By Kim Smith, Executive Director of BEST – Bermuda Environmental Sustainability Taskforce
In mid-2021, the Bermuda Environmental Sustainability Taskforce was shown conceptual drawings for expanded development of the Fairmont Southampton resort. That plan is for a threefold increase in the number of residential units to be built over what was granted by Special Development Order in 2009, and would require a new or amended SDO to be granted by the Bermuda Government. The request will be to construct more than 350 residential units on the site, in blocks ranging from two to five5 storeys high.
BEST sees no justification for such an expansion and we cannot imagine a basis on which a threefold increase in the number of residential units could be supported. We would like to see the detailed data that supports a claim that this development is beneficial to Bermuda in the long term.
We would also like to hear more from the former Minister of Finance, Curtis Dickinson, about “past practices of Gencom that caused him concern”; concerns that were seemingly part of the reason he quit so abruptly in mid-February.
A quote from Mr Dickinson conveys some of his unease: “Given the Government’s current fiscal position, is it prudent to give future tax revenues to developers who by virtue of their own financial returns projections would already be projected to earn multiples of their invested capital? Even if changes to existing tourism incentives are warranted, perhaps the analysis should be completed first for the industry at large rather than predicated on a single request. Otherwise, the overall cost could be astounding, and without the analysis I am unsure if it will be worth the rush.”
Despite the concessions that will be — or have already been — extended by the Government to renovate and reopen the hotel, we have concerns that Gencom will claim the inability to secure the financing needed to complete those renovations and that they will apply for a new or amended SDO to build and sell off residential units to provide the financing. Does such a scenario seem to hold the hotel project to ransom?