GERS already has offers for Carambola
Published: April 25, 2014
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ST. THOMAS - While the V.I. Government Employees' Retirement System plans to sell the Carambola Beach Resort and Spa, the system will continue to invest in the property until another entity purchases it.
Several years could pass before the sale, said GERS Administrator Austin Nibbs during the board of trustees' regular meeting on Thursday.
The board announced last week that it voted to sell the resort, located on St. Croix's north shore.
At Thursday's meeting, the board voted to purchase a new generator at a cost of about $181,000 for Carambola.
The board also approved purchasing a new engine for the current generator for about $56,000. The current generator will serve as the secondary generator upon the arrival of the new one.
Board member Carol Callwood suggested that the board look into how the fuel needed for the new generator would be transported. The new generator will require more fuel than the former, so the board's best option might be to purchase its own truck to transport the fuel, she said.
Currently, GERS pays for its generator fuel to be transported to Carambola, though the new generator will require GERS to increase the number of trips required because more fuel will be needed.
Callwood requested that the board assess which option would be more cost-effective.
GERS has owned the property for two years, since Carambola defaulted in 2012 on a $15 million loan it obtained from GERS in 2009. GERS then purchased the 26-building resort.
Since purchasing Carambola, GERS has invested about $3 million in infrastructure improvements, which included room renovations and repaving much of the property, Nibbs said. Additionally, it has made tax and interest payments, for which Nibbs did not want to estimate the cost.
"It's just about finished," Nibbs said.
Carambola will need little more renovation, as it already is a beautiful hotel, Nibbs said. The board already has received at least 15 offers to purchase the resort, some from local investors and some from individuals representing stateside companies, he said.
GERS has not yet issued a formal invitation for bids, though Nibbs expects it to do so in the next month or so.
Mary Moorhead, president of the St. Croix Retirees organization, asked the board during the meeting whether it expected to make money on the sale. Moorhead expressed concern that GERS would not receive what it had invested in the property.
"Our concern is that the board get back what it invested, plus," she said.
Nibbs responded that the board would consider all of the bids, though he could not say whether the board would accept a bid if it meant that GERS would lose money.
"I can't make that decision. That's the board's decision," he said.
The board also went into an executive session during the meeting, though no actions were taken.
On the agenda for the executive session was an update on the management agreement between GERS and West Indian Co. and a presentation about Tibbar Energy, which plans to operate a biomass/biogas facility on St. Croix as part of a power purchase agreement with the V.I. Water and Power Authority.
- Contact Jenny Kane at 714-9102 or email email@example.com.