An Update on Caneel Bay

(Image taken in December 2017)

(Image taken in December 2017)

Hello everyone and happy Monday! So one of the most common questions we receive here at News of St. John usually relates to the current status of Caneel Bay. As many of you probably know by now, Caneel Bay is currently in shambles. The resort, which spans 170 acres and lies within the Virgin Islands National Park, sustained extreme damage during Hurricane Irma. And sadly, not much has happened on the property since the September 6th storm, and many of you may be wondering why. Well the answer is pretty complicated. We’re going to do our best to break it down to you today with the help of the National Parks Traveler.

Ok, so first let’s go back to 1956 when Laurance Rockefeller bought a large swath of land and donated it to the National Park Service. Rockefeller initially kept the 170-acre parcel that Caneel Bay sits on so it could become a resort. Then in 1983, the Jackson Hole Preserve, a conservation organization established by Rockefeller, donated the Caneel land to the Virgin Islands National Park. At that time, the donation came with a Retained Use Estate agreement (RUE). The RUE gave the Jackson Hole Preserve the ability to use the property and its facilities for a period of 40 years.

Still following me? Ok, great. I’ll continue…

So the end of that 40-year period is September 2023. When this RUE was established back in 1983, the thought was that the buildings and pretty much the entire resort would be donated back to the National Park Service.

Back in 2010, Congress asked the Interior Department to decide whether it would be more beneficial to keep the RUE or whether they should create a concessions agreement for the resort. Under the RUE, CBI Acquisitions, LLC., the company that has managed the resort since 2004, was not required to make any payments to the federal government despite operating a very successful resort in one of the most beautiful places in the world. How crazy is that??!!

So in 2013 it was decided that it made the most sense to change the RUE to more of a longterm lease which would be very similar to a concessions agreement. But guess what? That has yet to be finalized.

I told you this was complicated…

The Park Service and CBI Acquisitions have been trying to reach an agreement since 2014. Clearly those talks have failed. Stacy Plaskett, a US Representative who represents the USVI in Congress, recently introduced legislation that would extend the current RUE for up to 60 years. According to the National Parks Traveler, “that measure, which is to be reviewed by the House Federal Lands Subcommittee on Wednesday, wants to lock in a 1.2 percent fee on gross resort revenues for 15 years, after which the rate could be adjusted. It also would direct the revenues to the General Treasury, not the Park Service, another aspect of her legislation that is at odds with the 2010 law, which directed any lease revenues to go back to the park for ‘visitor services and resource protection'”.

It’s all starting to make sense now, isn’t it? So in a nutshell, CBI Acquisitions is hesitant to spend any money on Caneel knowing that the current RUE only runs through September 2023.

So when will Caneel actually reopen? Well that’s anybody’s guess. Patrick Kidd, Caneel’s marketing director, recently said the following to the National Parks Traveler:

“That timetable is really driven by many different factors. Our owners are working diligently with a lot of different constituencies, both at the local and federal level,” Kidd said. “They all have their own timetables. We have a lot of moving parts at the moment to come together before we can really start determine what that timeline is going to look like towards a rebuild and a reopening.”

And here is something else interesting that was just printed in the National Parks Traveler:

CBI Acquisitions seems determined to secure a new RUE, rather than transition to a concessions agreement. While in recent years the privately held company has kept a relatively low profile before Congress, in 2017 it spent $330,000 on lobbyists tasked specifically to address “(I)ssues related to Retained Use Estate and National Park Services land.”

While talks around the RUE and rebuilding continue, the resort’s management team has entered into a working arrangement with the Hartling Group, a developer in the Turks and Caicos.

“While Caneel Bay crafts their beautiful turnaround story, we’ve brought on their expert team to help market The Palms and The Shore Club,” said Karen Whitt, the Hartling Group’s vice president of sales and marketing, in a written statement to Travel Agent Central. “Recovery is an ecosystem, happening in boardrooms and boots on the ground. Business as usual is the goal, but until then, it’s a collective effort.”

Personally, I wish they took some of that $330,000 and used it to mow their lawn so it looked less like Jurassic Park. But that’s just my two cents. :)

I told you all it was complicate folks. We will keep you all posted as soon as we learn more. In the meantime, have a fantastic day everyone!

49 comments for “An Update on Caneel Bay

  1. Rogher Dimitriov
    February 25, 2018 at 9:15 pm

    The weasels of course want another RUE so they can get more free rent. Everyone should write to their congressman and say don’t give it to them. Make them pay a concessioner’s rent like they should be doing.
    We have gone there for 18 straight years but will not return if the owners keep getting a free ride on the taxpayers back.

