The original developer of the Bahamas' Baha Mar resort has sued its primary contractor, alleging 15 counts of fraud and breaches of contract, and claiming that it has suffered more than $3 billion worth of damages.
Sarkis Izmirlian's BML Properties alleged in the claim that defendant China Construction America (CCA) in 2012 began its efforts of fraud, sabotage and misrepresentations that caused the developer to miss the initial late-2014 deadline for the property's debut and caused the developer to lose both its entire equity investment and control of the beachfront resort.
Among other allegations, BML accused CCA of intentionally slowing down work, damaging electric and security systems and misleading both the Bahamas government and the Export-Import Bank of China (EXIM), the project's primary lender.
BML, which filed its lawsuit in New York Supreme Court, also alleged that CCA used a $54 million advance payment from BML to buy the 288-room British Colonial Hilton Nassau Hotel, and said CCA received $145 million in "bailout" fees from EXIM.
In all, BML alleged damages of more than $2.25 billion related to three counts of fraud and breaches of contract, and another $1.15 billion stemming from 12 counts of fraud.
"As a result of Defendants acts and omissions, BML Properties lost its entire $845 million equity investment in the Project, incurred additional hundreds of millions in losses, and lost its right to all the future benefits of running a world-class multi-billion dollar resort with unparalleled amenities, including luxury hotel rooms and suites, golf, a massive pool and beach area, and the Caribbean's largest luxury casino, on property that the Government of the Bahamas had originally suggested to Sarkis Izmirlian (an experienced real estate developer and the Chairman of Baha Mar Ltd.) that Baha Mar Ltd. acquire and redevelop," BML Properties wrote in the claim.
Slated to open in December 2014, Baha Mar finally opened its first phase
this past spring with the debut of the Grand Hyatt Baha Mar under control of Hong Kong-based Chow Tai Fook Enterprises (CTFE), which is in the process of acquiring the resort.
Neither representatives from CCA nor CTFE immediately responded to requests for comment from Travel Weekly on Wednesday.
Baha Mar opened its second hotel
, the 299-room SLS Baha Mar, last month.
A 200-room Rosewood hotel is due to open at Baha Mar in the spring.