As project manager of the Sandals Whitehouse project, the state-run Urban Development Corporation (UDC) was clearly responsible for completing the project on time and within the agreed budget of US$70 million, Gorstew insisted yesterday.

Gorstew, Butch Stewart’s holding company which partnered the UDC and the National Investment Bank of Jamaica (NIBJ) on the project, sought to further clarify the issues, following claims made by the UDC in a two-page advertisement carried by the Sunday papers. Following is the text of the Gorstew statement:

“There have been a number of misleading statements appearing in the press relating to the Whitehouse Hotel Project and Gorstew is once again compelled to try to set the record straight.

1. The construction of a hotel at Whitehouse has had a number of false starts. Prior to 2000, there were at least two attempts to develop the property. All architects, consultants, and designers associated with these prior attempts were paid in full and their contracts settled. We wish to make it absolutely clear that there was NO continuation of engagement. The use by the UDC of any previously retained consultants was entirely their decision and their responsibility.

2. A new architect, recommended by Gorstew, with no association to the previously aborted developments at Whitehouse, was employed by the UDC. This architect had worked on a recently completed expansion to Beaches Turks & Caicos. The Beaches Turks & Caicos hotel was visited on two occasions by senior officers of the UDC, including a number of consultants to be appointed on the new Whitehouse hotel project. The Turks & Caicos project was to represent the design standards for the new hotel.

In May 2000, the architect submitted conceptual designs to the UDC, which were later accepted by all parties, namely the UDC, NIBJ and Gorstew, as the approved ‘brief’. These conceptual drawings bear no resemblance or similarity to Beaches Negril and it is completely erroneous to suggest that this hotel was adopted as the standard for the Whitehouse hotel.

It was this architect’s design brief which established the agreed Quantity Surveyors development budget of US$70M, for the Whitehouse Project.

3.The appointments of all consultants to the Whitehouse project, even those recommended by Gorstew, were negotiated by the UDC as project manager.

4. Gorstew had NO role in overseeing the construction of the hotel. Gorstew’s role, as defined by a Technical Services Agreement, was limited to the provision of advisory services which were carried out by Implementation Limited, acting on Gorstew’s behalf. Gorstew requested minimal design changes and it is our firm position that the change from Beaches to Sandals saved money.

5. Neither the Gorstew nor the NIBJ-appointed directors were able to obtain satisfactory and mandated information from the project manager as to the hotel’s eventual cost and were unaware of any cost overruns until one month before the opening of the hotel in February 2005. Gorstew’s proactive attempts to obtain this financial information and reporting were rebuffed.

The Contractor-General’s report states that the completed hotel represents value for money. This was also referred to in the UDC’s advertisement. We disagree. Its final cost exceeds expected norms for hotels of similar standard constructed in Jamaica and the final cost of construction includes substantial claims from Ashtrom Building Systems Ltd, the contractor, for extensions of time and acceleration which, in our opinion, relate to poor project management practices by the UDC. These claims do not represent value for money.

To this day, nearly 18 months after the Hotel opened, a number of construction issues remain unresolved. These are causing many operational service delivery problems for Sandals, and continue to inflict damage to our brand.

We wish the public to fully understand that this project was a joint venture between Gorstew, the NIBJ and the UDC. The roles of each were clearly set out in a formal agreement.

Gorstew, having wide experience in hotel management and marketing, was to provide technical advice on the design so that the development would be saleable in the international hotel marketplace. Gorstew, or its nominee, would be the Tenant/Manager of the final hotel product.

The NIBJ was to provide financial advice and assistance by participating on the Board of the development company and provide equity and loan capital. The UDC, with its experience in hotel development and construction management, was mandated to manage the project in all respects until handover of what was to be a turnkey operation. As project manager they were clearly responsible to complete the project on time and within the agreed budget of US$70M.

The public and the courts will be the final judge as to whether they satisfactorily executed their responsibilities and obligations.”