Dart Realty’s Chief Executive Officer Mark VanDevelde is the point man in negotiations involving one of the most far-reaching deals the Cayman Islands Government has ever entertained. The Journal discussed that deal and other matters concerning the Dart Group with VanDevelde over dinner at Camana Bay’s Abacus restaurant.
June 6th was good day for Mark VanDevelde. It was good because during a meeting earlier in the day, the Dart Group signed a letter of intent with a boutique US hotel brand to manage the former Courtyard Marriott hotel once the extensive renovation and expansion project is completed.
The day could have been great. However, after 18 months of tough negotiations, the ForCayman Investment Alliance mega deal with the Cayman Islands Government still hasn’t been finalised – meaning the hotel project and most of the other aspects of the deal – are still in a holding pattern.
VanDevelde is optimistic that the signing will occur very soon.
Less than a year after he graduated from college at Michigan State University in 1993, VanDevelde moved to the Cayman Islands as the Dart Group’s first employee here. Almost 19 years later as Dart’s chief executive officer, he knows big deals take time. In fact, it took about a decade from the time Ken Dart bought the West Indian Club property before construction on Camana Bay commenced. He also knows big deals cause controversy.
But VanDevelde believes what the Dart Group is doing on Grand Cayman is something special, and something that will be good for the country and its people. He’s spent half of his life in Cayman. He married a Caymanian in 2003 and he’s now Caymanian as well. He has a young daughter and a young son who were both born here. This is his home and he has no intentions of moving elsewhere. And like all Caymanians who love their country, VanDevelde wants what’s best for Cayman.
When it comes to restaurants, Cayman has always loved what’s new. When Abacus opened to become Camana Bay’s first restaurant back in May 2008, residents swarmed the place. With its alfresco dining options along Camana Bay’s Paseo, Abacus offered something that didn’t really exist elsewhere on Grand Cayman.
In addition, Abacus had the pedigree of its dynamic duo owners – Neil Bryington and Markus Mueri – who had already teamed up to create two other successful and popular restaurants, Smuggler’s Cove and Deckers, and had just opened up Prime.
Over time more new restaurants have opened in Camana Bay, and although residents swarmed to those restaurants when they opened as well, Abacus has maintained a loyal following.
For dinner this evening, Abacus started us off with Hendrick’s Cocktail – gin, tonic and a splash of St. Germain liqueur – along with soup: Tomato, sweet pepper and cucumber gazpacho, drizzled with extra virgin olive oil. It was still early June, but the combination was full-fledged summer, from the floral notes of the St. Germain to the cold soup. Dinner was off to a tasty start.
ForCayman Investment Alliance
The Cayman Islands Government and the Dart Group announced its proposed mega deal in June 2011, six months after it had begun the negotiating process. In its vastness, the deal is unlike anything ever attempted between the government and private sector. Among other things, the deal called for the closure, capping and remediation of the George Town Landfill; the establishment of a new solid waste management facility in Bodden Town; the closure of a section of West Bay Road; the extension of the Esterley Tibbetts Highway from Raleigh Quay to Batabano Road, with an offshoot feeder to Reverend Blackman Road; the widening and enhancement of Seven Mile Public Beach; the creation of a new public beach near Yacht Club Road; the swapping of several tracts of land in West Bay; and a variety of import duty and fee concessions for the Dart Group for the development of new hotels. From the onset, the deal would require Dart to pay more than US$100 million to fulfil its end of the contract, and that was before the costs of developing even one hotel on the long stretch of beach-front property it acquired from developer Stan Thomas in January 2011.
It wasn’t long after the deal was announced that protests started over various aspects of the deal, primarily the proposed closure of about three-quarters of a mile of West Bay Road and the establishment of a new solid waste management facility in Bodden Town. Somewhere along the line, some residents got the impression that the Dart Group was acquiring Seven Mile Public Beach as part of the deal; something that was never proposed.
Partially because of the public protests and political opposition, and partially because of its complexity, the deal became bogged down. Then in November 2011, the United Kingdom forced the Cayman Islands to sign the Framework for Fiscal Responsibility Agreement, which required an independent review of the value for money proposition of the deal, delaying the finalisation even longer.
