The rent of $24,000 would be difficult to pay – Sir James Mitchell

An experienced Vincentian hotelier is of the view that anyone operating the Cobblestone Inn hotel would find it difficult to pay a monthly rent of EC$24,150, given the economy of St Vincent and the Grenadines (SVG).

Former Prime Minister Sir James Mitchell, who has himself operated the Frangipani Hotel in Bequia for decades, made the comment while being interviewed last Friday on the OMG morning show on BOOM 106.9 FM.

“I am glad that anybody operating a hotel can pay that kind of fee in St Vincent,” Mitchell said.{{more}}

“Nobody can buy Cobblestone at this stage of the St Vincent economy….Nobody can pay millions of dollars for that and run a hotel, no way,” he added.

The former prime minister had been asked to comment on issues surrounding the ‘Notice to Quit’ that was served on operator of the Cobblestone Inn hotel Ann Joshua on July 12, giving her until September 30, 2016 to vacate the building in which she had been operating a hotel for the last 30 years.

Since March 1, 2011, Joshua had been paying a rent of $24,150 a month for the property, which is owned by the government company National Properties Ltd.

Sir James noted that while he does not know the value of the Cobblestone Inn, which is located on Bay Street in Kingstown, there are several things that must be factored in when the rental value of a hotel is being calculated.

“The relevant thing about a hotel is…what percentage occupancy does it have; what is the cost that Ann Joshua has to put in for the maintenance and what is the electricity bill and so on. Is she in overdraft on having to pay the bank and so on,” Mitchell detailed.

He noted that when the hotel was run by a previous private operator and also by the Government, it ran at a loss.

Joshua first leased the hotel in 1986 under the New Democratic Party (NDP) administration when Mitchell was prime minister.

He also stated that the close proximity of the hotel to popular hangout Heritage Square makes managing it difficult, because of the noise.

“Certainly, I wouldn’t be interested in operating as a hotelier….Ann has survived there very well and I suppose if it goes through the bidding process, she would bid again.”

The former prime minister also stated that Joshua did in fact go through a bidding process before acquiring the hotel under his government. Prime Minister Dr Ralph Gonsalves, in an earlier interview on radio, had said that as far as he was aware, there was no open tendering process when Joshua was first leased the property under the NDP.

“Well if the letter (see below) explains that there was a bidding process, then the evidence is very clear that there was a bidding process,” Mitchell said, referring to a 1986 letter which he, as prime minister, had written and which had been making the rounds of social media recently.

The letter, dated May 9, 1986 and addressed to the Chair, National Hotels Ltd, stated that of the two leading bids on the Cobblestone Inn, the Charles/Joshua offer was appropriate and “they would provide what is needed at this point in time.” The other half of the Charles/Joshua offer was Basil Charles, who runs Basil’s Bar and Restaurant on the ground floor of the Cobblestone Inn.

“I therefore approve the lease to Charles/Joshua on the terms indicated…,” Mitchell said in the 1986 letter.

The former prime minister, however, made it clear that he and Joshua were no longer as close as they once were.

“By the way, Ann Joshua is no supporter or friend of mine anymore,” he declared.

That notwithstanding, he did offer Joshua some words of advice.

“If I were her and I was bidding, I would bid less than I was bidding before.”

Mitchell also noted that if Joshua meets the new requirements, he doesn’t see any reason why she should not be given a new lease on the property. (CM)