It now costs close to $40 million of taxpayers dollars to purchase and maintain two hotels in Tobago which, to date, have not welcomed a single visitor and is instead the home to bats and rodents.
The Tobago House of Assembly (THA) had originally revealed that the properties were purchased in 2015 for $32 million. The cost has now escalated by more than 20 per cent or $7.05 million as there has been ongoing payment for security and maintenance work since its purchase five years ago.
This was revealed through a Freedom of Information request. The Sunday Guardian received a copy of the document which shows that after the initial sum spent by the Tobago House of Assembly to buy Manta Lodge and Sanctuary Villa, fees are being paid for miscellaneous and security services.
Sanctuary Villa incurred a capital cost of $24 million and heaped up security costs of $2,003,074 over the last five years, with maintenance costs of $1,000,871 and other costs of $269,926. This includes $3.27 million in additional costs for Sanctuary Villa, bringing the real cost up to $27.27 million.
Manta Lodge originally cost $8 million and up to January 2020, an additional $1,623,327 had been forked out for security, $541,379 for maintenance and $1,616,708 in other costs, which totalled $3.78 million. This has taken the total cost of Manta Lodge up to $11.78 million.
The properties were bought when the present political leader of the Tobago Council of the PNM, Tracy Davidson-Celestine was the secretary for Tourism and Transportation. She is expected to lead the PNM into the upcoming THA polls next year as she seeks to be elected as the first female chief secretary of Tobago.
THA will be pouring more $$ into the hotels
On Friday the matter was brought to the Parliament as a motion on the adjournment of the House, and Tourism Minister Randall Mitchell revealed that the THA will be pouring even more money into the hotels as it plans to refurbish them.
“Madame Speaker, I am advised that the THA will soon begin the refurbishment and the completion of these two distressed properties and the plan is to place these properties into a special purpose company and look for the operators,” Mitchell told the Parliament.
He did not say how much more money is to be spent on the hotels, who are the operators or what type of operator the THA will be seeking. He also did not state the time frame for work to begin nor the date expected to welcome visitors.
However, sources in the office of the Chief Secretary told the Sunday Guardian that the intention is to refurbish the properties beginning with Manta Lodge in August, followed by Sanctuary in 2021.
The Sunday Guardian understands that the THA wants to have the properties managed and operated by UDECOTT until it can contract a reputable brand to operate the hotels.
Mitchell told the Parliament that the THA is not getting into the business of running hotels and noted that the most successful hotels in Trinidad were government-owned, including the Trinidad Hilton and the Hyatt (Regency).
He said international brands were now pursuing a strategy in which they do not build the plant but simply operate the hotels.
Mitchell said, “Just as the Government in Trinidad sourced the operator for the Magdalena Hotel, Apple leisure group, who were successful in that process, Madame Speaker. Because the model now is to find an operator who is vertically integrated, that can bring your guests from source, they have control of the airlift as well as bringing them and operating the hotel and taking them back home.”
He also announced that another hotel will be constructed on the sister isle.
“I am very happy to announce that the Government just granted some incentives for the construction of a hotel that will be branded under the Comfort Inn and Suites in Tobago.”
When contacted via email for comment on the matter, the office of the Secretary of Finance and the Economy, Joel Jack said, “We respectfully advise that any matter related to Tourism be directed to the Division of Tourism, Culture and Transportation for consideration.
“This, therefore, includes the use of funds to procure security, maintenance and other services at Sanctuary Resort and Manta Lodge.”
The SG also reached out to the Chief Secretary of the THA, Ancil Dennis via email and text message for comment on the payments to providers for the uninhabited/uninhabitable properties. Dennis is also the secretary of Tourism, Culture and Transportation. However, he did not respond.
Tobago economist Dr Vanus James said even though the two properties remain unused they need to be maintained and secured. He said, “They are holding them, they are not using them and they have to maintain them and secure them.”
James indicated that Manta Lodge is positioned on the beach. He opined that if the property is sitting across from the ocean, locked up and being exposed to the saltwater, it would go to “rack and ruin very quickly.”
“I don’t know of the specifics of what they have to do, but it makes sense to me that if they buy it and lock it up, just like it happened with Magdalena on the beach, the plant would deteriorate pretty rapidly.”
As the property is ocean-front, James said the Speyside investment would carry high maintenance costs especially if it is not being used or constantly exposed to the blast of the sea.
He said the fundamental question is: “Is this a good investment?”
James questioned why the building would be constructed without the consultation of the Government and then passed on to the Government because it is in a bad location.
James said he was not taken aback in light of the hotel’s (Manta Lodge) demise. He said, “I can’t imagine that you would build a hotel plant where it is built. It is in a very unattractive space and I am not surprised it has become a failed project, especially if you don’t have a plan with the Government to develop the industry in that environment, in that particular area.”
He said the Government took it over to rescue the investor and the end result is that it has a “white elephant” on its hand. According to James, “It was a bad investment.”
James said that if an impact is to be made in the tourism sector it cannot be done with the current amount of money that is allocated.
“What Government has been doing with the so called development budget is to respectively add it to the recurrent budget and fund consumption in Tobago, so that there is no wide, clear understanding of how to build a tourism product in Tobago.”
He emphasised that Tobago is coming last in the tourism market in the Caribbean region and it does not receive any foreign direct investment.
The failed purchase of the hotels is one of a litany of projects—including a canopy tours project and failure to recovery money lost in the Tobago Jazz festival—undertaken by the Tourism Division under Davidson-Celestine which have cost taxpayers millions of dollars with nothing to show.