To get some of the provisions of the overall deal moving, Dart signed an agreement with the National Roads Authority last December, allowing it to start work on a portion of the Esterley Tibbetts Highway extension. However, that agreement, too, was subject to the findings of an independent review.
The initial version of that review by PriceWaterhouseCoopers has now been completed.
One of the things the independent review recommended was that the specifics for the expansion of the Seven Mile Public Beach and creation of the new public beach should have been a part of the National Roads Authority agreement signed last December.
“We were trying to expedite the NRA agreement, and we really call it the NRA agreement because it was supposed to be everything roads related,” said VanDevelde. “But, when you look at the geographic area where the road move takes place, the [Public Beach] expansion and the new beach, geographically it’s logical that those are included, but they’re not roads related. So, they were excluded from [the NRA agreement].”
However, the PwC review thought the beach provisions were more related to the road closure, so it recommended they be included. As a result, those items will be taken out of the main deal agreement and added to the Roads Authority agreement by way of an addendum. Although VanDevelde was confident the independent review would show government gets value for money in the deal, the Dart Group doesn’t agree with all of its findings, particularly the way it deals with the appreciation in value of Dart’s land once the section of West Bay Road is closed.
“We have a fundamental disagreement with the methodology they have taken regarding the land uplift, but even considering their approach to take the uplift, they still found it to be value for money,” VanDevelde said. “But we put on record… that we fundamentally disagree with that being an approved methodology for the precedence that it sets.”
The fact that Dart’s land will indeed appreciate in value significantly is a point that has been made by several of those opposed to the deal and notably North Side MLA Ezzard Miller, who has publicly stated that the Dart Group gets much more value than the government out of the deal.
VanDevelde explained Dart’s rebuttal to Miller’s claims and to the findings of the PwC independent review.
“What we’re asking for is a road closure,” he said. “The Roads Law specifically addresses what a road closure involves. So [government] could close the road and it clearly identifies what the process is for that.”
The process to close a road is similar to getting a piece of property rezoned, VanDevelde said.
“[Let’s say] you bought a tract of land and you want to get it rezoned for hotel tourism; or you want to get a buffer changed; or you want to get a road to your property – any of which may increase the value of your property,” he said. “If you go to the Planning Department and say you want a rezone and you want planning permission to build a hotel, both of them may increase the value of your property, whether you do it or not.”
The process to rezone involves only submitting an application and paying the established fees “none of which have anything to do with… the hypothetical increase in value of your now hotel-zoned property”, said VanDevelde, adding that there is no precedent for landowners to pay government a portion of the hypothetical increase in value as consideration for the rezoning.
“It’s a form of property tax… that is unprecedented on the Island,” he said. “And that’s our… response to the independent review. Our protest paper states that is unprecedented and not lawful on the Island to do this. It’s not a sale of a piece of property that has a market value.”
In addition, VanDevelde said the question of value to Dart is irrelevant at the end of the day.
“The whole proposition is… is government getting good value for money – not is the counter party getting good value; is the counter party making a good deal? – that has nothing to do with it,” he said. “It’s… is government getting good value for money. So, if government is able to close a two-lane road and get a four-lane road, and $20 million in gives, a $100 million in assets and this, that, and the other, is that value for money? The independent review will say yes.”
VanDevelde said the Dart deal with government was the first contract that’s had to go through the independent review process after the Framework for Fiscal Responsibility was signed.
“It’s been a good exercise I think… time consuming and a bit costly, but kind of a pioneering exercise,” he said. “And as time consuming as it was, at Camana Bay we’ve pioneered a number of things… we were the first large scale development to do an [Environmental Impact Assessment]; we did a large scale traffic study for Camana Bay; and this being the first time you have this independent review of a large scale agreement. You could be cynical and say, ‘why do we always have to be… the guinea pig’, but the other side of it is that it’s good and it’s good for the country that they carry those [processes] out.
Although PwC’s independent review has not been made public yet, VanDevelde said he believes it will be.
“There’s an expectation that the majority of it will become public relatively soon and some of the commercially sensitive issues will probably be held off for some period of time, but eventually that will get out there as well,” he said. “That’s the expectation at least, and we’re comfortable with that.”
