A Canada-based property development firm aims to invest US$70 million to renovate the Treasure Island resort after agreeing to a deal to buy a controlling stake in the beleaguered Seven Mile Beach venue.
The property will be completely gutted and transformed into a branded hotel, according to Michael Wilkings, chief operating officer of the Howard Hospitality Group.
“It will be a total renovation. You won’t recognize this place,” he said.
Current owners Restoration Cayman will come out of receivership as a consequence of the deal and will retain a minority stake in the new resort, he said.
Mr. Wilkings declined to say how much his company had paid for its stake in the property, but promised significant investment in improving it.
“It is a fantastic asset in a great location that requires a lot of vision and imagination to figure out what to do with it,” he said. “If you can see past what is here today and imagine what it could be with good design, good branding and significant investment, the potential is fantastic.”
He said the company had recruited Miami-based OBM International architects to work on the “complete renovation” of the hotel.
Treasure Island will likely close for around 18 months while the work takes place, he said.
The company ultimately aims to create a hotel that can compete with the likes of the Marriott, with no residential component. The people living at the resort will have to move out, though he anticipates it will be early 2016 before work begins and that becomes necessary.
“When we are ready to renovate, it will have to be closed,” he said. “We are talking about substantial serious works. If you are just changing the furniture you can keep it open, but that is not the case here.”
The structure of the building will remain intact.
“There are a few things we need to look at but nothing major,” Mr. Wilkings said. “The building has good bones and we will keep that but renovate everything else.”
Restoration Cayman, the previous owner of the resort, was put into receivership in November last year after Scotiabank called in a loan.
The company had until last month to come up with a solution to its financial problems or face the forced sale of the hotel, which was put on the market for US$15.4 million.
Harry Lalli, of Restoration Cayman, said at the time that the group was working to secure new investment.
The deal with the Howard Hospitality Group will see the Scotiabank loan repaid and Restoration Cayman retain some involvement in the property.
“We have a binding agreement with the bank and with Restoration Cayman. That transaction should close within the next 60 days,” said Mr. Wilkings.
The adjoining Sunset Cove condos, which front onto Seven Mile Beach, are not part of the deal, but the two properties share easement rights, giving the Treasure Island resort beach access. The shared areas, including the pools and the Billy Bones bar, could also be renovated as part of the investment.
Mr. Wilkings said new bars and restaurants would also be added.
“One of the things we are really focused on is making this accessible to the community,” he said. “There [are] a lot of young professionals on the island and not so much for them to do in the evenings.”