Government has presented a massive $75M development plan for the cruise pier and surrounding land in Road Town, which will includes a retail village, community park, market, ferris wheel, boardwalk, a terminal building, a chapel and trolley lines.
The development is referred to as the Tortola Pier Park and the investment comes from IDEA and its parent company, US-Based United Infrastructure Group (UIG).
Under the proposed plan, Government will have to lease the land for 48 years to the developers.
Minister for Communications and Works, Hon. Mark Vanterpool and Hugh Darley, President of IDEA presented the proposed plan to the public during a meeting last evening, June 27.
At the meeting, most residents applauded the Government for moving in this direction, but questions were raised about the land being leased and what is in it for the developers.
A section of the proposed plan
Minister Vanterpool said the Government is not taking any risk, pointing out that the developers are the ones pumping the monies into the project, while the Government just has to lease the land.
"What we are doing here is an investment that is costing the Government the use of the land that the Government has here in return for expanding the pier; in return for developing the land; in return for helping to develop our town; and in return that these folks would like to share in the revenue that we are having from the pier here and the increased revenue they are assisting us in negotiating with the cruise lines on the head revenue and port fees that we are getting there. So that is the return; they are willing to take the risk, we have no risk in the project from that point of view," the Minister stated.
He added that Government, residents and developers are going to reap benefits.
"If they decide not to finish the project and they start it, they leave the product they put on the land and we will get somebody else to finish it for us, or the Government will finish it for us...The group is keen about doing it yes, because there are financial returns; they are not doing it for free, they are not doing it because they love us...I think they are doing it for financial return, but in return we are not having any risks, but we are sharing the benefits...I think we should be happy for that...," he told residents.
The Minister re-emphasized that the company is not doing it for free. He said the company would not have come on oard if the Government was not able to secure a guarantee with cruise lines such as Disney and Norwegian, who have guaranteed a large number of passengers over the next 15 years and an increase in overhead tax.
The guaranteed amount of passengers is 425,000 minimum passenger arrivals per year.
He further explained that even if the cruise lines do not produce those passengers, they will still have to pay the Government the overhead tax for the passengers which they had promised.
"Where over the next 15 years we will have a guaranteed number of passengers coming so that we can plan our budget better in terms of ports...Income from this - we want to be able to help fix the ports in West End, Road Town, main cargo dock, Anegada, Jost Van Dyke; we are having guaranteed income...Under that, if Disney or other cruise lines don't bring the number they said they guaranteed to bring, they have pay for them still; have to pay us the head tax for those numbers whether they bring them or not, so we can plan around that in terms of our development...The incentives will be on them to bring those numbers each year," he said.
"Once we complete the port and everything, the cruise lines are agreeing that once we have a better product, they are prepared to pay a higher rate of head tax. This is being shared with the investors and that is where they are going to get back the bulk of their money from..."
Speaking more on the leasing of the land, Minister Vanterpool said it may not be a total of 48 years since they have options in between those years.
"Four and some acres plus of land that we are sitting on is being leased to a partnership between the Ports and this group for 48 years for the investment that is being made with buyout options at 15, 20, 25 or 39 years intervals. Whichever option the Government chooses to exercise they can over the period of time. It's a 48 year lease. There will be no liens or incumbencies on the property by any group or anyone for funding. It is going to be clear from that angle," according to Minister Vanterpool.
He said following the lease, everything goes back to the Government.
"After 48 years, if it we do go that long, because we do have options in between, everything comes back to us for zero dollars...After 48 years the project belongs to the Virgin Islands."
Meanwhile, residents were assured that the Government is not guaranteeing any loan for the company.
"This is not a loan...not taking loan from this group, they are investing their money, hoping that everything works out over the next several years so they can make profit from their money and we are going to make profit too. We are not taking any loan, we are not guaranteeing any loan for them, no guarantee; this is their risk for the guarantee that we are getting from the cruise lines," the Minister asserted.
The Minister also clarified that the Government, through the BVI Ports Authority, will remain in control of the Road Town Port.
"We had made it very clear that no one will manage except the Ports Authority...So the pier and all the ports will continue to be managed only by the Ports Authority...Management, control and authority of the ports remains only of the Government through statutory body...This port is not being sold or leased to anyone," he stated.
In relation to contracts for the project, the Minister assured that local contractors will be assigned the works for the project; however, there will have to be subcontracts for the pier land side given the technical aspect.
The Minister, who said Town and Country Planning also played a role in the discussions, stated that the buildings will be rented to locals and international companies, and there will be reserved space for locals. He said there will be no McDonalds or KFC.
"We will expect, and we are not going to discourage a mix of investment in the project...We do expect to attract certain names in the project, but we are going to reserve a certain number of spaces for our local people in the project; 25 minimum, 500 square foot spaces that would cost a very low rent compared to the other persons who we will invite to come into the project...The decision of who comes into the project will be handled by a management team that is made up of the Ports Authority and this group..."
He added, "We don't want the international franchises like the McDonalds and Kentucky...We are talking like the upscale jewelry places."