    • Capt. Morgan
      February 26, 2018 at 12:45 am

      Amen to that. Another fat cat hiring lobbyists. Is the Virgin islands member of congress on our team? Why wouldn’t the local Park Service get the 1.5 percent to benefit local services? Any adults in the room?

    • Brion Morrisette
      February 26, 2018 at 9:36 am

      True word. The operators of Caneel have been making a killing, paying next to no taxes to the VI, and paying no rent to the Nat’l Park. Greed like that should not be allowed continue. Especially with a tenant who violates local laws and the rights of the public to access both Honeymoon and Caneel Bay beaches, which are supposed to be open to the public. Their poorly trained “security staff” that employs unleashed dogs to scare off the public from exercising its rights of access, is going to backfire on Caneel.
      New – more civic-minded and less greedy -concessionaires are clearly needed.

  2. Concerned
    February 26, 2018 at 12:04 am

    Is Delegate Plaskett an advocate for the company or the territory?

  3. Mike Savage
    February 26, 2018 at 1:02 am

    Well let’s see…it is only gojng to cost $1 to renovate the property and with daily flights to SJ from the US, everything will be fine. So sad to be the voice of reality but anyone who has been on SJ and viewed the property knows it will be stacks of millions to fix, open and operate. In addition if the new normal is a lot more “ fall weather” WHO is signing up for this business? Therefore you can whine all you want about what is fair and indeed these are perfectly logical, but reality is a world apart. No one is going to get on board without significant offsets and a very, very favorable contract. So in the end you have one and only one choice. I don’t need to restate it here. The alternative is the property sits as is, or worse. Sad all the way around. Unfortunately, the only option forward is very, very clear if we hope to see the property operational again as a resort.

    • News of St. John
      News of St. John
      February 26, 2018 at 7:35 am

      Actually a different alternative is to have a different company, who will adhere to the new concessions agreement rather than hiring lobbyists to change what is now law, operate it the way it should be.

      • Russ
        February 26, 2018 at 8:12 am

        I agree with Mike. But why not let the free market system sort it out? Identify and invite the sort of companies that would be great for the management of this little slice of heaven and put it up for a bid. Have the TPL get involved.

        • Scott
          February 26, 2018 at 3:42 pm

          Best, realistic solution yet.
          But since when does logic rule……..

      • Paul
        February 26, 2018 at 12:53 pm

        I feel bad for everyone….. even John and the rest of the staff at Zozo’s. He should have stayed at Gallows! I miss his dinners!

        • Donna
          February 27, 2018 at 10:14 am

          I agree with you and I feel horrible for John and crew. I miss Zozos being at Gallows to this day. In my opinion, 362 sucks…..we’ve been there and won’t go back. John did a great job tho with his place at Caneel and it’s very sad all around to see it all end this way. I always thought Caneel was like the other side of heaven…..

    • Pam Gaffin
      February 26, 2018 at 1:09 pm


      The damage to Caneel has not prevented the company from housing the BBC guys at a very high rate per night – the waterfront buildings got hit bad, but not the entire resort.
      Caneel is fully insured and in fact has 2 years of business interruption insurance where they get paid to stay closed. They did the exact same thing after Hurricane Marilyn – there sister resort in Virgin Gorda tried to pull the same stunt and the BVI government told them they had to be open ASAP or leave the BVI – they were opened in months, Caneel stayed closed for the 2 full years.
      The other concessions in the park pay far more than what is being asked of Caneel – Redwoods, who actually invested money in Cinnamon Bay because Caneel had let it run down so bad, got a 15 year lease and has to pay 2.5% of gross receipts, Caneel Bay Watersports got a 10 year lease and pays 4%, Paradise Agua Tours has a 3 year lease and pays 3%.

      I think the RUE should be for 20 years, with the rate being 2.5%, with 1% of that being paid by the National Park to the VI Government in lieu of property taxes.

      Caneel Bay has never ever, not since day 1 in the 1950’s paid a single penny to the VI Government – no property tax, no gross receipts tax (currently 5%), no income tax, no excise tax, nothing at all. This was in exchange for keeping a large full time staff on all year round. Quite a few years ago, Caneel decided that they would lay off almost all of their employees for 2 months or more to save money. Theses folks were then instructed to collect unemployment insurance to stay alive. At that time the VI Unemployment Fund was in such greeat shape, no employer paid into it unless they actually had an employee collect. ALl that changed once Caneel laid everyone opff (and Frenchmans Reef strated doing it too), within a few short years the Unemployment Fund was in the red and had to borrow heavily fromt he Feds – and has never been repaid so VI Employers are now paying an anuulal federal unemployment penalty of $189 per employee rather than the usual $42 per employee. This is in addition to having to now pay a 1.5% to 22% VI unemployment tax on each employee, another $470 or so.

