Submitted by W. Lorimer
Lest we forget some of the reasons for this project…
Me thinks that people have perhaps become a little too bogged down in the trees of politics and grandstanding and everyone is tired from looking at this too long to see the forest – hopefully this might refresh people’s memories of why this journey began in the first place.
Why has the project taken so long to restart?
Why should the NIS invest?
Why would the Four Seasons project be good for Barbados?
Why does Barbados need Four Seasons?
Did you know…?
1. Four Seasons predict that this will be one of their premier resorts – great kudos to Barbados
2. Four Seasons themselves are investing in the project as a sign of their belief in the project and Barbados – they usually never invest in the development stages of resorts.
3. In the US alone in 2011, over $137 billion was spent on travel and one of the fastest areas of recovery in this sector is luxury travel so the sooner the Four Seasons project is up and running, the sooner Barbados will be able to tap into this market.
4. The new company, Paradise Beach Limited have put into place the following social initiatives
a. Work experience with UWI students
i. Selected students taking the UWI masters course in construction have the opportunity to work with some of the top staff at PBL. These people have MBAs from international universities, have worked on globally recognised projects etc. again this is a phenomenal opportunity to tap into excellent, one-off resources
1. This is actually taking place
b. Skills transfer/Apprenticeship scheme
i. For pieces of work such as mechanical or electrical where there is a skill shortage on the island, if foreign companies are brought in then Paradise Beach have been talking to the government about an apprenticeship scheme so that in future Barbadians WILL have the necessary skills plus they will have actual experience having worked on one of the world’s top resorts
c. Giving back to the community – once construction starts the consultants, contractors and the staff of PBL have agreed that they will put back into the community through volunteer work – this may be in the form of painting an orphanage or building a playground. This social initiative was something that had to be included as part of tender bids.
5. The new management team worked without pay for over a year to get the project restarted and local creditors repaid
Why has the project taken so long to restart?
1. The IDB (Inter American Development Bank – the world’s largest development bank) has agreed to a US$90 million loan for the project – this money only comes after extensive audits and reports looking at everything from commercial viability, projected employment on the island, impact on the sea and wildlife, eco-friendly initiatives, developmental impact etc. They would not have agreed to the loan if they did not think this was both good for Barbados and the region and a financially sound project
a. http://en.wikipedia.org/wiki/Inter-American_Development_Bank
b. http://www.iadb.org/en/inter-american-development-bank,2837.html
2. The IDB also requested a report on the effect the project and completed hotel and villas would have on Small to Medium size businesses on the island. The potential trickle down was valued in the millions – from housekeepers to landscaping to local produce, entertainment, restaurants etc.
3. THE IDB and NIS have undertaken extensive due diligence to make sure that the risks are mitigated and the terms of investment as favourable as possible
a. To achieve this independent lawyers, accountants, engineers, surveyors and real estate specialists were appointed
4. Ensuring that the Barbadian workforce benefited from the project closed many investment doors. If Barbados would accept 1000 Chinese workers on site and no Bajans then there are definitely alternative investors
Why should the NIS invest?
1. One of the primary reasons that Paradise Beach Limited (PBL) have been looking at local investment is because they want to keep the money within Barbados and the Caribbean. How many large companies etc come here and then take the money and profits out of Barbados – by keeping the investment regionally local it will keep the money within the greater Caribbean economy
a. International Investors who were looking to invest in the project wanted concessions for 100% expatriate workforce during both construction and operation!
2. Barbados needs foreign currency – at the moment it’s foreign exchange reserves are in difficulty and since Barbados imports so many items it needs the forex to pay for these items
3. An IMF report that came out recently regarding NIS investment stated that the NIS continuing to invest in low yielding government bonds was not a good idea. In fact the IMF approved of the NIS investing in the Four Season’s project
a. “The IMF has not frowned upon the Four Seasons investment by the NIS, quite the opposite. The IMF is recommending the NIS diversify its assets more. Everyone would consider placing less than 2.0% of NIS investments in an investment that earns its returns from well-to-do tourists, not local tax-payers, is backed by the IDB – the world’s largest development bank – and Four Seasons – the number one hotel brand- and vetted by independent experts, as prudent diversification”
b. www.imf.org/
4. Additionally given both the restrictions on what the NIS can invest in and what is available for it to invest in – an investment in the Four Seasons project is probably one of the best things it can do. It can either continue to invest in low yielding government bonds and hope that tax revenues increase to pay them back or face default like Greece or based on recommendations from the IDB, Four Seasons, the IMF and one of the world’s leading economic brains – invest in the Four Seasons project.
a. The NIS needs to diversify away from government paper which can only be repaid by increased future taxes
b. There is great safety in investing with the world’s largest development bank and one of the world’s leading luxury hotel brands
i. http://www.tophotels.com/full-text-search/searchterm-Four+Seasons-1.html
ii. http://www.fivestaralliance.com/best-hotels/luxury-family-hotels
c. The project ensures strategic support of the Barbados tourism sector
d. The project helps to underpin pricing of other West coast development projects
Why would the Four Seasons project be good for Barbados?
1. At the height of construction over 1000 people will be employed
2. Once the hotel and villas are open there is potentially employment for 300 people
3. There are great opportunities for local and regional companies to showcase themselves to both some of the wealthiest people in the world but also to one of the top companies in the world
a. Imagine if you were a local artist and Simon Cowell decided to put some of your art in his villa?
b. Imagine if you produced local jams and marmalades and Four Seasons provided them with their breakfasts?
c. Four Seasons actively tried to promote local talent and produce – http://www.amazon.com/Four-Seasons-Story-Business-Philosophy/dp/1591842441/ref=ntt_at_ep_dpt_1
4. Four Seasons are also excellent employers and both train and value their staff more so than the majority of other similar companies. The opportunities for Barbadians to learn valuable skills and travel within Four Seasons to other hotels and resorts are immense.
5. Tourism on the island will benefit as a whole as 5 star skills are transferred to other hotels and restaurants over time.
Why does Barbados need Four Seasons?
1. Many visitors over the last 40 years have been repeat guests. Modern travellers do not often tend to visit the same location year after year which means that Barbados needs to reinvent itself or it will start to lose its competitive advantage
2. Barbados needs to attract a more diversified tourist from further afield than just the UK. Four Seasons provides global recognition and attracts guests from North America, Russia and further afield.
3. The Four Season’s brand is critical to selling the residential units. They have continued elsewhere, to sell Four Seasons branded residences through the recession. The type of person interested in buying this type of residential villa is interested to a large extent in the quality and services that the Four Season’s name promises.
The blogmaster invites you to join the discussion.