Forensic Audit Report Says there is Value for Money in Sandals Whitehouse Project


The Forensic audit report into the Sandals Whitehouse construction project in Westmoreland has concluded that, “the hotel constructed is of the highest quality and substantially there is value for money, as indeed everyone who examined the property has recognised”.
It has also noted that the US$41 million cost overrun was in keeping with the size and specification of the hotel.
Minister of Information and Development, Senator Colin Campbell, who was speaking at the weekly post-Cabinet press briefing yesterday (Sept. 4) at Jamaica House, told journalists that the report pointed out that the original projected cost of US$60 million was totally inadequate for the kind of hotel that the parties intended to create.
“The original budget was in the order of US$86 million based upon the Beaches Negril concept. However, it was determined that that cost was too high and eventually it was reduced to US$60 million based upon a recommendation from a company called Capital Options Limited,” the document said.
“It is clear that this figure bore no relationship to the size or specification of the proposed hotel as was conceptualised and proposed by the architects in May 2000. If the original US$60 million budget was adopted, then this would have required a substantial reduction in the size and scope of the project,” the report added.
The Minister said that the auditors pointed out that some additional costs were incurred, “due to management deficits, that is costs from elements such as interest charges, additional fees due to the extended contract period, additional preliminaries and from fluctuations in the cost of labour and materials”.
Senator Campbell said the audit report has concluded that the hotel was not only a valuable asset to the South Coast development programme, but it was an asset to the tourist industry and Jamaica.
The Minister told journalists that so far the hotel has enjoyed record occupancy rates, and there was every reason to believe that if this level of occupancy continued, the company would be able to service the debt without having any recourse to the shareholders.
The forensic audit report will be tabled in the House of Representatives today (September 5), and a copy will be submitted to the Public Accounts Committee. The cost of the audit is approximately $28 million.

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