Pickering snag
Owen Arthur alleged recently that North Ridge Development had no money even for initial start-up expenses.
By Wade Gibbons | Sun, August 01, 2010 - 12:00 AM
THE MASSIVE PICKERING, St Lucy building project might not be getting off the ground any time soon.
That’s because developer North Ridge Development Company Limited has so far been unable to attract investors to raise capital for the proposed BDS$1.7 billion initiative.
Among the potential investors that the company has approached has been Cellate International & Construction Group [CICG], an Irish company now facing a lawsuit for misappropriation of funds in St Vincent and the Grenadines. This has resulted in CICG’s assets being frozen.
The company has a subsidiary, Cellate Caribbean, located at 1st Avenue, Belleville, St Michael.
At a ground-breaking ceremony in May, Prime Minister David Thompson said the project would include 1 161 residential units, a 200-unit hotel, a private day-care centre, a primary school, supermarkets, convenience stores and several other amenities.
The SUNDAY SUN has obtained a copy of a draft Memorandum of Understanding (MOU) which shows North Ridge has been seeking an investor to purchase a substantial percentage ownership interest; purchase up to $40 million non-voting redeemable preference shares; superintend the Pickering project; undertake construction of the proposed development; and source all additional funding required to complete construction and product sales.
The document also revealed North Ridge Development has outstanding financial obligations for the land purchase at Pickering, as well as to a number of professionals.
These include a cost of $24 million for about 230 acres of land, as well as payments to a surveyor, attorney-at-law, engineer, architect, financial/tax consultant, an environmental impact assessment team and other named individuals totalling $4.2 million.
North Ridge’s proposal to CICG to purchase a 30 per cent financial interest was priced at $16 million. Among other proposals put to CICG was that within 21 days of signing a MOU, $24 million of the $40 million was made available to close the land purchase. North Ridge proposed that the additional $16 million be placed in escrow to cover fees and other expenses.
On the cards was for CICG to receive a basic project management fee equal to three per cent of revenues and for North Ridge to receive a developer’s fee equal to five per cent of revenues.
CICG did not sign the agreement.
Two weeks ago former Prime Minister Owen Arthur suggested Government’s launch of the Pickering project was a façade. He alleged North Ridge Development had no money even for initial start-up expenses and had to borrow $600 000 to help pay pre-investment costs.
“These people do not have any money. They do not have any investors to work with them, but you had a groundbreaking ceremony in St Lucy to create the image that something is happening,” Arthur said.
In a July 27 statement to the SUNDAY SUN, the board of directors of North Ridge Development Company Limited said it was not appropriate “to respond to public statements on the status of investors”.
Efforts yesterday to reach North Ridge developers through their attorney-at-law Wayne Cumberbatch for further comment were futile.
lwadegibbons@nationnews.com
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Page 1 of 1 pages
This is typical DLP behaviour especially under the present leadership of the substantive Prime Minister——tell the people ‘things’ -create false hope and impressions. Impressions count more than facts sometimes. They cant fool me. One Term Government ? Definitely.
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Comment LinkThe Emperor wears no clothes?
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Comment LinkYou seem to be happy and bragging about the fact that the project will not be started anytime soon. I doubt P.M Thompson intended to mislead the people. If perchance the investor finds himself in a situation where his assets had to be frozen, is the P.M responsible for that? Can you tell us with certainty that the P.M had prior knowledge which he withheld?
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Comment LinkOwen some how feel he is the only black man in Barbados that should make any money.
Without first understanding how development projects can be financed, one would believe Owen’s perverted account as factual.
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Comment LinkThe people of Barbados should open their eyes now and see that this Government is only about show and tell, this is the first in many lies that will blow up in their face before we get this country back on track.
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Comment LinkLord have mercy! i thought that when Mr Arthur spoke on this issue that he was lambasted by the local developers, so now we find out that what he was saying is correct all along? why is it that this government is all about public relations? who mad person would go ahead and break ground when they don’t even have the money to purchase the very land the investment will be on?
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Comment LinkOk, so he never intended to mislead the country. Is this the same PM that said Clico was sound, prudent and well managed but still gave 10 million to it and within a month we heard that Clico’s statutory deficit is over 500 million and that it was in deep trouble? Or the said PM that said at the beginning of this month that he is leaves an economy that is sound and then the Governor gave a press conference in whcih we were told that all the foreign exchange earning sectors were down, the govenrment’s current account deficit has increased by 189 million, unemployment up, and the govenrment will not be recieving 300 000 000 it said it would be receiving from the World Bank? If the above two scenarios are not misleading, then the word ‘mislead’ means something else different in the dictionary!
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Comment LinkThis government is a total disgrace! This is absolutely embarrassing; I’m waiting to see the supports of this government defend this yet again misrepresentation of the real facts.
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Comment LinkThe whole thing seemed rather strange to me. The whole thing of spending money on construction when international financing has dried up seemed somewhat suspect. I was giving the government the benefit of the doubt though. The DLP turning out to be just like BLP.
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Comment LinkCould this be really true?
This is equivalent to if my father, who is alive and well, has promised me that I can have a plot of land which is titled to his aunt.
So based on this I hold a house warming party this weekend for my friends and family when I have no house plans, no mortgage or loan engagement and no actual title to said land.
They would send me to Jenkings, with good reason.
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Comment LinkI should have added that on behalf of the people of Barbados who are in DIRE need of housing, I wish Mr Arthur would come up with some viable options or proposals. It does not have to be Government only at the forefront of housing projects. Country first and a sure way for BLP to make some fround. People are desperate for somewhere decent to live.
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Comment LinkThis is more than a snag. How can you have a ground-breaking ceremony when you don’t even have the basic financing to buy the land? Hey… I just got an idea to build a large hotel at the north point and all I need is $40 million. Anybody want to invest with me as I’m about $40 million short? Can’t wait for your answer though as I’m off to my ground-breaking party. Got to go.
This government should face charges for “misappropriation of power”.
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Comment LinkThis present Government is totally useless. All they fill the people minds with lies, and thing that cannot be done. Look at the 4 seasons project every 4 months we are told it will start in the next 4 months, and things never happen. Now it’s the project in St. Lucy, and the port project. Just a lot of talk, with no money, and no monetary backers.
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