Barbados’ Four Seasons Still Stalled After Seventy Seasons


Aerial map of Four Seasons real estate project at Black Rock, Barbados. Source: Google Maps

After almost 20 years and four successive government administrations, the Four Seasons Hotel is still a concrete skeleton of failure standing in Barbados’ tourism landscape.

The partially built project continues to raise questions about whether there are even more issues and miscues buried in the project’s layered history. The project was initially priced at US$160 million but there have been significant cost overruns due to delays, legal fees and theft.

Those questions were part of what led to the launching of an investigation by the CIJN into real estate projects in the Caribbean region which have raised speculation in the public domain with regards to transparency.

  • Four Seasons Hotel (Barbados)
  • Four Seasons Hotel (Barbados)
  • Four Seasons Hotel (Barbados)
  • Four Seasons Hotel (Barbados)

The company running The Four Seasons Hotel (Barbados) was incorporated in 1988 with its longest running member of the board being Trevor A. Carmichael.  Carmichael is one of Barbados’ most esteemed lawyers having received the Order of Barbados in the Grade of Silver Crown of Merit for his contribution to law, financial services and the preservation of the national heritage. He is also listed as a director for over fourteen hundred other companies in Barbados, according to the ICIJ Offshore Leaks Database.

Efforts to get a statement from Dr. Carmichael, however, about his role as a board member of the Four Seasons Hotel, and knowledge of the project, were unsuccessful. 

The current site dates to pre-independence Barbados where 32 acres of the  site housed a rum distillery and a fuel depot as well as other commercial and residential properties. 

The land was bought and assembled by the Cunard family in the 1950s to create the Cunard Paradise Beach Hotel property, and then by Butch Stewart’s Sandals in the early 90s.  The Cunard family are the relatives of Sir Edward Cunard, a British shipping magnate who purchased property in Barbados in the early 1900s.

This is where the troubled history of the site begins.

It was reported by The Sun newspaper in Turks & Caicos that Stewart held the property for 13 years and “never developed it because of, among other things, certain fundamental issues with the Barbados Government at that time”.

During that time, a failed attempt to purchase the property by William Everett Locke Jr, led to a string of court cases leading up to the Privy Council, which is the highest court of appeal for British Commonwealth countries like Barbados. Locke ultimately lost his appeal, but the legal issues prevented any development or sale of the property to interested parties until 2004 when the property was put on the market by Sandals.

Business partners – Robin Paterson and Michael (Mike) Pemberton—expressed interest in the property in 2004 and by 2005, they purchased the property with a slew of high-profile investors and a loan from the Bank of Scotland for US$40 million.

Both British citizens, Paterson and Pemberton moved to Barbados after decades of prior successful real estate deals and developments. Paterson bought Hamptons International in 1996 before selling it for approximately US$54 million dollars in 2004, before moving to Barbados. Real estate developer Pemberton moved to Barbados in the late 70s and established several hotels on the island. But the Four Seasons Hotel Project would prove to be one of the most challenging and longstanding projects for both of them. 

According to Barbados’ Government Information Service (GIS), while touring the site in 2009, the then Minister of Tourism, Richard Sealy, said that the project would increase jobs on the island and also attract more tourists. It was also reported by the GIS that the developer, Mike Pemberton said that the recession of 2008 did not greatly affect the sale of their villas.

He added that “What people tend to find with this development is the security of the Four Seasons brand, because it is a Four Seasons hotel with residences and it is not a block of condominiums. It is a global brand… it is the strongest five-star global brand in the world and people find it very comfortable putting their money into the strength of Four Seasons… and also the destination is very important.”

But U.S. Securities and Exchange Commission (SEC) documents also show that approximately 120 rooms were scheduled to be opened apart from the residential offerings. In another report by the GIS, Pemberton said that “there are businessmen that have sold their businesses, sitting on a lot of cash and the most important thing is that they are coming down [to Barbados] to buy acres”. He also added at the time that the project was scheduled to finish by 2011.

But the global economic situation quickly worsened and according to Robin Paterson, “banks withdrew credit facilities and construction had been put on hold”.

Several high-profile investors such as English composer Andrew Lloyd Webber also began withdrawing their investments in the project after the lengthy delays.

The International Monetary Fund (IMF) Country-Staff Consultation Report for Barbados said that “soon after the first signs of the economic downturns became visible in 2008, the authorities implemented a number of countercyclical measures to protect employment and minimize the impact of the recession on the most vulnerable groups”.

It added that “large capital projects were encouraged or undertaken directly by government agencies”. One of which was a “loan guarantee provided by the central government to private financiers and developers to restart the prominent Four Seasons Hotel and Villas”.

According to the Inter-American Development Bank (IDB) Environmental and Social Strategy Report, “in October 2009, a new independent management team was appointed and worked with the Government of Barbados (GOB) on a rescue plan, which included the GOB providing a government guarantee enabling construction to resume. In July 2010, the guarantee was executed and two months later a credit facility was signed with ANSA McAL, a Trinidadian Merchant Bank”.

