‘NMI needs to keep long-term investors’

Hotel Association of the Northern Mariana Islands president Gloria Cavanagh and Marianas Visitors Authority managing director Chris Concepcion said the CNMI needs long-term investors that would keep the local economy going, especially the post-Super Typhoon Yutu recovery of the islands of Saipan and Tinian.

Both Cavanagh and Concepcion are reacting after then acting governor Victor B. Hocog signed into law House Bill 20-35, Senate Draft 3, House Draft 2 that increases public land leases to 40 years and a 15-year extension last Dec. 31, 2018. H.B. 20-35, introduced by Senate President and lieutenant governor-elect Arnold I. Palacios (R-Saipan), is now Public Law 20-84

The signing of P.L. 20-84 was also timely with Fiesta Resort & Spa and Hyatt Regency Saipan about to renegotiate their respective land leases with the Department of Public Lands. Fiesta’s land lease is set to expire in June 2021 while Hyatt will be in December 2021. It was, however, too late for Mariana Resort & Spa as it shut down on Sept. 30, 2018.

Fiesta general manager Wendi Herring said their management have been waiting for the signing into law of Palacios’ legislation. “Fiesta’s lease is essentially right around the corner. As such, we are extremely grateful to the Legislature and administration for [the signing]. We look forward to the opportunity to negotiate and work with DPL in hopes of obtaining an extension.

Cavanagh and Concepcion added HANMI and MVA welcomed the new law as they have been waiting for a similar bill to pass for many years now and even citied the expiring land leases of Fiesta and Hyatt.

“Prior to 2013, 21 years brought us only three healthy tourism numbers. In 2013, we saw that the tourism market showed signs of recovery. In 2016 we saw the second highest numbers in the CNMI. However, prior to Super Typhoon Yutu, we saw modest declines in our numbers and then after Yutu, a complete drop off,” said Cavanagh.

Concepcion added MVA had fully supported the law. “MVA is pleased with the signing of [P.L. 20-84] which will allow existing hoteliers on public lands to negotiate an extension on their leases for up to 55 years. This was something the MVA supported from the beginning so we are glad to see it finally become law.”

Cavanagh, who was still the general manager of Mariana Resort back then, said DPL asked them if Mariana Resort is still interested of having a new lease that the management responded positively. But things did not go as planned.

“However, with the incoming casino, I feel the people no longer saw the value of the long-term investor. Now, we have a long-term investor, Kan Pacific, close its operations of Mariana Resort because a [request for proposal] was issued and never settled for a higher bidder.”

Now, Cavanagh and Concepcion agreed that the government saw the importance of keeping long-term investors on the islands to keep the economy going.

“We are happy that the Legislature and the administration realized the importance of a continuing economy and the value of loyalty, longevity and trust. We look forward to discussions and future negotiations,” said Cavanagh.

Concepcion added hotels like Fiesta, Hyatt, even the Mariana Resort, and other businesses that occupy public lands have been an integral part of the CNMI’s economy. “[These hotels] have been with the CNMI for nearly four decades, in good times and in very bad times, and that shows good faith on their part. They’ve invested heavily in our islands and our people.”

He said stability is needed to keep the CNMI’s tourism industry improving. “What the tourism industry needs in this time of recovery is a sense of stability and continuity because this shows other investors that it’s safe and profitable to do business in the CNMI.”

“This is a very important message for the market at this critical time in our history. This law will benefit the tourism industry as it allows stability in the market,” Concepcion added referring to P.L. 20-85’s importance in the Commonwealth’s economy.