Developers associated with a Ritz-Carlton-branded luxury project in Barbuda have agreed to advance as much as US$5 million to the Antigua and Barbuda government to help construct a new port on the island, Prime Minister Gaston Browne says.

Browne said the money would ultimately be credited toward lease payments connected to the development, making the arrangement an advance rather than a separate grant to the government.

Speaking Saturday on the Browne and Browne Show, the prime minister provided details of the financing while explaining why the government is moving cargo operations away from Barbuda’s existing port and constructing a larger facility at a new location.

Browne said the existing port is situated on a sandbank and was identified as vulnerable following Hurricane Irma in 2017.

“The reports that were done at the time indicated that we had to move the port,” Browne said. “It’s actually, the current one, it’s on a sandbank and could be easily washed away.”

The government subsequently identified a new location on Barbuda’s south coast, east of the river.

“So we’re building a bigger and better port,” Browne said.

Luxury development and cargo port were a ‘mismatch’

Browne said relocating the cargo port also addresses concerns about having commercial port operations next to a luxury tourism and residential development.

According to the prime minister, Rosewood had previously been lined up as the luxury brand associated with the development but withdrew because of the proximity of the existing cargo port.

“Certainly it’s a mismatch, and that is why Rosewood pulled out initially,” Browne said.

“They had Rosewood confirmed as a brand. And Rosewood indicated to them that they do not want a luxury brand next to a cargo port.”

Browne said the developers subsequently negotiated with Ritz-Carlton.

“They have since negotiated with Ritz-Carlton,” he said.

It was in that context, Browne said, that the developers agreed to provide financing to assist the government with construction of the replacement port.

Up to US$5 million

Browne said the developers agreed to advance as much as US$5 million.

“What they did, they advanced $5 million U.S.,” Browne initially said before qualifying the statement.

“I’m not sure they gave all of it as yet, but they’ve agreed to advance as much as $5 million U.S. dollars to the government,” he said.

The prime minister said the money is intended to assist with development of the new port.

“To help them to build out this new port,” Browne said.

He further explained that the money would be treated as an advance against future lease obligations associated with the development.

“That will go towards lease payments on the whole facility,” he said.

Browne’s qualification is significant: while he said the developers have agreed to advance up to US$5 million, he did not confirm that the entire US$5 million has already been transferred to the government.

New port to handle container traffic

The new port is being developed on approximately six acres on Barbuda’s south coast.

Browne said the location was selected in part because of the bedrock and water depth, although some dredging would still be required.

“The site where we’re about to build this new port is the best site now in terms of the bedrock,” Browne said.

He said the facility would be capable of accommodating container traffic directly.

“So ships with containers can now travel directly to Barbuda instead of having a situation in which they come to Antigua, then they have to offload and then transship to Barbuda,” Browne said.

The new facility will also include a public marina, according to the prime minister.

Browne said direct container shipments could help reduce some of the additional costs associated with moving building materials, consumer goods and fuel from Antigua to Barbuda.

He also expects the marina and port to stimulate additional business activity, particularly around the yachting sector.

Existing port to become part of development

Browne said the existing port area will no longer function as Barbuda’s principal cargo facility once the new port is operational.

Instead, he said, the old port will become part of the luxury development, with a smaller marina catering to homeowners and their boats.

“The old port facility now will form part of the Murby development,” Browne said. “They will do a small marina there for the boats, the homeowners who have their boats.”

He said luxury residences and a commercial cargo port were incompatible uses for the same immediate area, which contributed to the decision to separate the operations.

The government’s plan therefore involves relocating commercial port activity to the new six-acre site while allowing the existing waterfront location to be incorporated into the luxury development.

Browne said the developers’ contribution toward construction of the replacement port would eventually be offset against their lease payments.

The prime minister did not provide the total construction cost for the new port or specify how much of the agreed US$5 million maximum advance has already been paid.

“I’m not sure they gave all of it as yet,” Browne said, “but they’ve agreed to advance as much as $5 million U.S. dollars to the government.”

This article was originally published by Antigua News Room. Read the original article here: Ritz-Carlton-Linked Development Agrees to Advance Up to US$5 Million Toward New Barbuda Port, PM Says.