Abacus bills itself as offering contemporary Caribbean dining, which is a bit of a misnomer if you’re looking to classify the food. The menu items are certainly contemporary and this sort of food is being served elsewhere in the Caribbean, including in Cayman, but it’s not really Caribbean cuisine. Yes, Abacus offers an appetizer of delicious oxtail spring rolls, a decidedly Caribbean-inspired dish, and maybe you could say the rest of the menu was Caribbean fusion, but it’s probably more accurately described as Cayman fusion.
With more than 100 nationalities living and working in the Cayman Islands, Grand Cayman’s cuisine style tends to draw on many influences, as does that of Abacus. Looking at the Abacus menu, you’ll see words or terms like soy, ginger, hot and sour, sushi, wasabi and sashimi liberally splashed in the descriptions. If we’re talking fusion cuisine, those are obviously the ingredients and dishes of Asian influence.
But with another glance at the menu, you’ll see the words tortellini, ravioli, risotto, calamari and smoked mozzarella – Italian fusion, right?
Looking more closely at the menu, you’ll find influences from France, the US, Canada, India, South America and, yes, even the Caribbean. Ultimately it’s the blend of all these cultural influences, like Grand Cayman itself, that makes the menu at Abacus best described as Cayman fusion.
The varied influences were clearly evident in second and third courses served on this evening: The sesame-crusted ahi tuna with sunomono salad and wasabi sorbet definitely had an Asian influence, and it would be completely natural to see the pan-seared sea scallop wrapped in prosciutto, served with grilled asparagus and basil-Parmesan risotto, in an Italian restaurant in Milan.
Both dishes were excellent.
Paired with the tuna was Charles Smith ‘Kung Fu Girl’ Riesling from Washington State. Rieslings tend to pair well with Asian-style cuisine and, even though this was drier style of Riesling, it didn’t disappoint.
With the scallop, Mark West Pinot Noir from Sonoma Valley was served. This easy-drinking, inexpensive wine pairs well with a wide variety of foods, so it’s a perfect addition to the eclectic Abacus wine list. Sometimes it’s just good to have a wine that can complement your food and not overshadow it and Mark West fits that bill nicely.
Winning hearts and minds
It’s safe to say that Ken Dart has a thick skin. For more than a decade now, he’s been the brunt of spirited opposition in Cayman, but this hasn’t deterred from his vision. VanDevelde, on the other hand, takes things more to heart. He’s passionate about what Dart has done, is doing and wants to do in the future on Grand Cayman. He truly believes it will all be very good for the country and he’s quick to defend his employer.
VanDevelde recognises that a lot of the criticism originates in political camps. He’s held the belief for many years that over time, Dart’s actions on Grand Cayman will win over the majority of people, even if there still is a strong segment of opposition.
A recent online poll run in the Caymanian Compass showed that nearly 75 per cent of respondents thought the Dart Group was either good or great for the Cayman Islands.
“It was heartening to see… the poll that ran in the Compass; overwhelmingly positive in light of some understandably controversial issues associated with the FCIA agreement,” VanDevelde said. “If you took the same poll two years ago, I would argue it would probably have been even better. It’s comforting to know that when you have all of these issues that are of topical importance today, including some very sensitive issues like the road move and the landfill, and you still have overwhelming positive response. VanDevelde sometimes hears the complaints that Camana Bay is elitist, but he says people can go there and not have to spend a lot of money.
“You can buy a movie ticket, go into the bookstore, buy a yogurt,” he said. “They are not elitist stores.”
He acknowledges that Camana Bay does have some high-end jewellery and clothing stores, but said that when considering the overall product mix, there’s something that’s affordable for just about everyone. Beyond that, he pointed to the many public amenities – like the fountains on the Crescent and Paseo that have become very popular with children – that are free of charge, as well as many events that are free.
The Dart Group is also winning over perceptions as one of the top employers in Cayman, including almost 300 Caymanians.
“We are an employer of choice,” he said. “We treat our people well and it’s an exciting workplace. We have interesting things to do and when you’re looking at it from an employee perspective, we deliver a lot more than just a paycheck.”
Beyond that, VanDevelde said the Dart Group has touched thousands of lives in Cayman through its many charitable contributions and community projects. But despite all of positives, there’s always been some political resistance.
Although the Darts Group’s relationship with the People’s Progressive Movement hasn’t been antagonistic, it hasn’t been warm and fuzzy either.
