place condominium development on Paradise Island.
"We could not be more pleased that after two years of work this acquisition for Replay is complete," said Michael Coyle, CEO of Replay Resorts. "The growing popularity of The Bahamas, the ease of access to Nassau, the amenities of Paradise Island and improving real estate market conditions position this project very well to meet the growing market demand for second homes in a location where the supply of similar homes is very limited now and into the future."
Bill Green, managing director of Replay Resorts, added "As the tallest purely residential building on Paradise Island the condominiums offer tremendous views in all directions -- over Nassau Harbour, across the Ocean Club Golf Course, and towards Atlantis. Being adjacent to Ocean Club with close proximity to the beach and Atlantis makes the location ideal for real estate buyers. There will never be another building like this on Paradise Island."
Of the building's 79 units, 27 are currently owned and 52 are unfinished. Replay Destinations (Bahamas) Ltd. has acquired all the unfinished units and is planning a major transformation and completion of the building. As part of its plan, Replay will be releasing a very limited number of condominiums for sale in the next month. Replay will be engaging with existing owners and members of the community very soon.
Replay Resorts is a fully integrated destination development company headquartered in Vancouver, Canada with a presence in the continental United States, Hawaii, Mexico and the Caribbean.

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Castrol Quote of the day: July 23, 2015
Castrol Quote of the day: July 23, 2015

July 23, 2015

Castrol Quote of the day: July 23, 2015

"Are you contemplating a full service
for your engine and can't afford it
right now? Then consider a simple
oil change with one of the superior
'Castrol' lubricants. But, bee sure to
to change sparks plugs, air
and fuel filters soon."

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Baha Mar says contractor is 'selfish'
Baha Mar says contractor is 'selfish'

July 23, 2015

IN documents filed in a US bankruptcy court yesterday, Baha Mar accused its general contractor China Construction America (CCA) of being "selfish" and using "litigation tactics" that can "punish and hurt" employees, brand partners, and other innocent third parties.

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Signing of Transition Services Agreement with PowerSecure for Management of The Bahamas Elelectricity Corporation
Signing of Transition Services Agreement with PowerSecure for Management of The Bahamas Elelectricity Corporation

July 22, 2015

The Government is very pleased to announce that today the country has taken another important step forward towards reducing the cost of electricity and increasing the reliability of power in the Bahamas with the signing of a transition services agreement...

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Bahamian Brewery Beverage invites you to Drink Pin!
Bahamian Brewery & Beverage invites you to Drink Pin!

July 22, 2015

Bahamian Brewery and Beverage is ready to heat up the summer with the release of their truly Bahamian Radler – the ‘Sands Pink Radler’. Sands premium lager mixed with all natural grapefruit juice is sure to be light, fruity...

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Grand Bahamians Scull the Boat and Win!
Grand Bahamians Scull the Boat and Win!

July 22, 2015

As Grand Bahama is the home of Bahamian Brewery and Beverage, the entire team was thrilled to participate in this year’s regatta as well as see the return of the sculling races at Taino Beach...

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CCA: Debtors do not have substantive U.S. connection

July 22, 2015

Supplementary evidence filed yesterday by China Construction America (CCA) Bahamas Ltd. in its bid to dismiss Baha Mar's Chapter 11 bankruptcy cases in the U.S. bankruptcy court of Delaware calls into question the legitimacy of Baha Mar's claims that it operates businesses and incurred expenses in the state of Florida.
The supplement to Exhibit D in CCA's motion contains a suite of declarations signed and sealed by Secretary of State of Florida Ken Detzner on July 20 stating that the records of the Florida Department of State do not disclose corporations by the name of the following entities "foreign or domestic, active or dissolved": Baha Mar Sales Company Ltd., Baha Mar Support Services Ltd., BMP Golf Ltd., BMP Three Ltd., Cable Beach Resorts Ltd., Riviera Golf Ventures Ltd., and BML Properties Ltd.
The supplement added to the previous Florida Department of State certifications filed on Monday pertaining to Baha Mar Enterprises Ltd., Baha Mar Entertainment Ltd., Baha Mar Land Holdings Ltd., Baha Mar Leasing Company Ltd., Baha Mar Ltd., Baha Mar Operating Company Ltd., and Baha Mar Properties Ltd.
Baha Mar's previous filings had indicated that the debtors had incurred "expenses for electricity, telephone, water, waste disposal, cable television, Internet, and other essential services... in the ordinary course of their businesses at Cable Beach, New Providence, The Bahamas and at offices located in Orlando and Miami, Florida."
According to a filing supporting the Baha Mar bankruptcy application in U.S. Bankruptcy Court in Delaware, Northshore Mainland Services Inc. (Northshore), the entity under which Baha Mar's developers collectively filed for U.S. bankruptcy protection, leases and manages call centers in Florida and New Jersey.
However, CCA's motion points out that the debtors listed only Bahamian utility providers. Furthermore, CCA charged that the only U.S. tax liability that the debtors alleged was a $100,000 sales and use tax owed to the Florida Department of Revenue.
"It is clear that none of the debtors have a connection with the United States such that the exercise of jurisdiction in the United States would be neither economic nor efficient. The debtors have failed to demonstrate that Northshore, despite being incorporated in Delaware, holds assets in or conducts substantive business in the United States: the company is licensed to do business in Florida but seems to have no office there, and it appears that it opened a New Jersey office for the sole purposes of this bankruptcy... Although these other debtors purport to have one collective office in Florida, none of them are authorized to do business in Florida," read the CCA motion.
CCA filed a motion to have Delaware's bankruptcy court dismiss with prejudice Northshore's application for Chapter 11 protection. The Bahamian Supreme Court is expected to make a decision today as to whether it will grant Baha Mar's application seeking authorization of those U.S. proceedings.

