Baha Mar is again facing setbacks as Rosewood Hotels & Resorts is seeking to drop out of the $3.5 billion resort and casino project in Nassau, Bahamas. Last Wednesday, the luxury hotel requested to pull its licensing agreement with the five-hotel complex.
Rosewood filled a legal document with a Delaware bankruptcy court to void plans for a 200-room hotel, effective immediately. The motion is based on a series of delays and impediments surrounding the developer of Baha Mar Ltd. The resort was supposed to open in December 2014. It subsequently missed announced openings in March, May and June of this year, to the dismay of guests who had already booked rooms.
The latest hindrance came in June, when Baha Mar filed for Chapter 11 bankruptcy. Chairman and CEO Sarkis Izmirlian claimed that filing for bankruptcy was the only way to work with creditors and re-secure financing of up to $80 million to continue paying workers, suppliers and vendors. Meanwhile, China Construction America alleged that Baha Mar owes contractors $140 million.
Rosewood Hotels & Resorts based its decision on the recent filings. The brand contends Baha Mar misstated that it remains the legal owner of the purchased property. It also cites Baha Mar’s limited access to funding and an inability to meet certain obligations under the Rosewood hotel agreement.
Baha Mar is in the process of fighting for recognition of its Chapter 11 filing. The Bahamian government initially opposed the motion, preventing the resort from moving forward. However, the court granted Baha Mar the ability to appeal its decision earlier this month.
Rosewood Hotels & Resorts is not the only group to withdraw from the embattled hotel complex. In 2014, Morgans Hotel Group yanked development of a 300-room property over a management dispute with Baha Mar Ltd. Current plans include Baja Mar Casino Resort & Spa with 1,000 guest rooms, a 707-room Grand Hyatt, a 300-room SLS Lux, a 694-room Melia Hotel. The Baha Mar project is the largest in the Bahamas to date.