The PPM hasn’t really come out against the proposed ForCayman Investment Alliance deal, but despite the obvious need for economic diversification and stimulus in Cayman over the past three years, it hasn’t come out in support of it either.
VanDevelde said Dart really wanted to discuss the deal with PPM members, but despite several attempts, they haven’t accepted the invitation.
“It’s been extremely disappointing,” he said. “We’ve reached out to [Alden McLaughlin], the leader of the opposition on a number of occasions; to [East End MLA] Arden McLean on a number of occasions.”
VanDevelde said that of all the PPM elected representatives, he has the best relationship with McLean, who he used to have lunch with regularly when the PPM was in power. After Dart signed the initial agreement on the ForCayman Investment Alliance, VanDevelde said he sent e-mails to both McLaughlin and McLean inviting them to a meeting to discuss details about the agreement and to answer any questions them might have had.
“Arden was very quick to respond,” he said. “It was during the Finance Committee meetings and he said, ‘Look, we have finance committee all week. I’ll get back in touch with you later in the week’. And he also clarified that I had the wrong e-mail address for Alden and he gave me the correct e-mail address and I immediately sent it to Alden. I’ve sent two additional e-mails to Alden and two additional ones to Arden and I haven’t heard a peep back from either of them.”
VanDevelde said he would still like to sit down with the PPM to discuss the deal.
“The leader of the opposition has gone on record… saying everything he’s seen Dart do, we’ve done extraordinarily well,” VanDevelde said. “And they’ve always been very cordial in meetings I’ve had with them when they were in power. But it’s been disappointing, in Arden’s case in particular, but I guess in extension of that to Alden as the leader… we hold ourselves out to answer any questions they may have, to address any issues they may have, to at least provide them with facts. If it gets down to a value exercise, to give them any opportunity to discuss the methodology, the numbers… we have it all, we’ve shared it with a lot of people, we’re very open about that because we know in our heart it’s a damn good deal for the government and the people.”
VanDevelde understands the politics and that if this deal is being done by the United Democratic Party government and it looks like it might be good, it’s difficult for the PPM to show strong support for it.
“To be fair… [the PPM] haven’t taken a strong position against any of it; it’s been hedging and it’s certainly more about an anti-UDP sentiment,” VanDevelde said, noting that the PPM is far from independent MLA Miller’s hard-line stance against the deal. “For that, I’m appreciate it. I understand that politics plays a role and we’re coming into an election year, but it’s just disappointing because I’m sure that the sensible people that they are, Ezzard excluded, if you really sat down and talked fact with them, that it would really resonate, and just the factual discussion would highlight the benefits. I’m not saying they would agree with every aspect of it, but when you look at it holistically, I think most people would agree it’s a good deal.”
One look at Abacus Executive Chef Ron Jacobson and you can tell he loves food; you don’t get his size – or my size for that matter – without loving food.
Originally from Calgary, Alberta, Canada, Jacobson first arrived in Cayman in 1993 – the same year as VanDevelde.
After stints at Cayman’s Hyatt Regency and Marriott Beach Resort, Jacobson left Cayman for a while before returning, this time to the Bryington/Mueri fold. After opening their Prime Churrascaria restaurant at Governors Square, Jacobson came over and opened Abacus.
Although there a nice salads on the Abacus menu, Jacobson’s style favours heartier dishes; oxtail in his spring rolls; risotto with his scallop; pastas and beef.
Our main course this evening featured spring rack of lamb with a black olive jus that gave the lamb a unique earthy richness. Served with local vegetable ratatouille and caramelised garlic mash, this was hearty continental cuisine for big appetites.
VanDevelde said the name of the hotel brand with which the Dart Group had signed the letter of intent wouldn’t be announced until the National Roads Authority amendment agreement was signed.
However, VanDevelde was willing to discuss some of the details of the new property, the redevelopment of which will involve extensive renovation of the existing structure, the addition of a new wing of hotel rooms and the construction of some condominiums that will be sold.
“We’re looking at something that will be 200 to 250 [rooms] and the brand we’ve selected is really in that kind of four-and-a-half-star range,” he said.
VanDevelde said the choice of brand was made for a variety of reasons, but customer service was a key element.