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More Baha Mar creditors file claims

July 22, 2015

Bahamas Waste Limited has filed a $11,601.21 claim against Baha Mar Properties Ltd. and a separate claim against Baha Mar Ltd. for $60,509.26. In addition, The Sign Man Co. Ltd. has filed four claims against Baha Mar Ltd. ranging from $17,250 to $121.50 for a combined value of roughly $30,000.
As of yesterday, just over 50 claims had been filed against the resort's developers. Last week, Northshore Mainland Services Inc., the Delaware-based company under which the Baha Mar group of companies filed for Chapter 11 bankruptcy protection, received a substantial $1.8 million claim from U.S. mechanical and electrical consulting engineering giant Jaros Baum & Bolles (JBB).
Baha Mar's top 20 creditors, which includes the Bahamas Electricity Corporation, contractors China Construction America (Bahamas), and construction firm Yates-Osprey, are collective owed approximately $120 million. Despite the considerable number of local creditors, no Bahamian companies are directly represented on Baha Mar's official committee of unsecured creditors.
That committee earlier issued a notice of appearance and demand for service of papers relating to Baha Mar's ongoing Chapter 11 cases and is scheduled to have its next meeting on August 3.
Yates-Osprey, a joint venture, is the closest thing to Bahamian representation on the committee. That firm yesterday filed a notice of appearance and request for service in Delaware's bankruptcy court.
Acting U.S. Trustee Andrew R. Vara last week appointed the following creditors to the committee: Yates-Osprey, Purchasing Solutions International Inc., Schadler Kramer Group, LLC. Dba SK&G, Suddath Global Logistics Bahamas, AECOM Technical Services, Terracon Consultants Inc., and SBE Hotel Management.
SBE, the operator of the SLS brand, brings a degree of representation for Baha Mar's brands.
However, neither of Baha Mar's two largest creditors - China Construction America and Bahamas Electricity Corporation- are represented on the committee.
The sway of firms within the unsecured creditors' committee typically hinges on the amount of money that they are owed and while the creditors committee's position will likely factor into any future action by the court, the bankruptcy trustee will ultimately decide on future matters involving the reimbursement of creditors.

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Sumner: Tripartite council can mediate in gratuities issue

July 22, 2015

Workers at the Melia Nassau Beach resort and the Bahamas Hotel Catering and Allied Workers Union (BHCAWU) should cease "running after crumbs" in the wake of the union's defeat in the Supreme Court over gratuities, according to Bahamas Chamber of Commerce and Employers Confederation (BCCEC) CEO Edison Sumner.
Sumner told Guardian Business that he had sent an appeal to BHCAWU heads urging them take advantage of the National Tripartite Council in resolving the final outstanding issue in the dispute: calculating the rate of distribution for held gratuities to the resort's line staff.
"Having gone through a lengthy court battle over this and spending a lot of money... you can bring that matter now to the tripartite council and allow the council to assist in mediating this stand-off and try to help them come to a resolution on this matter.
"I understand the issue about the gratuity, and that's fine, but you're running after crumbs when there's a whole bread on the table that you can go after," he said.
Sumner encouraged the union to put greater effort into improving the level of training and skills in the tourism industry's labor force to ultimately provide workers with a stronger case for demanding higher wages and better opportunities in the workplace.
"Let's spend more time getting our workforce to be better trained so they can be more productive, increasing their level of skills so that we can begin closing the skills gap that exists in the country," stated Sumner.
Melia executives and its workers had been locked in a protracted dispute over gratuities at the resort following the executives' decision to remove the automatically included 15 percent gratuities from its all-inclusive vacation packages.

