Former gov’t passed title for Ogle land without agreed payment from developer
-AG calls for relinquishment, to ask for police probe
Two days before the March 2nd polls, the David Granger- led Cabinet approved the agreement for the sale of land at Ogle earmarked for an ambitious Caribbean Marketing Enterprises Inc. ( CMEI) hotels project and later issued an order for the transfer of the title although the company failed to meet agreed terms, including the submission of records for due diligence and a 50% down payment, a review has found.
As a result, Attorney General Anil Nandlall has said that police would be asked to investigate the sale for possible criminal conduct, while he is calling on the company to return the land to the state and reapply by sending an expression of interest.
The land, some 21,096 acres previously used for cane cultivation, was formerly owned by GuySuCo but subsequently vested in the government holding company, the National Industrial & Commercial Investments Ltd. (NICIL) through the Special Purpose Unit set up to dispose of the sugar company’s assets. An internal review that has been done by NICIL has since found that neither the government company nor CMEI fulfilled crucial obligations before, during and after the execution of the sale agreement.
“This one has some element of a process but clearly there was undue haste to pass the title over to the purchaser and you would look at the date when the Cabinet approval came and its proximity to the elections, as well as the fact that the vesting order, which constitutes title in law, was issued after APNU+AFC would have lost the election,” he told Stabroek News.
“Not even 10 percent of the sum was paid but possession is given and title passed. Worse yet, the agreement of sale expressly says that 50% of the sale price should have been paid as a deposit and that a series of works was supposed to have commenced, including the construction of a 180-room hotel within the first 18 months before
the issuance of the title,” he added.
For these reasons, among others, that Nandlall says that a police investigation has been launched and government wants the company to reapply if its investors are serious about the project.
“Those and many other
conditions are what Cabinet approved …in violation of its own Cabinet decision. The contract itself identifies these breaches as fundamental defects which qualifies for the contract to be terminated and the land goes back to the state. Of course, that is one remedy that will be
pursued but this file will also be transmitted to the police to investigate the possibility of criminal conduct,” he contended.
“We have made it very clear that we welcome investment but these
investments must be done in accordance with a settled, transparent process [where] everyone has a fair opportunity. We have said to them that genuine investors will be offered an opportunity to follow the process established and there investments will be welcomed, once it is examined and satisfies the relevant requirement. We are in the process of (inviting expressions) of interests for those very lands and they are free to resubmit their proposals… In my view, no decent company, having known the status of this government, that it is a caretaker government, should have proceeded with an investment of that magnitude. Then they accepted the vesting order after the elections after the world condemned that government,” he added.
Transfer of title
According to a project review undertaken by NICIL, the agreed sale price was listed as $632,880,000 but the company has only paid a paltry $20,845,000 and is still to submit a number of documents that should have determined criteria for approval. A down payment of 50% was due to be made, but as at June 15th, after the title was issued to the company, only $20,845,000 had been paid.
According to the agreement seen by this newspaper, “Ownership of the property will be vested in the name of the purchaser and publication of the vesting order in the official gazette, subject to, the covenants, encasements, servitude, obligations, rights, encumbrances, interests, restrictions, liabilities, stipulations, exemptions and reservations set forth herein. The vendor undertakes to use its best endeavours to have a vesting order published in the official gazette within three months of the date of the execution of this agreement.”
Records from NICIL seen by the Stabroek News shows that the company submitted a proposal for the lands on September 30th 2019 and due diligence began 13 days later.
A proposal for sale was submitted to the Board of NICIL on 23rd January 2020 and the Board approved the decision three days after.
The Execution of sale was done on February 17th, 2020 and Cabinet approved it on February 28th. The vesting order was however published months after during the stalemate over the elections results. By way of his powers under the Public Corporations Act, then Minister of Finance Winston Jordan made the June 11th, 2020 order for the conclusive transfer of the title.
Stabroek News attempted to contact US- based businessman Edmon Braithwaite, who is one of the principals of CMEI, but was told by a relative that he was not in the United States.
Braithwaite had in February of this year led a delegation of US businessmen here for the unveiling of a double hotel project, which he had said would include an AC Marriott.
It was during the turning of the sod for that project that NICIL had announced an ambitious ‘ City of Ogle’ project that would span 800 acres from Ogle to Lusignan and would include two other internationally-branded hotels, a specialty hospital in the form of a cardiology services centre and a housing development similar to the East Bank of Demerara Windsor Estates.
Jordan had boasted then about the company and said that the project would be model for local content execution and had compared it to the Marriott Hotel saying it would not be a burden to taxpayers.
“They [the CMEI group] truly have a commitment to this country. Everything you see here is the culmination of a group of Guyanese investors going out… It has been done right here… when you speak of local content, it is the epitome of local content …that is the model that will be followed by this government,” Jordan had said.
NICIL’s Privatisation Specialist Rachael Henry had informed that the land was sold at market value of over $26 million per acre.
She had also said that NICIL was satisfied with the due diligence carried out on the investors, and the NICIL team believed that the project would be realised within the next three years.
‘Trinuyana’
Nandall said that Trinidad and Tobagobased businessman John Aboud, who also had revealed plans to build at Ogle, would also have to reapply.
Aboud, of Amalgamated Security Services Limited, was the investor behind the Five Star US$75 million, 150-room hotel, which NICIL had said is expected to create about 400 jobs during its construction phase and some 200 permanent jobs when it is done.
“Trinuyana Investments Incorporated of Guyana recently signed an Agreement with the Nation to develop a world class, iconic, select service, internationally branded hotel-AC Marriott Hotel,” NICIL had said days before the CMEI announcement.
Then in Opposition, the PPP/C had welcomed the investment represented but criticized the secrecy with which the arrangement was negotiated.
“We welcome investment in hotels, we welcome investors to Guyana but what is surprising is the secrecy through which the whole arrangement or deal was struck,” then opposition leader Bharrat Jagdeo had said, while charging that the action showed that the APNU+AFC government is duplicitous.