“We and the [Dart] family were heavily engaged in this process,” he said, adding that Ken Dart and his family went to stay – without letting people know who they were – in several of the brand’s hotels in the US.
“And our team… visited a number of their locations, even under the guise of someone else,” he said. “These guys are just absolutely fabulous on customer service. That’s what we felt we really needed. We didn’t want a cookie-cutter concept. We wanted something that was extremely high quality and something that is family friendly.”
VanDevelde said Grand Cayman would be the first hotel for the brand outside of the United States, but that he thinks it was the right choice.
“From a personality perspective, we’re very much aligned… and in terms of how we are in business systems and what we want to see happening with our product,” he said. “I think it’s really going to be a good fit for us. It’s really going to be a good fit for the Island and the property.”
Now that Dart will be in the hotel business, VanDevelde said the company is dedicated to identifying younger Caymanians to put in the new brand’s system right away, by sending them to work at one of their properties in the US.
“If we have a two-year build out, we want to get them in now, get them up there for two years, hope they come back and place them at mid-management role at the hotel when it opens and hopefully transition them into senior management,” he said. “We’ve got a few people that we’re working on right now.”
Provisions of the ForCayman Investment Alliance agreement give the Dart Group – or their assignees – concessions to incentivise future hotel development along the stretch of property they purchased from Stan Thomas.
“You could look at four hotels along that section there,” VanDevelde said. “There could be in excess of 1,000 keys.”
Closing the section of West Bay Road will give Cayman an opportunity to have something special on that property, including the development of hotels and condominiums set back farther from the beach and a series of public bike and jogging trails similar to South Beach.
“You could have entertainment facilities that really draw on a thousand keys that could be within walking distance… on nicely designed boardwalks and the like,” VanDevelde said. “It’s an unprecedented opportunity for the Island to have that concentration of that type of product there.”
VanDevelde said Ken Dart will approach development of the site with the same kind of care that Camana Bay has been given.
“Ken’s intention is, and he sees it as many of us see it, when you look at the long-term perspective of the Island, this is the last piece of Seven Mile Beach that will allow for that,” he said. “And he’s got the wherewithal to ensure he’d be a good steward of that land.”
VanDevelde said that when Ken Dart bought the Coral Caymanian site, the best way to maximise return on it would have been to build multi-storey condominiums on it.
“A lot of other developers have done it, no fault to themselves, but that’s not what Ken is interested in,” he said. “And when you look at the recurring revenue and the recurring benefit of a lodging customer, it’s extremely different than… a developer building [a high-end condo]. The front-end profit and stamp duty is there. The development cost gives back to the economy for that period of time. And then you might have people who come back once a month, or once a year. But the recurring benefit of that is not that great without a property tax structure that we’re definitely not in support of.”
VanDevelde said hotel lodging has a completely different impact on the economy because of the recurring nature of the revenues.
“The hotel tax, room tax, the supplies, the employment, utilities, all the trickle down,” he said. “The economic impact is dramatically different. So Ken sees that and says, long term, for the Island’s benefit, for Camana Bay’s benefit, we want to grow the Island and that’s what we need to preserve that property for. That’s not to say you wouldn’t want [some] condos and other ancillary entertainment-type of opportunities there as well, but it’s going to be preserved mostly for lodging.”
VanDevelde said he couldn’t say when additional lodging – past the first hotel – would be built, or by whom.
“The market is going to dictate when it comes,” he said. “The deal we have with government allows us to assign certain benefits – we may own the land, but if a large-scale developer comes in and wants to do a Four Seasons there, we could lease them the land and assign them certain benefits to be a catalyst for them to move forward with it.
“The ultimate goal is economic development and job creation, so it doesn’t have to come just by us. Our risk appetite may change; we may only want one hotel or two hotels; or our focus might be to develop a hotel at Camana Bay because of the investment at Camana Bay.”
However, if someone were to approach the Dart Group and want to build something that would fit into the overall concept of they think should go on the properties, VanDevelde said the Darts could lease, sell or joint venture with someone to build.
“So that’s why we structured it in a way that would really give us flexibility.”
VanDevelde said he thought there was room for Cayman’s other hotels and for Dart’s new hotel.
“When we spend our marketing dollars to grow the pie, it can benefit [the other hotels] as well,” he said, adding that all the hotels cater to slightly different market niches so hopefully they wouldn’t overstep one another too much.