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South Cat Cay developers hope to break ground in six weeks

July 22, 2015

The developers of a proposed $94 million hotel development on South Cat Cay hope to break ground within the next six weeks, paving the way for roughly 200 permanent jobs, according to Minister of State for Investments Khaalis Rolle.
Speaking with Guardian Business, Rolle said that the project would produce some 200 permanent positions and 150 construction jobs over the course of construction, once the government hammers out the terms of the project's heads of agreement with developers South Cat Cay Properties (Bahamas) Limited.
"We're currently negotiating the details of the heads of agreement for South Cat Cay. The developers are very excited and we look to break ground hopefully in another month to six weeks. We're just going through the final phases of the details and once that is completed we will go and do the groundbreaking ceremony.
Prime Minister Perry Christie announced during his 2015/2016 budget communication that the National Economic Council had granted approval in principle to South Cat Cay Properties (Bahamas) Limited for the development of the $94 million project, which ultimately aims to encompass a boutique hotel, a high-end residential development, and a marina on the small cay, near Bimini.
However, the project's developers were unavailable for comment up to press time.
Although the projected employment opportunities and more immediate construction jobs are good news for the tourism sector, concerns over successive administrations' dependency on the "anchor project" model of tourism - particularly for smaller Family Islands - has swelled amid the construction delays at Baha Mar.
Rolle candidly remarked last week that the government had "hard lessons" to learn in light of the present circumstances stalling the opening of the $3.5 billion Baha Mar project. The resort, long touted as the catalyst for the country's economic growth for the remainder of the year, is locked in a well-publicized dispute between its developers, Baha Mar Ltd., and general contractor, China Construction America (Bahamas).
Although Rolle believes that the size of the Baha Mar project or its one-phase approach were not directly responsible for its struggles, he suggested that the lessons learned from the project would influence the government's blueprint for future developments under the pending National Development Plan.
The possible impact of Baha Mar's delay on the economy, unemployment and The Bahamas' sovereign credit rating have sparked a clarion call for more feasible developments from members of the private sector and leaders of the Opposition.
With that in mind, Rolle stressed that South Cat Cay's developers and the government would adopt a more "pragmatic" approach to the development. Rolle did not speculate on when the developers expect to complete the project or whether they would employ a phased construction approach.
"We're going to try to take the most pragmatic approach based on the capacity of the developer and we need to be reasonable under the circumstances," said Rolle.

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Lowe: 30 percent drop in car sales for some BMDA members

July 22, 2015

A leading Bahamas Motor Dealers Association (BMDA) member has stated that the impact of value-added tax (VAT) and a glut of inventory at higher duty rates have presented a "major dilemma" for the auto industry, as BMDA members have suffered a 30 percent drop in new car sales for the first six months of the year.
Nassau Motor Company Limited (NMC) Director and Operations Managing Rick Lowe told Guardian Business that although myriad economic circumstances stacked the deck against the motor dealers industry, the impact of VAT could force some dealers into closure.
"There's an overall economic decline but the VAT is a major dilemma because it's basically increasing the price of vehicles by that amount of money. The duty reduction is a good thing but it's after the fact. Everybody's inventory, for the most part, is the higher duty rates," said Lowe.
Although Lowe welcomed a 10 percent cut in the duty rate as a "balancing effect" to compensate for VAT, the industry's burgeoning inventory imported at the previous rate - done under lengthy order cycles - meant that the industry would likely be unable to enjoy the benefits of the new duty rate for some time.
"It may just be balancing effect. Hopefully once we all sell the inventory at the higher duty rate - there may be loses on the way to sell them - but we may eventually get there, but who knows what will happen down the road?" said Lowe.
While the Christie administration's duty cuts were well received, Lowe lamented the growing burden of business license fees for the sector, noting that most motor dealers' fees jumped from 0.75 percent to 1.5 percent of gross sales. These fees, he said, amounted to more than BMDA members' recent net profits "in many cases".
"Now with Baha Mar in the mix it could potentially put a worse damper on things. Once consumer confidence is shot and investor confidence is shot it takes a while to recover," Lowe said, adding that lingering unemployment in the country continues to have a detrimental effect on sales.
With the country's economic recovery projections bleak at best for the rest of the year, Lowe expressed concern over the future of the industry as some dealers mull closure.
"[Closure] is certainly a last resort that we don't even want to think about in any serious way, but how long can you tread water? If regulations and taxes keep getting piled on, people have to make a determination, particularly if the majority of us are sustaining loses," stated Lowe.
To stimulate sluggish sales, Lowe said that NMC is paying VAT in some cases until the higher duty inventory is depleted, incurring a substantial cut to gross profit on vehicles.
And while Lowe said that the industry's outlook for the remainder of the year is uncertain, he noted that several BMDA members, including NMC and Bahamas Bus and Truck, had entered new markets for goods such as generators in a bid to make ends meet.
"We need to keep our back to the stone and keep pushing to make sure that this industry stays afloat," he said.

