Robert FX Sillerman’s back! He may have told everybody that he has no talent in real estate. But, he sure has talent for dealing with the government of Anguilla . His team has recently put together a 30-page marketing presentation to persuade investors to take over the Flag Luxury Resort project in Anguilla . The presentation reveals that in July of this year he concluded a terrific deal with government. It brings him back in charge of Flag, and has breathed life into this failed project. He is using this presentation to invite new investors in the Flag project. The presentation tells us a number of things. For one thing, from the cover we learn that the new project will be called Temenos Resort, Anguilla .
1. Note the particularly disturbing news that we are now being described as “Anguilla , a British Protectorate”. The last British Protectorate I know about was Palestine
2. Page 3 reveals that it is really the same old project completely unchanged.
3. Page 4 indicates that the new investors will acquire $180 million of ‘first and second lien’ debt for $100 million. No doubt that is clear to our US
Most extraordinarily from the same page 4 we learn that the “owners” have recently concluded negotiations with government for “a 25 year bed tax concession” which we learn is worth $98 million over the same 25 years!! We knew about the tax concession, but now we learn the amount of the give away.
4. From page 8 it appears to be the same project. It is just being refinanced. With us giving them $98 million of public revenue to sweeten the deal! No question of one acre of land being refunded. I am glad we do not take responsibility for the golf course, as government was proposing at one time. But still . . . accommodation tax is supposed to be a major part of our revenue. Government has given up collecting it for 25 years. How are they going to pay their public servants and other obligations?
5. Page 15 reveals that delivery of the first Temenos villa will occur in the last quarter of 2009. Delivery of the last will be in the second quarter of 2010. The hotel will be completed and opened in the last quarter of 2010. So, it looks like full steam ahead. Just in time for the upcoming general elections.
There is one worry. Since the US economy is not expected to turn around until the last quarter of 2011, I am not sure who is going to come forward to make this happen.
6. Page 16 is quite revealing. It states that Mr Sillerman enjoys “a great deal of local support for the project”. I have no idea what local support he could be referring to. I rather thought that both Government and Opposition had publicly and repeatedly washed their hands of him.
Anybody remember the Chief Minister’s actual words the last time on the subject of Mr Sillerman?
Did you catch the bit at page 16 that Mr Sillerman has been granted permanent residence status in Anguilla ? The brochure claims this “is quite unusual for a non-native of the island”. That is surprising. I always thought that it was a precondition for being granted permanent residence status that you had to be a non-native. I was also under the mistaken impression that every foreigner who bought a flat or apartment was more or less automatically granted permanent residence status. Permanent residence status was invented by Ronald Webster back in 1980 as a convenience for every foreign home-owner not to be asked harassing questions by the youngsters of the Immigration Department when arriving in Anguilla to spend the winter. Each person who buys one of the villas will be entitled to apply for permanent residence status. Although, since government abused the status to additionally give citizenship rights, I hear they may be stopping it. Is Sillerman mamaguying me, or what?
7. Page 22 contains some vital figures. It calls itself “Key Financial Data”. From it, we learn that some $200 million has to be raised to bring this project to completion. We also learn that it will take the trivial figure of $40 million to buy out the existing lenders. Credit Suisse has obviously agreed to lie down and play dead in exchange for $40 million. Any takers?
It looks like the government of Anguilla was not joking when they announced a few months ago in the House of Assembly that they were thinking of ways to bail out this project. Have you any idea what US$98 million represents? That is more than a quarter of a billion EC dollars. Some bail out!
No doubt, this development will be presented as a major triumph for the party in power when the upcoming elections are announced. But, why have they been silent about the figures up to now?
Who said Mr Sillerman knew nothing about the real estate business?
Did Sillerman have anything to do with the "development" of Cap Jaluca? Did he ever own it? Both claims--which would be news to me--are made in the "Corporate Profile" document.
ReplyDeleteWho prepared this document? It is ludicrous on its face: who gives a "timeline" for a project's completion when the authors are soliciting funds to buy-out the present creditors? Presently, no one is in a position to finish--let alone sell--these properties.
Given the obviously unreliable nature of some of the representations, I would not assume that what it says regarding the GoA "concessions" is any more reliable (I am not saying that the government is not capable of giving away the store--again; I am just saying that I would not believe it just because it is so stated in this puffery).
Of course, even a broken clock is right twice a day. I think that this document evidences simply that some would-be salesmen are willing to say anything to anyone if they think that it will help them make a sale. I will bet you that Sillerman had nothing to do with the creation or dissemination of this document.
Once again disgusting behaviour from our GOA allowing Sillerman to take charge of Flag again.
ReplyDeleteWe must make it clear that our new government will not accept any of these terms to do with Flag or Sillerman. Any contract that this GOA makes with Flag or Sillerman will be null and void as soon as we have our new government.
Permanent residency for Sillerman can be rescinded and he can be asked to leave for agreeing to take our bed tax revenue for 25 years. What a disgrace our GOA is.
This give away to Flag sounds more serious than what happened in the Turks and Caicos. How can this government give $95 million away to a developer whilst going to the British for permission to borrow more. This government have taken us once again for fools also they have taken the British foriegn office for fools as well. The governor must now step in and take over until we have elections. If the governor was aware of this agreement with Flag then he must be bypassed and some one directly from the UK must come and stop this madness and declare the election immediately. Talk about causing unrest within Anguilla this agreement the government made with Flag and Sillerman is a disgrace and will cause massive unrest.
ReplyDeleteI can not believe that any Anguillians would have the nerve to ride over their fellow Anguillians this way. Governor, this is an absolutely lame duck government and no agreements with any developers that this government has made should be honored in any way.
