At the Grand Bahama Business Outlook, a spotlight was shone on the question of investor relations when the vice chairman of the Grand Bahama Port Authority (GBPA) pointed out that - in words quoted from a banking legend - 'capital goes where it is welcome, and stays where it's well-treated.' Sarah St. George said she and her associates at the GBPA have been feeling "a bit like insects under a microscope for some considerable time," and she hinted very strongly that the right winds could blow and her partners out of Freeport.
Neither St. George nor Prime Minister Perry Christie referenced the Baha Mar debacle. Christie did, however, give public assurance that his government was "not in the business of acquiring people's shares or coercing the private sector to do anything." Despite the prime minister's assertion, the spectre of the defunct project looms over the discussion.
Developer Sarkis Izmirlian, supposedly desperate for a solution to terrible relations with his general contractor China Construction America, is reported to have asked the prime minister for help shortly before filing for bankruptcy in Delaware. Eventually, in a move that made headlines around the hospitality world, the government moved to liquidate the Bahamian Baha Mar companies, which scuttled the Delaware proceedings and opened the way for project financier China Export Import Bank to put the project in receivership. At present, the project is still in provisional liquidation, and the bank owns the assets.
Some characterized the government's attempts to force the issue to be litigated in The Bahamas as an attempted nationalization, a view Christie has dismissed. Still, amid contentious and vitriolic public spats between Izmirlian and the administration, many have expressed concern about the message sent to investors, both foreign and domestic, about what the government can and will do, given enough incentive.
Even the company hired by C.K Property Holdings - the Hutchison-owned holding company selling the Grand Lucayan Resort complex - commented on the affair when the sale was announced last week.
Stan Kozlowski of HVS Capital Corp. said, "Baha Mar has garnered so much negative resort news for the Bahamas recently. Unlike that situation, we see significantly more favorable economic investment opportunities for Grand Lucayan, no matter what options a potential buyer may consider."
St. George also confessed to feeling - she and the other GBPA members - "a bit like insects under a microscope for some considerable time."
"I can tell you, speaking as a St. George, I've had lots of advice. I've been on the receiving end of lots of recriminations, remonstrations and recommendations lately. Stay - Go! Build - Demolish! Be in the background! Be in the foreground!
"IN-vest, DI-vest, Wear a Vest - it can all be quite confusing. But one thing's for sure, we are doing our best. And we love Freeport. It's a privilege to be here still. But if the Good Lord says 'go forth' I can assure you, we won't be fifth..."
"When I was a banker on Wall St. at J.P Morgan, people quoted the words of Walter Wriston the scion of banking who said, capital goes where it is welcome, and stays where it's well-treated: you get the drift. He meant both financial and human capital. It applies to tourist and investor capital," she said.
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