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One Cable Beach sales ahead of schedule

July 22, 2015

Sales of luxury beachfront condos in the iconic $45 million One Cable Beach development are exceeding expectation, with 40 percent of the residences sold prior to the pouring of the foundation, the project's developer said.
"The response to the offering of One Cable Beach has exceeded our projection," said Jason Kinsale, president and CEO of Aristo Development, which is funding and building the seven-story, 69-unit, ultra-luxurious condominium complex on Cable Beach. "I have been told - and we are trying to confirm - that the success we have enjoyed so far is unprecedented for this stage of a development and may be setting a record, with 40 percent of a residential project sold before the foundation is poured."
The project, which broke ground quietly without fanfare or a formal ceremony, has been humming along with hundreds of thousands of dollars of heavy equipment preparing the site and working on infrastructure. A sales office is open daily on the property west of Melia Nassau Beach resort and less than a half mile east of Sandals Royal Bahamian on Cable Beach.
The success to date, Kinsale believes, is due largely to location - the last available acreage in the sought-after Cable Beach area directly on the waterfront.
"I drove around for one year searching for a suitable piece of property," he admitted. When the purchase was complete, an abandoned house had to be demolished and hauled away. But the linear footage and the high elevation made the site ideal for construction. "When you come out here and see the sparkling turquoise waters, it takes your breath away, even mine, and I am accustomed to developing properties. I am supposed to think of it as business but I can't help but feel a little emotional when I walk this property so I understand how people, especially those coming from the northern U.S., Canada and Europe, would be struck by its beauty and want to buy.
"We do hope that as the building rises from the ground we will see more Bahamian sales. We have had a lot of interest from Bahamians and we expect to turn some of that interest into concrete sales to people who are either buying for themselves as a residence or recognize the value for investment purposes. Every sale we make we hear words like 'I know this is a smart investment'."
If location is part of the attraction, there is no question that the impressive design adds appeal. The architecture features a wave-like exterior in sharp white with extensive free-form balconies. The single building consists of nearly 70 residences ranging in price from $555,000 for a one-bedroom to $3 million for the 3,900-square-foot, 3-bedroom penthouse facing the sea. Residences have ocean or garden views and the property includes a swimming pool, fitness center, security, storm-rated windows and oversized doors, high ceilings, and quality construction with the finest in finishing details.
Aristo, which is also developing the popular residential community The Balmoral in New Providence, now has nearly $100 million in projects under construction on the island.

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ONE Cable Beach Sales Ahead of Schedule
ONE Cable Beach Sales Ahead of Schedule

July 22, 2015

Sales of luxury beachfront condos in the iconic $45 million ONE Cable Beach development are exceeding expectation with 40% of the residences sold prior to pouring of the foundation, the project’s developer said today...

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BREAKING NEWS: Judge refuses Baha Mar's application for Chapter 11 bankruptcy to be recognised in the Bahamas
BREAKING NEWS: Judge refuses Baha Mar's application for Chapter 11 bankruptcy to be recognised in the Bahamas

July 22, 2015

Justice Ian Winder has refused Baha Mar's application for Chapter 11 bankruptcy proceedings to be recognised and extented to the Bahamas' jurisdiction...

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Govt. Signs 10M Contract for New Aircraft
Govt. Signs $10M Contract for New Aircraft

July 21, 2015

After months of negotiations, the Bahamas Government, Monday, signed a $100 million contract with Avions de Transport Regional for the purchase of five ATR 600 model aircraft on behalf of Bahamasair, the country’s national airline...

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