$14.7bn Asset Manager Targets Ginn Project

Thursday May 22nd, 2014

A top US real estate/infrastructure investment firm with $14.7 billion in assets under management has been revealed as one of the groups exploring the potential purchase of the former Ginn project in Grand Bahama’s West End.

Franklyn Wilson disclosed the identity of the CIM Group to illustrate his argument that the Bahamas was “defying gravity” by its present lure for “some of the biggest names” in the US investor community.

“Right now, the Bahamas Real Estate is so hot,” he said. “There are some of the biggest names. Look at the people trying to buy South Ocean, Och-Ziff. The CIM Group from Washington and Los Angeles are looking at Ginn. These are some of the biggest names in the business.

“What else can the country do? When you get guys like these taking a look, it’s incredible. These are the biggest names in the business in North America.” Other sources had previously confirmed the CIM Group’s interest in the former Ginn project independent of Mr Wilson, with some optimistic that it might be making an initial offer imminently.

CIM Group has investments stretching from California on the US west coast to New York and Washington on the east coast. It also has investments in Florida and Mexico. Its website lists 18 different hotel assets, carrying brand such as Sheraton, Marriott and Holiday Inn, with at least two properties in Hollywood.

CIM’s CV also lists numerous office, residential and retail developments, plus a partnership with Cantor Fitzgerald that developed Cantor Commercial Real Estate, a real estate financing firm. Significantly, given the Bahamas’s interest in the field, it also has holdings in two renewable energy companies.

CIM’s areas of expertise certainly appear a reasonable fit with the former Ginn project, given it’s hotel and real estate components, and extensive infrastructure already in the ground at West End.

Khaalis Rolle, minister of state for investments, confirmed there was increasing interest in the former Ginn project in a recent interview. He said “There are two strong ones that I know of” conducting due diligence on the property.

Sources close to developments recently suggested that a $60-$80 million purchase price could be enough to snatch the two components that the $4.9 billion Gin Sur Mer project ended up being split into.

What would have been the core project is owned by Lubert-Adler, the Philadelphia-based investment bank that was Ginn’s financing partner.

It holds 280 acres that were earmarked as the site for the hotels and casino, and its landholdings also include key amenities such as the airport, marina and utilities.

Lubert-Adler also controls the Old Bahama Bay Resort, the golf course, the existing marina, commercial facilities such as the restaurants and retail, and associated operational facilities.

But a Credit Suisse-led lending syndicate took possession of the remaining 1,476 acres at the former Ginn sur mer project after Ginn Development Company defaulted on its $276 million loan.

It effectively inherited the real estate component of the Ginn project, and is looking to develop that in partnership with its own master planner, Replay Resorts.

Mr Wilson, meanwhile, said that the state of the Bahamian economy lay in the eye of the beholder. He added that the “phenomenal amount of activity” being generated by Baha Mar and Albany was making other potential investors sit up and take notice.

“The real, serious monied interests in America are saying that we’re defying gravity,” he said, referring to an investor he had shown around New Providence who was interested in acquiring a 1,200 square foot condo at Albany for $4 million.

“That’s defying gravity,” Mr Wilson added, recalling a baseball game he attended with “some of the biggest players in the investment community” in the US. Referring to Baltimore Ravens’ owner, Steve Bisciotti, who had “done a great job” in promoting the Baker’s Bay development, where he owns a home, Mr Wilson added: “When you have a guy with such credibility telling his friends about the Bahamas Real Estate, we’ve got to take advantage of this window.

“It doesn’t last forever. This is the time. These are the biggest names in America. The fact that Joe Lewis is the investor behind Albany is huge, and the fact Albany has been successful in the Bahamas is huge.”

He added: “I’m saying to everyone in this country, the private sector, that if we don’t do it now, the Bahamas, if we don’t do something to convert this into something, I don’t know what we blame or who we blame. I just think the wind is so strong at our backs.”

Mr Rolle expressed similar sentiments recently, “Over the next couple of months we have some good things. We have a couple of big announcements we are going to make in Exuma, and in Eleuthera a major, major transaction is going to take place.”

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