Private sector development boom fails to materialize
Hyatt hotel site, Grand Cayman
(CNS Business): Progress on the private sector construction projects government is depending on to boost the local economy is thin on the ground as the PPM administration passes its halfway mark. From Frank Sound to George Town, government has touted a number of proposed developments by private sector investors that it is hoping will create jobs and inject cash into what is still a difficult economy, but with the exception of the Dart projects, none have laid down a single block.
As Dart continues to press ahead with its ongoing long-term planned projects the redevelopment of the former Hyatt and Treasure Island sites, plans for an ice-palace, the Beach Bay hotel and the much-anticipated Ironwood golf resort are still no further ahead than they were when the Progressives took office.
Like previous governments, the PPM government is depending heavily on private sector development to achieve its economic targets and to solve its ongoing unemployment problem. But so far, aside from the progress it is making on the airport development, the only other ground being dug up is that belonging to the Dart Group.
Treasure Island is back on the market at $15.4 million but negotiations are understood to be continuing with a possible buyer. Despite some problems with the building, realtors still believe that, given the location of the six-acre site in the heart of the Seven Mile Beach tourist zone, it has potential to boost development. Government estimates investment in the property will be in excess of $70 million and create much-needed jobs. However, with no signed deal on the table yet, this is unlikely to help the current administration before the end of its term in May 2017.
The long-awaited redevelopment of the former Hyatt hotel has also failed to advance. The site was destroyed during Hurricane Ivan eleven years ago and was at the centre of a protracted insurance wrangle in the courts for years before it was sold and cleared in preparation for redevelopment. However, since that work was undertaken some two years ago, the site has remained inactive.
The proposed Ice Palace development, which government implied would be a centre piece for its rejuvenation of the capital, also appears to be melting away as developers have not yet settled on a potential site for what many believe it’s an unlikely development for a Caribbean island.
The hotel in Beach Bay is said to be ready to break ground in January next year but the start date for this project has also been a moving target and there are no guarantees that work will begin at all next year. Investors behind the Ironwood golf resort in Frank Sound remain optimistic that they will be able to break ground before the end of this year if it strikes a deal with the government over the extension of the East-West arterial road, a deal breaker for the resort.
Government and the proposed developers have been in talks for well over 18 months but no deal has yet been signed. Given the auditor general’s recent findings over government’s previous deals with private sector developers, including the Shetty hospital and the so-called NRA/Dart deal, the current administration will now be unlikely to sign any closed-door deals with developers without bringing the proposal before the Legislative Assembly.
The dependence on successive administration on what have been termed ‘phantom projects’ is flawed, the former president of the Chamber of Commerce, Johann Moxam, recently told CNS Business.
He said that government had to address its dependency problem on “pie in the sky” proposed developments and that there were too many “proposed plans for proposed developments” that were cited as going to save Cayman but were nothing more than five-star fantasies.
Category: Construction, Economy, Local Business
