OPERATIONS are still underway at the Jamaica Pegasus Hotel as no plans for closure appear to be on the table, even though the new owners announced their intention to do so in light of the planned entry of the large international chain Marriott Hotel.

“It’s business as usual, and I’m not aware of any developments” said Eldon Bremner, general manager of the hotel.

Just months ago Quivin Holding said “the company/lessor will have to cease operations, close the hotel and terminate all staff and third-party contracts. As the new operator/lessee, we will start to refurbish and re-equip the hotel. We will also start to restructure operations and start interviewing staff for employment in the new operation.”

Subsequently, the new owners came under fire from the Bustamante Industrial Trade Union (BITU) which criticised its plans which would lay off the hotel’s nearly 300 employees who it represents. Bremner said he was not in a position to give an update on those plans or any planned upgrades as he has been instructed to continue taking bookings for the hotel.

The Pegasus was recently upgraded while under government majority ownership, however, the new owners, led by hotelier Kevin Hendrickson, deemed it inadequate to being competitive. A new round of upgrades was announced to complement the J$503 million dollars already spent to improve the quality of the hotel’s offerings in a bid to increase revenue.

Quivin Holding paid the Government of Jamaica almost a billion dollars to acquire nearly 60 per cent of the Jamaica Pegasus’s stock units last November.

The decision to close the hotel came against total cash outflows over a five-year period exceeding cash inflows by just under $70 million. Added to this were disappointing occupancy and revenue and net loss of over $60 million despite budgeted profits of $25.85 million.

What’s more, the hotel incurred pre-tax losses of $78.6 million for the year that ended March 31, 2011 compared to $9.8-million profit before tax a year earlier. The dramatic decline in profitability occured against a marginal increase in revenue from $966 million for the 12 months ended March 31, 2010 to $989.9 million during the last financial year. Quivin, in April, also stated that underperformance was discovered in several key areas of the hotel and that if it persisted it was unlikely the Pegasus would be able to meet its financial obligations by March 2012.

Bremner did say there are upgrades taking place however these are routine and not linked to the multimillion dollar improvements that were declared.