Rosewood: Baha Mar claimed to be landowner
Dallas-based Rosewood Hotels and Resorts International has filed a 420-page claim in a Delaware bankruptcy court saying its agreement to build a 200-room hotel at the Baha Mar resort in the Bahamas should be invalidated because developer Baha Mar Ltd. is in bankruptcy.
Baha Mar has not compensated Rosewood since the June 29 bankruptcy filing, the company claimed. Rosewood claims its brand has been “diminished” and “tarnished” because of its association with the project, which has hit one roadblock after another.
“Each day, Rosewood continued to incur costs and expenses for which it is not being compensated,” according to the company’s motion. “Rosewood is now suffering, and will suffer additional irreparable harm if it is not permitted to terminate the Rosewood Hotel Agreements and be relieved of its association with Baha Mar.”
Last month Bahamian Prime Minister Perry Christie announced he would seize control of the $3.5 billion development, which was to have opened in 2014, but remains unfinished; despite negotiations between the developer, Baha Mar Ltd., and the lender, China’s Export-Import Bank, construction has come to a halt on the development in Nassau, reported Reuters.
A license agreement dating back to July 2011 calls for Rosewood to manage one of five hotels, originally slated to open in 2014. In addition to the 200-room Rosewood, the project called for a 1,000-room Baha Mar Casino Resort & Hotel, a 707-room Grand Hyatt, a 300-room SLS Lux, and a 700-room Melia. Morgans Hotel Group and its Mondrian brand exited the project last year and was replaced by the SLS Lux.
In its claim, Rosewood also said Baha Mar misrepresented itself to the hospitality firm, saying it was the owner of the island resort property. “A preliminary search performed on August 14 reflected that Baha Mar did not own any real property,” said the motion. “Baha Mar cannot sell what it does not own, and thus cannot perform its core obligations to compensate Rosewood under the license agreement.”
Meanwhile, Christie said the office of the attorney general will begin liquidation proceedings to ensure the resort gets completed, reported GGRAsia. The project is expected to create about 5,000 new jobs and generate more than 10 percent of the Bahamas’ gross domestic product, Christie added.
“The completion of the Baha Mar resort is a matter of the utmost national importance,” Christie said. “Baha Mar must open.”
