SEARCH NEWS:

 

Kerzner, Bahamas Amend Expansion Agreement

PARADISE ISLAND, The Bahamas -- (PRESS RELEASE) -- Kerzner International Limited (NYSE:KZL):

-Kerzner to Develop Luxury All-Suite Hotel in Lieu of Its Previously Proposed Hotel Tower

-Kerzner to Add 400-Room Condo-Hotel to Phase III Development

-Kerzner to Bring World-Renowned Chefs to Marina Village and Phase III Offering

-Kerzner to Add Ocean Club Residences, an 88-Unit Condominium Project

Kerzner International Limited (NYSE:KZL; the "Company"), a leading international developer and operator of destination resorts, casinos and luxury hotels, today announced that it has entered into a second supplement to the 2003 Heads of Agreement with the Government of The Bahamas ("Government") enabling the Company to proceed with the next major phase of development at its flagship property, Atlantis, Paradise Island. The Company will host a groundbreaking ceremony today on Paradise Island that will officially mark the commencement of this next wave of construction in The Bahamas.

The amended Phase III project will include the following components:

-A 600-room luxury all-suite hotel in lieu of the 1,500-room hotel tower contemplated in the supplement to the 2003 Heads of Agreement. The Company anticipates it will commence development of this project during the second quarter of 2005. The proposed all-suite hotel will be situated west of the Royal Towers, adjacent to one of the best available beach sites in the Caribbean.

-A 400-unit condo-hotel. The Company expects to partner with Turnberry Associates, one of the premier real estate development and property management companies in the United States. The development cost associated with this project is expected to be $200 million. The Company anticipates that this project will be funded on a non-recourse basis based on pre-sales. The Company expects to commence pre-sales of the condo-hotel by the first quarter of 2005.

-No changes to other previously agreed elements of the project, which include a significant expansion to Atlantis's water-based attractions and development of 100,000 square feet of additional group and meeting facilities, the Marina Village and additional timeshare phases.

Butch Kerzner, Chief Executive Officer of the Company, commented, "We have listened to our current customer base, reviewed the continued strong demand for the Atlantis experience and concluded, with the Government, that the 600-room all-suite hotel will encourage visitation to The Bahamas of a new, more affluent leisure and gaming customer. The all-suite hotel will add a new tourist segment to our business and continue to differentiate our product offering."

Butch Kerzner continued, "The all-suite hotel will also complement other key elements of the Phase III expansion, including the expanded water attractions, the meeting and convention space and the Marina Village. Construction of these elements of Phase III remains on track for the end of 2006."

Phase III will also bring the addition of world-renowned chefs and restaurants to Atlantis guests and The Bahamas. Nobu, the internationally-acclaimed new style Japanese restaurant conceived and run by heralded chef Nobu Matsuhisa along with partner Robert DeNiro, will replace Five Twins in the Atlantis Casino. At the Marina Village, which is anticipated to open as early as August 2005, the renaissance of Cafe Martinique will be guided by acclaimed chef Jean-Georges Vongerichten. Carmine's, a popular New York restaurant that serves large portions of home-style antipasti, pastas, seafood and meat entrees designed for sharing, will represent a new family dining option. Other dining and food establishments planned for the Marina Village include Bimini Road, a fun Caribbean experience serving flavorful island fare, and a modern steakhouse with a traditional butchery, wine market and bar.

The Company is also announcing the development of Ocean Club Residences, an 88-unit ultra-luxury condominium project at Ocean Club Estates, the residential development adjacent to the Ocean Club Golf Course. Ocean Club Residences is expected to cater to the highest end of the luxury residential market. The Company expects to commence pre-sales before the end of the year and, subject to the level of pre-sales, will break ground on this project in 2005. The Company will develop this in partnership with a local developer.

It is anticipated that the investment in The Bahamas through the revised Phase III development projects will exceed the $1.0 billion contemplated in the 2003 Heads of Agreement. Exclusive of the Harborside timeshare projects, the condo-hotel, the golf course on Athol Island and Ocean Club Residences, the Company's investment is expected to be approximately $650 million.

Under the Heads of Agreement, the Company has committed to complete substantially the 600-room all-suite hotel by December 2006. The supplement also contemplates the completion of the condo-hotel during 2007. If the Company does not proceed with the condo-hotel and the previously announced golf course on Athol Island, casino tax concessions and the joint marketing contribution from the Government would be reduced beginning in 2009 in accordance with an agreed schedule.

< Gaming News