“We’re not going to have the room count of the Westin or the Ritz and we’re not going to rely on the large-scale group business – that’s their playground, so we’re not going to compete with them in that regard. We’ll take group business, but it’s going to be much smaller,” he said.
As has been publicly announced by developer Michael Ryan, the Dart Group has invested in the North Sound Club, Cayman’s only 18-hole golf course.
“We’d been speaking with Mike for well over a year about a possible investment in what is now the North Sound Club,” he said. “It was becoming more and more important for us to secure golf.”
When Ryan had control of The Ritz-Carlton, his intentions were to combine the North Sound Club course with the Blue Tip course at The Ritz-Carlton and make it a private course.
“Now that we’re going to be in the hotel business, and as well as Camana Bay, that was concerning,” said VanDevelde. “And that raised [the need for golf] to a point where we got together with him and – he reached out to us actually – and had a number of conversations with him over the past year and a half about possibilities of working together on the golf. And we have made an investment in the North Sound Club and we’re working with him in that regard.”
VanDevelde said he wasn’t at liberty to discuss the equity make-up of the investment, but he did say a number of options existed going forward. One thing the Dart Group is adamant about; however, is keeping the course open to the public.
The Dart Group in the US also recently acquired the Grand Cypress Golf Resort outside of Orlando, Florida, which has, among other things, 45 holes of Jack Nicholas-designed golf.
“With the concentrated 45 holes in Orlando, which is kind of Golf Central, USA, there’s a lot of intellectual knowledge that we’ve inherited,” VanDevelde said. “And when we look to apply it, I think it will prove to be a significant benefit for the Island, as well as the course.”
There could even be opportunities for cross membership between Cayman and Grand Cypress, he said.
In the immediate future, the focus is on upgrading the North Sound Club.
“The group is working on an investment programme that would involve some painting, cleaning, refitting some of the bathrooms and some of the other areas,” VanDevelde said. “It won’t be a huge overhaul, but it will be noticeable and improve the state of the existing course. And we look forward to the next steps and looking at what else we could do, and what would we want to do with this. For those who are looking at memberships, I’d encourage them to feel free to do that and not have a fear of something going pear shaped.”
One of the most damaging public relations aspects of Dart’s deal with the government was the notion that Dart was going to own the Seven Mile Public Beach after it improves it.
VanDevelde said this was simply not true and that both of the beaches – the enhanced and enlarged Seven Mile Public Beach and the new one further to the north – would both be fantastic beaches, open to the public.
“It will be amazing,” he said. “The beach access and the expanded public beach facility will be outstanding and very user friendly.”
Closing West Bay Road along the stretch of Seven Mile Public Beach will allow for it to be widened significantly. Adjoining it to the east, and running all the way to the Esterley Tibbetts Highway, the Dart Group will develop a new public park that will have lots of amenities. VanDevelde said the Dart Group has learned a lot about developing parks in the Cayman Islands from all of the other parks it has created.
“We’ve learned a lot of lessons about what to do and not to do on the park side of things and it will be a really interesting challenge to have a beach with a park [together],” he said.
When it’s completed, VanDevelde said people will enjoy a better experience of being at Seven Mile Public Beach and the surrounding area, as well as when driving north towards West Bay.
“It will be an experience unlike anything on the Island right now,” he said.
As for the new beach, it was originally slated to go next to the Sundowner condominiums, but now it will go on the old Victoria House site.
“We made the decision to locate the new public beach on the southern half of the Victoria House site, which is an absolutely gorgeous piece of property,” VanDevelde said. “The difference is the [property near] Sundowner is a much shallower piece of property.”
The new beach is being created by adding up all the six-foot right of ways on the Dart lands along the stretch of road being closed. In exchange for the Dart Group retaining those rights of way as private property, it was to transfer to government an equal amount of land equal to the combined width of the rights of ways. VanDevelde said that figure came up to 72 feet, but in the end, the Dart Group would be providing a 100-foot section of beach for the new beach.
“It’ll have ample parking on the beach side and it’s just a beautiful piece of beach,” he said. “This is an $11 (million) or $12 million asset that will go right into government and right onto Government’s balance sheet forever more.”