Minister Vanterpool assured that the area will be for all residents in the Territory and it will be opened to everyone year-round. "It will be opened seven days a week, but not 24 hours...But it will be opened to the public while the cruise ships are here and when they leave."
Environmental Systems, a local environmental consulting company has been contracted by the BVI Ports Authority to prepare an environmental impact assessment (EIA) for the proposed cruise pier extension. As part of the data collection phase of the EIA, Environmental Systems under the guidance of Dr. Cassander Titley-O'Neal has been conducting a social impact study as a means of gaining insight into the public's impression of cruise tourism in the Territory.
The recent move to push for the expansion of the dock was due to the projected figures which show a decline in cruise arrivals for the 2012/2013 tourist season.
Minister Vanterpool has stated that based on discussions with major cruise lines, the increase in arrivals hinges on the expansion of the pier, concerns with the appearance of cruise ship port and the tents, among other areas. He has pointed out that most of the ships have pulled out because their intention over the last three or four years was to move their smaller ships to other parts of the world where cruise tourism is not as big as the Caribbean.
Closer Look At Tortola Pier Park
The total investment is $75M, with $25M for pier and excursion dock; $25M landside development; and $25M community investment.
The project which will see the BVI Ports moving from B class to A class port, will develop the area in such a way that it will be "married to the rest of Road Town". This, according to Government, will result in other businesses benefiting as a whole, including vendors at the proposed developed Craft Alive Market area.
Darley during his presentation said it is important that the first impression of any tourist destination is an impressive one. He said the development lures the visitors off the ship.
"That sense of arrival is important to people. That first five to ten minutes when you are at a destination, what do you do; you check out and decide right there whether you made a right decision or not. In the Caribbean for the past thirty years, we have taken old cargo ports, loaded up with warehouses and concrete piers and brought these billion dollar ships and bring them into warehouses, concrete piers and big parking lots, so it is hard to get them [passengers] off the ships," he said.
He said they intend to do a lot of landscaping and will be placing more trees in the area. "It's like a little village in Road Town...It's building a waterfront that will bring life to the city...We will re-green up the city."
Darley told residents that one of the reasons why Disney is interested in the BVI is because of its pristine environment and the attitude of the people to ensure that the environment is protected. "We want to preserve that..."
"So we have to get them off the ships...That's the look [proposed plan]. People have those aspirations when they come to the Caribbean...Our idea is that we have to inspire people to get off the vessel. If they stay on board...they don't spend any money. We want when they look down they see something that is so much fun," Darley stated.
He said they are also looking at historical sites development.
Other things which make up the plan include three merchant's walk buildings, black swan tavern, mechanical room, performance stage, carousel feature, waterfront swimming pool, maintenance area an chapel garden.
Minister for Communications and Works, Hon. Mark Vanterpool and Hugh Darley, President of IDEA during the public meeting on June 27, 2012.
Photo Credit: Melissa Edwards/BVI Platinum News
According to Government and developer, as cruise guests disembark from ships to begin their journey into Tortola, the sights and sounds of a traditional August Festival will provide the place-in-time for the bustling Pier Park.
"The nostalgic ferris wheel festival theme and waterfront boardwalk greet visitors approaching by ship, introducing them to charming boutiques, arts and crafts, and waterfront entertainment. The old style village chapel, surrounded by fragrant rose gardens has its own story to tell. The chapel now provides an idyllic spot in which to exchange vows or provide for family gatherings on the new waterfront boardwalk. Trolley cars stand by ready to carry passengers through the retail village and into Road Town to explore more of what Tortola has to offer. As visitors make their way further into Road Town's main street shopping district, they can visit Tortola's historic Post Office, and prison situated between two historic churches and the Virgin Island's folk museum," the developers and Government are selling.
Government believes that some of the benefits that the Tortola Pier Park will bring to the BVI includes world class pier and port facility to accommodate the world's largest cruise ships; increased economic growth in waterfront business district; Disney and Norwegian Cruise Lines promoting BVI tourism through global marketing; experience at pier park will be opened to the community; Government to retain ownership of port with participation in revenue; increased revenue for taxi and existing land side and marine tour operators; creates intent to return for overnight stays and drives long term tourism growth; establishes year round cruise tourism calendar; and increased entrepreneurial opportunities and new business start ups, among other things.
According to the company's website, Idea has been well known as an international design and planning firm that oversees the conceptual design and production of branded destinations for the hospitality, entertainment, and tourism industries. It stated that Idea is currently an industry-leading designer of branded port of call destinations, specializing in marine and waterfront development for signature port attractions. Idea has worked with private developers, Government ministries, independent agencies and cruise lines to create branded port of call destinations in Alaska, Saint Lucia, Saint Maarten, St. Martin, Roatan, Mexico, Saint Kitts, and Jamaica.
Minister Vanterpool said Government did intense research on the company before going into any discussions.
Darley told BVI Platinum News that the extension of the pier is expected to be completed by December of this year, followed by the works on the project which will take one and a half years. He said if the plan is approved with the public input, by January 2014 it will be completed. He said they are looking to extend the pier by 300 feet in length to accommodate the bigger ships.