The famed Atlantis Resort got a new owner two weeks ago. Kerzner International was struggling with debt since the economic downturn in 2008 and transferred ownership of the mega property to Brookfield Asset Management, a Canadian company.
Real estate transactions of this scale are complex. Brookfield was already a lender to the property and agreed to forgive many millions of dollars of debt in exchange for title. Kerzner, however, will remain as the management and operations team,insisting that the Atlantis property has always been profitable (it was other properties in the Kerzner portfolio that carried the debt). Kerzner, which also owns the Dubai Atlantis resort, worked for more than a year to resolve its debt issues. With Brookfield already invested in Atlantis Bahamas and Kerzner’s Palmilla Resort in Mexico, the debt for title exchange was a workable solution for both parties.
Resorts of this scale have a profound effect on the local economy. Atlantis Resort employs some 7000 people. A change in ownership could dramatically affect the future of the employees, so Prime Minister Ingraham became involved and made a statement. Although Brookefield has not specifically stated that jobs are guaranteed, all sides have stated they are committed to maintaining the work force and the high levels of service the resort is known for.
Brookefield is a global firm, with decades of expertise in real estate investment and holding billions in assets and a healthy cash flow. This is good news for us. It is not only jobs at stake, but the entire supply chain of Bahamian companies that profit from doing business with Atlantis. As the largest private employer in the country, there is a lot at stake. PM Ingraham noted in his statement last week that 15% of Bahamas jobs are related to Kerzner International.
Brookefield, to its credit, has stated that it has no plans to turn around and sell the property in the foreseeable future.