Minister Otmar Oduber (AVP) shakes the hand of one of the timeshare owners of The Aruban Resort, who had sat in the gallery to follow the debate in the States on the hotel.
ORANJESTAD — The States unanimously agreed with the government’s decision yesterday to act as guarantor for a loan of 1.4 million florins to The Aruban Resort. Tourism-minister Otmar Oduber (AVP) promised to come up with legislation for the guarantee-agreement within 160 days.
The agreement is between investment bank AIB and the government. The Minister will also arrange for legislation regarding the relevant conditions of the loan between the bank and The Aruban Resort Coop, to which timeshare-owners and mortgage banks had agreed. The latter two had previously laid a claim on the hotel. For that matter, AIB had already signed a loan-agreement with The Aruban Resort Coop. last Friday.
The debate in the States had lasted hours. Dismissed hotel personnel as well as timeshare-owners who various parliamentarians had addressed directly, had been present during the debate. Minister Oduber assured the parliament that the government is running little risk with the proposed conditions. In the worse case, the government would have to pay 570.000 florins of the loan. On the other hand, in the case of permanent closure, 4800 timeshare owners would be duped, the dismissed personnel members would no longer have a prospect of a job, and Aruba would be burdened with another ‘Bushiri hotel’, according to the Minister, while such a hotel, he says, generates many millions for the country.
Oduber had hardly encountered opposition, rather support from the largest opposition-party MEP. Former Minister of Tourism, Edison Briesen said he had complete confidence in the management team Royal who will be managing the hotel soon.
“I know them and believe they will perform well.” Of the own party, in the person of parliamentarian Juan David Yrausquin, Minister Oduber received a number of pointed questions on the durance of the guarantee-agreement. Yrausquin also wanted to know from the Minister how the borrowed money will be used.
Scoundrels During the debate, Oduber did not have a good word to say about the former managers of the hotel, amongst whom Paul Moore. “They were scoundrels”, said the Minister. He compared the company structure with a shopping center. As eleven incorporated companies in total had been involved, it was difficult to figure out who was responsible for the enormous debts. At a certain stage, the managers had run up a debt on Aruba of 7 million dollars and in the United States, their home base, of 72 million dollars. The banks in the US had taken action once the managers had stopped paying their debts. The American entrepreneurs had never invested in The Aruban Hotel in spite of their promises, according to Oduber, and there had been no money on the account from the beginning for the personnel, approx. 240 people. Salaries had constantly been paid too late and the employees themselves had gotten into financial difficulties. The situation had become so serious at a certain stage that the personnel had bought cleaning products themselves in order to keep the hotel tidy, according to the Minister.
thanks for the updates Lisa!
And a Thank You to Minister, Parliament..a special Thank You to the staff for doing all they did to help the vacationers during the dark days.
We know quite a few staff folks that truly deserve better.
From the Aruban board dated 17 feb at 3am:
Hi All, After a very long day, we negotiated and finalized the loan. This afternoon, I signed the agreement with Elmar to turn on the power. It was too late in the day today and we want to be sure we proceed carefully.
Once I see that switch go on, I will proceed to WEB and work on the water. I expect to be able to accomplish that agreement tomorrow as well.
If everything goes well after 24-36 hours of warm up, we will be able to try the air conditioning, which is one of the most frsgile and important components.
If that goes okay, the staff will start to return and we can expect that the resort will open for guests the following week. I am optimistic that we will be prepared.
I have been too busy to negotiate some of the other needed agreements, but hopefully will have most done by the end of this week.
the other 60% of the unsold units were owned by KL (the company that declared bankruptcy, failed to pay the staff, defaulted on utilities, and from what many are saying, scammers/scoundrels). those unsold units are now in the possession of the court overseers.
owners paid assessments.........now no records showing that from KL co, which was also the management co.
owners paid maintenance fees......no records either of those.
YES THERE ARE CANCELLED CHECKS IN OWNER"S POSSESSION...thank goodness.
so, the current owners, those that bought prior to mid december 2009 are still indeed deeded owners.
will the resort make it?
who will buy up the unsold inventory?
who will manage the resort?
will there be enough owners present to make a quorum so a new board of director vote can be taken?
i know many that are going to just walk away and let their units be taken back as new unsold inventory.
i know many that will NOT pay any more maintenance fees til the resort is operational and breathing new life.
i have been told that the new tourism minister has been great in helping to come to a resolution.
IMO, if i were an owner..........i would not fork over one more nickel to that place.
Apparently it will go for auction.
See who is the lucky or unlucky bidder.
Tons of debt.
Tons of repairs needed.
The place was in rears when it was under the umbrella of Lacabana due to other "scoundrels that mismanaged...til Lacabana with the help of the judicial system booted their butts out".
The place was in rears when managed by "scoundrels" KL (i too love that word liz)
So, who is going to be the new owner? new manager? Is third time a charm?
I am a betting kind of person and that would be a bet I would walk away from.