This is worse than the TURKS and CAICOS and involves more give away monies.
Sillerman is full of it - the project has been left to rot for years and will take millions to get it back to where it was before all the workers left. Plus, he should move aside. After all it was Flag that screwed it up so what makes him think it will work this time and as for his schedule - ha ha.
ReplyDeleteHope the GOA made sure all monies owed previously by Flag was paid before any more work was started. The Chief Minister said on many occasions, all anguillians owed for work done at flag will be paid before any more work is started. HAS THIS BEEN DONE? HAVE ALL MONIES BEEN PAID? or was this just verbal diahrea.
ReplyDeleteThis so called agreement which is raping Anguilla of monies desperately needed should be scrapped. We have been taken yet again by our own. DIRTY POLITICS.
We expect to be taken by the developers from past practices but not by our own GOA.
All--I share your low expectations for the government, but--before you gallop off believing that the government failed you yet again--why should we believe anything stated in the papers that Don has posted? They are full of demonstrable misstatements, about: 1) Anguilla being a "British Protectorate"; 2) Sillerman's "unusual" status as a permanent resident; 3) that Sillerman developed and owned CJ, etc. Why should we believe anything else in this entirely misleading paper?
ReplyDeleteIs the Government willing and able to sell us down the river? Of course...has it done it in this transaction? Couldn't prove it by this document.
By the way, why is waiver of a "bed tax" (hardly a term that we use here) that attractive to developers? It is not a tax that would burden them now (unlike customs and duties, which--if waived--presently reduces construction costs). All waiver of a "bed tax" would do (from the developer's perspective) is make it (slightly) less expensive to house guests....that is not this project's present problem.
Don't believe everything (or even anything) that you read in an obviously unreliable sales document.
I agree with the first poster above, that this document seems like puffery written by a real estate salesman hoping to profit from these unfortunate circumstances, and that Sillerman may never have seen it.
ReplyDeleteThe other four posters reflect Hubert's view of a valid contract signed by the Government of Anguilla -- that a new government can "cancel" contracts made by a previous government. it would be the end of all foreign investment in Anguilla if investors were made to believe that agreements signed with Government were only valid until the next election. God help Anguilla if these unemployed children running for office are actually elected.
There are probably hundreds of current Anguilla Alien Land-Holders' Licensees who most definitely have *not* been granted "permanent resident" status, whatever *that* is, and have wallpapered their passports with six-month fiat-maximum-duration "Employment not permitted" stamps to prove it.
ReplyDeleteEssentially, ALHL holders are just being rented the right to use their own land, six months at a time.
My understanding is that after 14 years of another fiat-maximum 15 years *continuous* occupancy before an ALHL holder is eligible to apply for "belonger" status, the government, may, at its discretion, allow him/her "permanent residence" for the final year.
One hears about proposed constitutional changes where it'll be possible to actually get a *yearly* stamp, if you promise to never, ever, apply for belongerhood.
So, Don, I don't know what the problem is, here.
Mr. Sillerman just seems to have bought himself a *personal* tax-abatement, on top of all the others. Nothing new there, certainly.
And all the eventual Temenos land-holders, on the other hand, are free to join the rest of the ALHL holders at The Hotel Anguilla, which is sort of the opposite of the Hotel California. You can check out anytime you want, but you can never actually *arrive*...
Money goes to money.
ReplyDeleteSillerman is a very rich man and did not need to take anguilla to the cleaners.
Flag / Temenos will forever be like Viceroy, a stench to Anguilla.
What are we left with, Taxes which will no doubt go for the benefit of another developer or suchlike. Why can't we get the same treatment as Sillerman or Viceroy?
How can we stop these giveaways to foriegners?
As Hubert said in the house of assembly, the new government does not have to honor any agreement this government has made which is bad for Anguilla and that applies to taxes as well.
Lets hope that Chris Bryant or someone from the foriegn office reads this blog and takes much needed action with information on Flag and the agreements with our government.
ReplyDeleteThis government must not say they are broke and can not pay workers whist at the same time giving $98 million away to Flag or Sillerman, This must be looked in to.
The apologist for Sillerman above who suggests that Sillerman does not know anything about this prospectus must be on his Team. " I bet you Sillerman had nothing to do with the creation or desemination of this document." Really now? How much? And identify yourself!
ReplyDeleteI understand all sides taken in this discussion and can appreciate every persons feeling, thoughts and general attitude towards the project. There can be no doubt the many problems for Anguilla this project has casued. However, in the end, I think one goal of every Anguillian should be to see the completion of the Flag property into a revenue genreating hotel property.
ReplyDeleteThe fact the plan asks the GOA to give future revenues away is just that they are asking (not that the GOA is granting) and does not really make sense to a developer unless they will be used to finance the property. That is the concerning part.
At the end of the day, it is probably best to wait until after these elections to make any decisions regarding the Flag property - for both developer and GOA. Any speculation at this time is useless.
It would be great to see a mutaully beneficial solution soon for all parties concerned - developers, GOA, owners - remember there are owners whose money is invested in half finsished properties - and the people of Anguilla. I know it can be done, but the process must be open and transparent for all to see.
I wish you all the best towards finding a solution to this challenge.
From what i can see Flag will never generate any revenue for Anguilla. Any future revenue has already been given away to the developers or possible homeowners so why should Anguilla even think of any support for Flag.
ReplyDeleteDevelopers, homeowners should pay to be here or find somewhere else to plunder.
The $98 million give away?..... Let's not over complicate this. There is NO resort and therefore no collectable taxes (past or present) with the exception of duty concessions. 100% of nothing is 0.
ReplyDeleteN