If there were any dish served that evening that could truly be called contemporary Caribbean dining, it was dessert – Cayman Lime Mousse with pecan lace cookie, Lower Valley mango and berries. It was a riot on a plate to look at, and tasted very good.
It was served with chilled Canton ginger liqueur, which, at least for me, is better as a cocktail ingredient than straight up. Since our waitress had been so kind as to leave the bottle of Avalon Cab, we went back to drinking wine.
We popped into the kitchen to say hello to Chef Ron, and to compliment him on the meal.
For me, the tuna slightly edging the scallop as best dish of the night, but VanDevelde said the scallop was his favourite.
We returned to the table to finish our wine; we still had a couple more points to cover.
Much has been said about the overall value of the Dart deal to government. Three major parts of that value come in the form of infrastructure projects that will be funded by Dart, namely the Esterley Tibbetts Highway extension, the capping, and remediation of the George Town Landfill, and the creation of the new solid waste management facility in Bodden Town.
On top of that, The Dart Group is paying the government some $20 million in cash and swapping some land. In total, the government is getting US$141 million worth of value, VanDevelde said.
In return, other than closing the road, trading swapping land and facilitating the deal – things that don’t cost money – government will have to give up $62 million of future fee concessions, which require future development for redemption.
“Future fees that we would pay would be offset against this $62 million, so it’s not a debt, there’s no government obligation,” said VanDevelde. “It’s only if we continue to develop.”
VanDevelde said there was a $78 million net advantage to government on the deal, and that more importantly, the government was receiving over $100 million of direct assets that could go on its balance sheet.
“So when you look at their borrowing criteria or limitations, it’s $100 million of assets that clearly go on their balance sheet, against the $62 million of abatements, which we may get in the future if we continue to develop,” VanDevelde said, adding that there’s a similar advantage to government on the land swap.
“You’ve heard people talk about the government is giving all this land away etc, etc… but the gain to government right now, as per the agreement, is 368 acres net positive to government after all things are said and done,” he said.
There are also plenty of economic benefits that will be derived by the government and the people of the country when the Darts start full-fledge into the construction aspects of the main agreement. In addition to the elements of the main agreement and the hotel project, there’s also the residential portion of Camana Bay to start – 101 condominiums and 35 semi-detached or fully detached residential units in one phase alone.
“Of the nine big projects… it’s about $283 million of shovel ready projects, of which, in the next six months, we could get $50.1 million of direct investment in there and that would also involve 774 jobs within the next six months,” VanDevelde said. “Over the next three years, the activity would involve 770 to 1,000 jobs.
“So, that’s… the future for economic stimulus and job creation. I think it’s second to none in terms for what’s available on the island and these are all projects that are funded, ready to go at advance stages.”
VanDevelde said that as soon as the National Roads Authority addendum agreement is signed, contracts for Phase 2 of the road works will go out, with construction starting on both ends of the road to expedite completion.
“Those contracts are ready to go,” he said. “We’ve already bid them out, they’re just pending. There’s a lot of activity that can get off the ground very quickly.”
VanDevelde said the entire government has been involved with the negotiations.
“I’ve been working closely with Rolston Anglin and Mark Scotland, and also had meetings with Captain Eugene [Ebanks] and Mike Adam as well,” he said, referring to the addendum agreement.
“The main agreement has been reviewed by both parties’ legal department. So we just need to sign the addendum so we can focus attention on the [main agreement],” he said. “The hope is, the PwC final report as well as the signed addendum can go to Cabinet possibly [by the end of June] and that the FCIA agreement can be signed sometime [by mid-July]. We’re really pushing to get that done. There’s no real reason for it not to be done; it’s 95 per cent agreed.”
VanDevelde said the negotiations on the deal have been difficult.
“We’re 18 months in a negotiation that has had every member of the UDP around the table at varying times,” he said. “We met with the governor on several occasions, [and] the deputy governor. We met with Cabinet on a couple of occasions, including the attorney general. It’s been vetted through the legal department. Now you have PwC engaged with a terms of reference that has been agreed on.”
The goal has been to get the main agreement finalised in July, and get construction rolling the same month, VanDevelde said.
“The entire UDP group we’ve been working with have been fantastic,” he said. “I think they all get it… but they’ve been hard negotiators from the get-go.