The Chief Secretary of the Tobago House of Assembly (THA) Ancil Dennis has admitted that no feasibility study was done before the purchase of Manta Lodge or Sanctuary Villa. These two Tobago hotels have been left idle since their purchase in 2015.
Responding to questions posed by the Sunday Guardian, Dennis said, “While a feasibility study was not conducted, we were guided by the growing number of visitors seeking the dive experience.”
It has so far cost close to $40 million of taxpayers’ dollars to purchase and maintain the hotels which, to date, have not welcomed a single visitor and is instead the home to bats and rodents. The THA had originally revealed that the properties were purchased in 2015 for $32 million. The cost has now escalated by more than 20 per cent or $7.05 million as there has been ongoing payment for security and maintenance work since its purchase five years ago.
Chief Secretary Dennis indicated that both properties were purchased with the intent to increase the island’s hotel room stock to advance Tobago’s tourism thrust and stimulate economic growth.
He noted that Sanctuary Villa was envisaged to be an upscale, four-star hotel because of the need for such accommodation on the island. Dennis said that the quality/rating of Tobago’s room stock was and continues to be an issue when negotiating airlift to the island.
However, Dennis said that in 2015, several airlines from Tobago’s international source markets at the time were bringing people to the island for diving. Dennis added that he was happy to state that ‘diving’ is one of the core attractions offered by Tobago, noting that the island’s world-class dive product is often showcased and promoted to dive enthusiasts across the United Kingdom, Europe and elsewhere.
Dennis argued that this is why Manta Lodge was purchased then, below market price. He contended, “It was earmarked as a dive hotel because it catered to a fast-growing niche based on the trend of visitors to the island at the time.”
The hotel’s location in Speyside facilitated greater dive tourist engagement as a result of world-renowned attractions such as the largest brain coral located nearby, said Dennis.
According to the Chief Secretary, Manta Lodge also “had a very high occupancy rate then.”
‘Worst performing destination in the region’
…Manta Lodge’s previous owner: You had all these wonderful promises
This, however, is not what the previous owner of Manta Lodge, Sean Robinson told the Sunday Guardian.
He said, “Manta Lodge was built in 1995, and was profitable up to 2012/2013.” Robinson said that up until 2012, he had invested millions of dollars trying to keep the hotel going “because you had all these wonderful promises of more airlift and the marketing and the normal stories that you hear into 2020.”
Unfortunately, Robinson said that he went into receivership 2012 and Development Finance Ltd (DFL) held the property.
Robinson said, “After that, we went from running 65-70 per cent occupancy and you just saw it going down and down until you barely covering occupancy.”
According to Robinson, most properties in Tobago were in financial stress before COVID-19 came to our shores. He said many hotels in Tobago are currently for sale. “And worst yet, after this now, I would believe that unless you’re crazy, I can’t think of anybody that would buy a hotel in this industry.”
Although many properties are for sale, Robinson asserted that it would not make sense to purchase a hotel in this climate unless you are receiving the property for ten cents on the dollar.
Tobago, according to Robinson, has become the worst performing destination in the region. He said, “Actually, up until recently, the only place that was doing worse than Tobago was Haiti. Last year I think our arrivals was less than 30,000 people; 30,000 people can’t even joke towards keeping an industry going.”
Meanwhile, Dennis posited that the money spent on both hotels has not been misspent. “The properties are not a waste of taxpayers’ dollars but rather projects to be implemented. We plan to complete them for the purpose identified. This is of paramount importance to ensure that we advance Tobago’s tourism thrust.”
$8-10 Million More needed to fix Manta Lodge
Robinson said that it would cost at least another $8-10 million to refurbish Manta Lodge. According to Robinson, the structure of the hotel is sound, but every door, every bed would have to be replaced.
When asked if the THA made a good investment by purchasing the hotel from the development bank, Robinson said “the answer is yes and no because the property was in good condition when it was handed over” in 2015. “Now it has to be gutted.”
He said when the hotel was acquired, the tourism industry was on the decline and the prices of real estate were depressed. “So at $8 million they got a steal because you’re talking about a 20-bedroom hotel sitting down on an acre of prime land in Speyside, they got a steal.” Robinson said in 2006 the property was valued at $20 million.