San Juan (AP) – U.S. casino operator Harrah’s Entertainment Inc. has announced that it has pulled out of a six-hotel resort proposal in the Bahamas worth more than USD 2 billion because it has taken too long to organize.
Harrah’s had agreed to team up with developer Baha Mar Resorts Ltd. and Starwood Hotels & Resorts Worldwide (HOT) to create the mega-resort along Nassau’s famed Cable Beach. But the U.S. casino company said Monday that plans for the ambitious complex have stalled.
„Unfortunately, it has taken Baha Mar Development Company longer to organize the project than anticipated and circumstances have changed such that it is simply not prudent to move forward,“ Harrah’s said in a statement e-mailed Monday. It did not disclose specifics.
The mixed-use resort, planned for a 1,000-acre (405-hectare) beachfront site that included an investment of more than USD 2 billion in its initial phase, was expected to have a work force of 10,000 people upon its completion in 2011.
Baha Mar Resorts asserted that Harrah’s withdrawal from the deal was a breach of faith. The development company said it was committed to moving forward with the resort project and challenged Harrah’s ability to „unilaterally terminate the arrangements.“
„We hope they will reconsider their action before they cause harm to both Baha Mar and the Bahamas,“ Baha Mar Resorts said in a Monday statement.
Baha Mar last year formed a joint venture with Harrah’s, and the companies signed a deal with Starwood to manage the complex. Plans called for the resort to feature the Caesar’s Resort Hotel, the St. Regis, the Westin Hotel, W, the Sheraton Hotel and a renovated Windham Nassau Resort.
The joint venture called for 57% to be owned by Baha Mar Resorts and 43% by a Harrah’s unit, effective upon confirmation by the Bahamian government of certain required approvals and concessions.
Bahamian government officials and Starwood did not immediately return calls for comment.
Obie Ferguson, chief of the Bahamas Hotel Managerial Association, which represents 200 middle managers on the Baha Mar parcels, said Harrah’s departure would likely be a blow for the local economy. He said little visible work had started at the work site.
„We were of the view that the project was going as scheduled,“ Ferguson said during a phone interview from the Bahamian capital of Nassau. „This will definitely have an impact on our work force, and I’m getting many calls from people trying to figure out what is happening here.“