As early as June 1993, the Government of Grenada signed a memorandum of understanding with a regional development company to explore the development of a new Cruise Port. In September 1998, the parties signed a Joint Venture Agreement with the license for reclaiming approx. 9 hectares of land for the development of the new Cruise Port, and for the expansion of St. George’s commercial district.
Two years later, it became apparent to the Government of Grenada that the regional development company could not realise this project. Via its network of ambassadors, the Government of Grenada searched for alternatives, in order to bring the project to completion. In this connection, contact was established with the Zublin Group, a Swiss/Dutch real estate investment, development and construction group.
After an in depth study of the project, the Zublin group concluded that it would be possible to construct the Cruise Port and complete the land reclamation for a total of US$ 30-35 million. After agreeing to take over the obligations of the regional development company, the Zublin Group established a local development company, Zublin Grenada Ltd. (“Zublin”), which entered in to an Indenture of Assignment on November 8, 2000 with the regional development company and the Government of Grenada. This agreement assigned the rights of the regional development company, and the licence for land reclamation to Zublin.
In the next 12 months, the preliminary project design was completed and a tender procedure was started in the first quarter of 2001 for a design and construction (“turnkey”) contract with a marine contractor. Additional studies were carried out pertaining to sub-soil conditions, wave analysis, etc, as well as an extensive cruise market and retail analysis in order to assess Grenada’s market position in the southern Caribbean.
During this development period it became clear from the meetings with cruise ship operators, the Government of Grenada and the Grenada Ports Authority, that a port owned by a private enterprise was less desirable.
As a result of this, the Government of Grenada, GPA and Zublin agreed that Zublin would undertake the development and construction of the Marine and Dockside facilities for and on behalf of Grenada Ports Authority on a turnkey basis, arrange for the financing of the project and undertake the development of the landside of the project, consisting of a retail centre, offices, walkways roads, parking etc.
On December 21, 2001, Zublin and GPA signed a design and construction contract for the construction of the Marine and Dockside facilities for the Grenada Cruise Port at a total fixed price of US$23.9 million. The balance of US$ 8 million investment for the reclamation of the land and providing for its road and infrastructure remained with Zublin, as well as an estimated investment of approximately US$ 11.0 million in the retail centre, including cost for acquisition of lands.
A major setback occurred in the summer of 2002, when it became clear that the initial contractor, Ballast Nedam, due to internal financial difficulties, would not be able to take carry out the construction of the Cruise Port. Zublin, therefore, decided to engage a new marine subcontractor. In order to keep the favourable financing structure in place, the choice was again made for a Dutch marine contractor, Volker Stevin Construction.
Within only a few months, Zublin managed to transfer the project to the new contractor, while the financing structure was kept in place. Construction work began in December 12, 2002 and on March 6, 2004 the jetty was officially delivered to Grenada Ports Authority; followed by the handing over of the Visitors Welcome Centre and the opening of the Cruise Port on December 16, 2004.
Zublin then initiated the development of a 5,000 sq. meter duty free retail building in 2003, and construction began on December 16, 2004. Retail entrepreneurs have already signed rental contracts for more than 70% of the total rental space. This project means a further investment of almost US$11.0 million by Zublin.
