Former owner of John Silver’s Inn has said that contrary to a recent media report, the West Bay property was not bought for far more than its market value by the previous Government, but actually for what he believes to be less.
A Cayman Net News story from Monday 22 August outlines the current Government’s decision not to use the property as a hospitality training centre, as was proposed by the previous Government. The article points out that a consultant’s report deemed the property unsuitable.
‘The decision is based on numerous reasons from the purchase of the land for far more than its value . . .’ reads the article. However, former owner Mr. John Swanson disputes this.
The Government reportedly paid CI$607,791.04 for the property on 15 October 2003.
Mr. Swanson had bought the property from the Caribbean Development Bank for US$600,000 18 years ago, he said (putting down a $100,000 deposit). He originally bought the property with business partner Richard Welds, who he later bought out.
However, Mr. Swanson admitted that for the three or four years leading up to 2003, interest had escalated on the property because of missed mortgage payments and when the purchase by Government was signed, what was owed to the CDB could have been about US$700,000.
When the Government bought the property in 2003 the sum paid went to the CDB to pay the outstanding mortgage and avoid the continuation of interest.
Mr. Swanson received an ex-gratia payment for CI$50,000 from the Cayman Islands Government last year as a goodwill gesture for his investment in the property. Former Minister for Tourism McKeeva Bush said this week that Mr. Swanson had asked for more money, but $50,000 was what they came up with for him.
Mr. Swanson still believes he is owed money because he says he did not receive fair market value for his property or get his investment back in the sale, saying he invested $250,000 in the property. He had been assured he would be given a fair price, he said. He had put money into the property first of all to bring it up to standard to obtain a hotel licence and then for continual upgrades and maintenance, he said.
On 22 July 2002, Lands and Survey confirmed the Open Market Value of the property at CI$550,000. However, in 2002 an independent valuer had put the open market value at CI$796,000 and two other independent companies had valued it above this figure.
He questions how the Lands & Survey Department could have put a figure of $550,000 on the property, a quarter of a million lower than those independent companies.
Mr. Swanson questions another section in the Net News article that says, ‘Mr. (Charles) Clifford in his parliamentary presentation also revealed that at the time the Government also purchased the property, it was in the hands of the Caribbean Development Bank (CDB), which had repossessed it from a former owner because of a loan default.’
Mr. Swanson said, ‘Who is the former owner and I’d like to publicly challenge the CDB, the Government and the Net News to present to the public the documents relating to that re-possession they mention.’
He had missed some mortgage payments, but there had never been any talk of foreclosing on the property, he said. The property had not been earning money and this caused negotiations between himself and CDB over a two year period with a view to selling.
Mr. Clifford said the he stands by his parliamentary answer. The information contained in it was retrieved from Government files and is factual, he said.
Mr. Swanson also defended the fact that he and his family have been living there for the past 11 months because their house was completely destroyed during hurricane Ivan last September. The UDP Government had instructed the Lands & Survey to allow Mr. Swanson to continue to occupy the property after the Government had completed the purchase. Mr. Bush had asked him to keep the property open so it wouldn’t get vandalised, he said. Contrary to what was published in Net News, Richard Welds does not live on the property, he asserted.
Mr. Swanson defended his charging of rent to other tenants at the property. He said the rent from tenants is used to keep the property maintained on behalf of the Cayman Islands Government and that he does not get a management fee. The property earns $4,500 per month and this covers expenses such as electricity, water, landscaping, maid service, general maintenance, TV service and garbage fees. However, he said the place only filled up four months after the hurricane, and before that it was getting about $1,600 per month in rent, from the Government purchase date up to before the hurricane in September 2004.
Mr. Bush said it was a good thing Mr. Swanson had kept the property running because it was now in very good condition. Mr. Bush said this was the year his Government had planned to get something done with the hospitality school.
‘They’ve made a great mistake,’ he said, referring to the Government’s decision not to use the site for a hospitality school.
‘Our country is a tourist destination and we wanted a dedicated school for hospitality training. This was all explained in Finance Committee and in the House and in the media. We wanted to have a dedicated place where students could learn because it’s important for tourism that children can try to start to work in that direction.’
He was speaking last week while away on medical business with his wife and his mother.
The Government will now consider alternative uses for the John Silver’s property, said Minister for Tourism Charles Clifford.
In his parliamentary answer, Mr. Clifford said a local consultant’s recommendation went against proceeding with the site, but yet, Mr. Bush went ahead with the purchase of the property some 10 months later. He went on to say that as of May 2005, when the former Minister vacated office, there was still no dedicated hospitality training available in the Cayman Islands.
Minister Clifford intends to pursue the recommendations made in the consultant’s report and to look into establishing an apprenticeship programme involving host sites and private sector involvement.
‘I will seek ways to achieve this outcome in a manner which is economical and most importantly, sustainable,’ he said.
John Swanson with his dog outside of John Silver’s Inn in West Bay
3
Mr. John Swanson at the property
4
John Silver’s Inn in West Bay.
Related Videos