This was corroborated in an email correspondence between the CIJN and the current Special Envoy to the Prime Minister of Barbados on Investment and Financial Services, Professor Avinash Persaud, who said that “I was part of an attempt to rescue the project in 2010 and take it out of bankruptcy”. He added that “I left in 2013, when I felt I could do no more”. 

Professor Persaud served as the Executive Chairman of Paradise Beach Ltd and worked with both administrations and banks to broker several deals to revitalise the project. 

As a Professor of International Economics with a long record of accomplishment in international banking, he was considered one of the leading intellectuals in the world of the 2008 financial crisis. According to the UK Prospect Magazine, as a Financial liquidity analyst, adviser to governments around the world, Professor Persaud is the man who has studied “herd” behaviour in finance, and is now trying to stop it.

Since then, the project has been riddled with delays, uncertainties and unanswered questions despite the public pronouncements of successive government ministers.

In his 2020 report, the Auditor General of Barbados, Leigh Trotman, raised questions about the financial details of the Government’s support for the project:

The treatment of the investment in Clearwater Company needs to be further explained. The investment in this Government owned company was recorded at a value of $124 million investment in prior years. It represented an investment by Clearwater in the Four Seasons Hotel project. The value of this investment remained unchanged on the books of Government for several years even though the property on which the investment was based was significantly impaired. In the 2018-2019 financial year, the entire investment was written off. It has not been clearly established what was the basis for the entire write-off of the investment. It was also not clear what was the nature of the investment relationship Clearwater had with the hotel owners. The investment and subsequent write off could not therefore be verified by the auditors.

Efforts to get a response from Mr. Trotman about whether the Government had addressed these issues were unsuccessful up to the time of this report.

Clearwater Bay Ltd. was incorporated in 2010 and is wholly owned and controlled by the Government of Barbados. In 2011, the Clearwater Bay Ltd. (Guarantee of Loan) Act was passed to facilitate a loan Paradise Beach Ltd through the ANSA McAL financing. According to the Act, “The Credit Facility Agreement… entered into on 13th September, 2010, by which the Lenders agreed to make available to the Borrowers…a maximum aggregate amount of US$60,000,000 to facilitate the recommencement of the Four Seasons Development project”. 

 Clearwater Bay Ltd. Directors. Source: ICIJ Offshore Leaks Database

This new financing agreement was highly publicized and made the front page of all the country’s newspapers. 

In response, ANSA McAL released a statement saying that “The loan is for 18 months at an interest rate of 6.75 per cent” and that “the Government of Barbados agreed to guarantee the bridging finance loan in return for a 20 per cent stake in the project”. The bank described itself as the lead arranger in the agreement acting under the confidence of the Government, adding that “once construction on the project is up and running, the developers hope to resume sale of the villas and use that money to complete the construction of the hotel”.

During this time Paradise Beach Ltd. also secured a US$55 million loan from the IDB in 2012, which would have totalled US$ 115 million in financing out of the US$160 million project cost according to the IDB project abstract.

The IDB also said that one of the benefits of its loan was “the long-term tenor financing necessary for the successful resumption and completion of the Project, which is not available from commercial lenders”. But it cancelled the agreement after two years due to the continued delays in the project.

DB Loan Approval
IDB Notice of Cancellation

In a 2013 interview, former Minister of Finance, Chris Sinckler, said that the project was stalled due to the lack of funds by other investors but that due to the more direct involvement of the government that the project should resume soon. This was not the case. Mr. Sinckler could not be reached for a comment. 

Professor Persaud said that “the then government made arrangements to pass title in 2014 to developers”. 

CIJN obtained conveyance documents to confirm the transfer of title from Clearwater Bay Ltd. to Pharliciple Inc. who reportedly purchased the property for approximately US$32 million, which was US$8 million less than the initial purchase price. 

Conveyance Documents
Conveyance Documents

Robin Paterson and Mike Pemberton’s Paradise Beach LLP was dissolved on January 5, 2016, according to a UK Companies House filing but it is unclear when the property title was transferred from Paradise Beach LLP to Clearwater Bay Ltd.

Gazette of Dissolution for Paradise Beach LLP

Persaud added that “when the government tried to get it going again in 2018, it became clear that there was confusion about title.  There is a matter going through the courts that will clarify title. 

I don’t see much happening until that clarification is determined by the court”. 

In a 2021 radio interview with a local station, Starcom Network 92.9 FM, Minister in the Ministry of Finance, Ryan Straughn, responded to questions on the project itself, saying that “as it stands right now there is absolutely no revenue, no activity, anything at all taking place down at Paradise. The Government put in $124 million according to the audit and right now there is nothing to show for it, that’s the reality of it”.

Professor Persaud said that “my understanding is that the Government is the senior creditor and once the clarification on title is made, the senior creditor will probably play a critical role in bringing in a new set of owners/investors who can get a hotel project going again on Paradise Beach. That beautiful spot has been idle for too long”.

The longstanding structure has led to reports of citizens being robbed and the theft of building supplies from the site. Some citizens are still hopeful about the project while others question its efficacy.

Up to the time of this report, there are still many unanswered questions which we hope will be unravelled.

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