Brassington banks Marriott success on Jagdeo’s devious schemes

Mar 16, 2015 News

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– Feasibility study points to need for Crude oil, Deep Water Harbour, Brazil/Guyana road, Amaila first

Chairman of Atlantic Hotel Inc (AHI), Winston Brassington has announced that the Marriott Hotel will be opened come next month and that the projections for a successful rate of return on the multi-billion dollar investment will be realized, as projected in the Feasibility Study.
That study was conducted by HVS Consulting and Valuation out of Miami, Florida in the USA. Only a portion of it was released to the media.

However, that company, included in its projections that for the success of the Marriott Hotel, “we have assumed” that a portion of the nation’s ‘economic development initiatives’ need to be 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 Hotel feasible for the country, is the need for Guyana to find oil.
This is yet to happen and Venezuela has recently made threats against the ExxonMobil Offshore rig currently in the Stabroek Block, a move that follows that country’s navy seizing the research vessel of a previous operation which again stymied Guyana’s search for oil.
The nation’s economic development initiatives are outlined in the Feasibility Report’s Market Area Analysis Chapter. This, however, was not released to the media or the public.
HVS Consulting and Valuation was contacted for a complete copy of the Feasibility Study, but told this publication that it would need Brassington’s permission to release the full report.
Kaieteur News understands however,  that among the nation’s ‘Economic Development Initiatives’ to be realised, in addition to crude oil, is the establishment of a Deep Water Harbour, a road to Brazil, the expansion of the Cheddi Jagan International Airport (CJIA) and the Amaila Falls Hydro Electric Project.
The Executive Summary explicitly states: “we have assumed that the hotel will be affiliated with the Marriott brand and will open on March 1, 2014.”
The report also cautioned Brassington and the AHI team in a specially inserted section.
“Note: in the derivation of the our (sic) projections of occupancy and average rate for the greater competitive market and the subject hotel itself, the basis of financial projections, we have assumed that a portion of the economic development initiatives outlined within the Market Area Analysis Chapter (Chapter 3) of this report gain traction. Our projections are contingent upon this assumption.”
HVS Consulting and Valuation stated emphatically, that the projections are based on the assumption that the economic development initiatives are realized since March last year, none of which has happened.
When asked about revised projections in face of the setbacks, Brassington on Thursday, told reporters “they haven’t been revised and they don’t need to be revised.”
Brassington in fact went on to say the projections in Feasibility Studies—that he and other government officials have relied on over the years as proof as to why the project can be successful—”are actually one third of the projections.”
During his press conference at the still to be completed facility, Brassington told reporters that Marriott is also relying on another feasibility report.
This report however has not been made public, by AHI or Marriott International.
According to Brassington, “at this point there is nothing we are aware of that would adversely affect those projections.”
The statements of the NICIL head have attracted strong criticisms from the opposition, with APNU Shadow Finance Minister Carl Greenidge remarking that Brassington has banked the Marriott successes on the “devious schemes” of Former President Bharrat Jagdeo.
The hotel is projected to earn a rate of return of 8.9 per cent on the US$27M on the Syndicated Loan being sourced through Republic Bank Trinidad and Tobago that has to be repaid as a priority.
Whichever private investor places US$8M into the US$58M project, will take 67 percent ownership, earn a whopping 22 percent rate of return and be repaid as a second priority.
Brassington on Thursday announced that since a portion of the Republic Bank money has been held up along with the promised US$8M investment from ACE Investment INC, NICIL has since had to advance another US$16M to the project.
NICIL has already transferred US$15.4M to the project as a loan for which it earns zero per cent interest and, “will be repaid if cash flow enables.”
NICIL has also invested a further US$4M as equity in the Marriott Project.
According to Brassington, some US$52M has been spent on the Marriott Hotel so far, but all of the projections will be met, despite none of the Economic Developmental Initiatives becoming a reality as yet.
The Feasibility Study conducted by HVS Consulting and Valuation out of Miami, Florida in the USA had lambasted the nearby Pegasus Hotel for its purported substandard service.
It also labeled Princess International Hotel as unattractive, for a significant portion of the country’s business and Government travelers.

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