Cara Hotels has leased the 53-room hotel attached to the National Academy of the Performing Arts (Napa).
According to a December 2018 Cabinet note about the deal, the company will pay some $390,000 per year to lease the Napa Hotel, payable in quarterly tranches.
The first payment is not expected until 2021.
Chief Executive Officer Shaun McGrath came into the country from Guyana on Monday night. While he did not want to discuss the financial aspects of the deal, which is still in the draft stages, he confirmed that his company has negotiated a seven-year tax break and duty-free concessions as part of the 10-year lease agreement.
“When all this is done and dusted, I will happily sit down and give you all the gory details but I cannot do it now. I have committed a certain amount but I know I may have to put more into that,” he said.
McGrath said while management of the hotel will be under the Cara umbrella, he and his business partner are formulating a new company to take over Napa hotel.
According to the Cabinet Note, a capital investment of some $1.6 million is needed to develop a walkway, upgrade the restaurant and bar, refurbish and upgrade the lobby and the transform one of the two restaurants into a conference room. Another $2.1 million is expected to be spent on fixtures and fittings and equipment.
McGrath said that while it might be surprising news to some, Government had been actively trying to outsource management of the Napa hotel for the past decade.
“We first sent in a tender about nine years ago and heard nothing. Nine years of silence. We sent notes to the former government asking about the status and we did not get a reply,” he said.
“We wrote successive ministers and we heard nothing. We could not understand how this hotel was sitting there, doing nothing. It was such a waste of a national asset that was just sitting there and doing nothing. I was floored.”
McGrath said the new request for proposals was issued in 2016 and he and eight others went on a site visit. He said when he received the call that he had won the tender, he asked for a chance to fully investigate the hotel.
“What was surprising was how good a condition the hotel was in. I was blown away by how well it had been maintained. Nothing deteriorates faster than a building that has not been used. But this was very well maintained,” he said.
He said while the hotel was in good condition, there are some structural issues that needed to be addressed almost immediately.
He said Cara Hotels took on the biggest chunk of the cost to upgrade the Napa hotel but Government is also expected to put up some cash.
McGrath and his team expect to take over the hotel next month but the matter is still before the lawyers.
“It is not like Hilton (Trinidad) or Hyatt (Regency). Once we set it up there is no Government involvement,” he said meaning that Cara Hotels will take full responsibility for maintaining the hotel.
McGrath has already met with designers and other contractors to take Napa forward but nothing can be done until the final contract is signed.
- by Renuka Singh