Brassington deafeningly silent on lands gifted to China Railway

May 04, 2014 News

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…still to come public on Marriott financing

Winston Brassington who sits as Executive Director of the National Industrial and Commercial Investments Limited (NICIL), a company that has been described by the political opposition as a rogue company, has been deafeningly silent on transactions which cost Guyanese billions.
The latest scandal involving Brassington and NICIL’s silence, involves a tract of land that it has given to China Railway Engineering Group.
Brassington has been evading the media ever since word of this deal was passed on to the media by Alliance For Change (AFC) Leader, Khemraj Ramjattan.

Ramjattan was at the time checking the Official Gazette to see if the amended 2014 Appropriation Bill was assented to  and published, but stumbled on the fact that NICIL has gifted a one-acre plot of Turkeyen land to China Railway Engineering Group.
China Railway is currently involved in the construction of a section of the Amaila Falls Access Road and was also considered as a key construction partner during discussions last year on the controversial Amaila Falls Hydro Project.
During a recent press conference Ramjattan said, “We have taken a look at the Official Gazette and we found a double transfer of lands at Turkeyen from the Guyana Lands and Surveys Commission to NICIL which is headed by Winston Brassington.”
The latest publication of the Official Gazette and it stated that one acre of land at Plantation Turkeyen, East Coast Demerara, as shown on a plan by D. Ramkarran, a sworn land surveyor dated June 18, 2013 and signed by the Minister of Finance, Dr. Ashni Singh on April 4, was transferred to NICIL.
“NICIL then transferred to China Railway Guyana Incorporated, a piece of land as the donor and the donee. There was no cost attached to the land transfer,” according to Ramjattan.
To date, efforts to contact Brassington to reveal details behind the deal have proven to be futile as he refuses to answer calls to his phone.
It is unclear why Brassington’s NICIL would have provided this land to China Railway, whether the land was publicly advertised for sale or if indeed any money was paid for the acre of prime property.
Brassington has also been deafeningly silent on the controversial US$58M Marriott Hotel currently under construction in Kingston, Georgetown.
Work is ongoing at the construction site for the Marriott Hotel in Kingston, Georgetown but it is unclear where the funding is coming from.
Kaieteur News has been attempting to make contact with the Chairman of Atlantic Hotels Inc (AHI) Brassington, almost every day since January 2, to no avail.
Brassington created AHI as a special purpose company to build the Hotel but to date there is only one shareholder in the company namely NICIL, which has already invested US$4M and loaned to the project US$15.5M.
Brassington at the end of last year had promised an update in the New Year but has since refused to answer any calls made to him from this publication.
Brassington, last year, had indicated that there would be financial closure with the Private Investor before the end of the year. This did not happen. The monies to be sourced through Republic Bank are yet to be secured but the project is still continuing.
Financial Closure with the private investor has also not been made public so it remains a mystery where the funding is coming from for the continued construction of this multi-billion dollar project.
The company that prepared the feasibility study had set the completion date for the end of March this year. This clearly was not achieved and Brassington continues to remain mum on the state of the negotiations with the private investor.
He has not publicly communicated any new timelines for the financial closure for US$39M still outstanding for the project.
Head of State, Donald Ramotar, in March also promised that the information would be made public shortly after but to date this has not become a reality. He also provided a completely new financing structure for the project.
Ramotar told media operatives during a press briefing at Office of the President on March 28 that “there is a lot of interest in Marriott from local banks that are here; we have local banks involved, we have also foreign banks involved and we do have a foreign investor.”
According to Brassington, the Chairman of the Special Purpose Company created to build and own the hotel, Atlantic Hotel Inc.; its construction comes through debt and equity.
NICIL was supposed to be investing US$4M and lending the project US$15.5M; Republic Bank Trinidad was asked to syndicate US$27M while a still to be named investor was to invest US$8M.
Brassington is also yet to provide answers as it relates to the proposals submitted by private persons or companies to run the casino and restaurant that will be a part of the Marriott Hotel.
The Guyana Government is, to date, the sole investor in the Georgetown Marriott Hotel given that AHI is yet to have financial closure for US$39M of the US$58.5M required for its completion.
Brassington, last September, held a special media briefing on the project. He told reporters that while the AHI would have executed a number of agreements with Republic Bank and the private investor, whom he is still to name, there is no definitive financial closure for the money as yet.
That still to be named private investor will own 67 per cent shares in the company while government will own 33 per cent. Republic Bank has been asked to solicit a total of US$31M, to be repaid at an interest rate of 8.9 per cent, while NICIL will be lending US$15.5M with zero per cent return.
According to the Feasibility Study undertaken for the project by a Miami based HVS Consulting and Valuation, the Senior Debt, solicited by Republic Bank will receive payment before the preferred equity, the NICIL equity, and the NICIL debt.
As it relates to the US$15.5M lent to the project by NICIL, this will be repaid, “when cash flows enable.”
Incidentally, five years after the Hotel begins its operations it will take on an additional loan of US$5M.
Repayment of this loan will also take priority over the NICIL’s loan.
The unnamed private investor scheduled to put in US$8M, in the Georgetown Marriott Hotel is expected to rake in approximately US$46M after 10 years.
This is documented in the extract of the feasibility report which was released to the media. According to reports, during the first three years of the hotel’s operation AHI will pay the still to be named private investor US$1.3M.
From year four of the hotel’s operation, the unnamed private investor will be paid US$1.2M each year for the next six years.
The feasibility study done for the Marriott Hotel has included in its projections for the success of the Marriott Hotel, that “we have assumed” that a portion of the nation’s economic development initiatives are realized.”
The report says, “These include but are not limited to, the cultivation of a portion of Guyana’s crude oil.”
This would mean that included in the factors that would make the Marriott feasible for the country is the need for Guyana to find oil.
This is yet to happen.

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