      Actually instead of asking them to pay 2.5% on the RUE, it would be fairer to actual make them pay the full 5% VI Gross receipts tax, but they are very good at convincing VI Polititians to allow they to continue to be EDC exempt even though they have not done anything more than make repairs, and do not have the required number of full time employees working all year. If it was written into the RUE that the NPS had to make the payments to the USVI, then they could not wiggle out of it.

      • Chuck finley
        February 27, 2018 at 8:39 am

        You tell ’em Gaffin! The unemployment still was all nikolai’s idea. Thank God that horrible man is gone….its only can get better from here.

        • Bryan
          February 28, 2018 at 3:00 pm

          Nikolay is permanently gone? Where to?

      • Sharon Coldren
        February 27, 2018 at 3:24 pm

        Or reinventing it as another sort of national park resort? Could be run by a nonprofit here. Definitely keep the money in the VI.

        • Liza
          February 28, 2018 at 12:10 pm

          Sharon & Pam;

          You guys rock, think of you often and everything you have done for the island and continue to do.

          Pam, I agree as always with all your points. Your arguments were and are always well thought out and backed by facts.

          I confident many changes have been made because of your countless hours of dedication and devotion for the betterment of the island. Sometimes it’s one step forward and two steps back, but you never missed that HUGE jump forward.

          Keep rock’n it!


    • vtsandidge
      February 26, 2018 at 10:24 pm

      Fair that it is going to cost to rebuild, but anyone who has ever stayed there has paid a premium to do so. All the profit has gone to those running it. Time to reinvest in what made that organization the money or let another group have that option. People will still come: location, location, location.

    • max
      February 27, 2018 at 8:37 pm

      This property had hurricane insurance, so I guess insurance is going to pay for the damage. So please DONOT feel bad for the owners. Caneel was far better place before those greedy owners took over the property.

    • Scott Parker
      March 4, 2018 at 5:29 pm


  4. Michael Barry
    February 26, 2018 at 7:45 am

    When Laurance Rockefeller created what we know as Caneel Bay, he brought a vision that included the St. John community in it, and became the largest employer while conserving our precious resources in the park. The element of community is missing from any of the conversations regarding the lease, sad to say. It’s a sign of the times where money talks, loudly and without regard to whom it alienates and the more lawyers that get into this conversation the longer it will take as they continue to write long documents to each other and longer bills to their respective clients. What the community needs is a 5 star or better resort there, off the grid ecologically and on the grid for gross receipts taxes, employment taxes and an occupancy cost that is paid to the park. That is what is consistent with the Rockefeller legacy.

    My guess, though. is that there will not be a fish fry for the re-opening of Caneel Bay.

  5. Frann Hart
    February 26, 2018 at 8:41 am

    We camoed at the National park a couple times…is that still there?

  6. Brian
    February 26, 2018 at 8:45 am

    Up until last year or maybe two years ago, CBI was also managing the Cinnamon Bay campground. I believe they had a similar agreement in place. The two or so years before their contract ran out, they showed the same reluctance to invest anything in the campground, and the property suffered. Holes in the tents, broken picnic tables, dangerous seats in the now-defunct amphitheater, etc. I understand the business reasons for not wanting to sink any more money, but that lame-duck mentality makes for poor service and a less enjoyable stay. The only reason for CBI to sink any money into Caneel would be that they are 100% committed to the place for the long-haul.

    As an aside, the new management team at Cinnamon invested tons of money to put up new eco-tents and then left them fully assembled during two of the most powerful hurricanes to affect the islands. Oh, and by the way, the campground closes in September and October since it’s so slow, which begs the question why leave the tents fully assembled when no one is staying there? Maybe the tents are hard to disassemble, but if that’s so, why in the world would they choose those tents?

  7. Demi Sutherland
    February 26, 2018 at 9:05 am

    It’s obvious Mike Savage is on the lobbyist payroll.

  8. Chris
    February 26, 2018 at 9:43 am

    I think everyone needs to focus on getting Caneel Bay up and running in order to get folks back to work. I agree that the 1.5 fee should be paid and go to the Island. Hopefully greed won’t get in the way. Thanks for the update – I look forward to it everyday.

  9. Susan L.T. Goodhart
    February 26, 2018 at 9:52 am

    If Cinnamon Bay Resort had insurance why are they soliciting volunteers on their website to rebuild the place for free? I would also like to know why the tents were left up knowing a major hurricane was about to roll through. As for Caneel, it’s a cash cow on the nicest beach in the Carribean. It’s absurd they aren’t paying rent. I say demolish the buildings completely and return it to NPS so ALL visitors to STJ can access the beach and grounds, not just the wealthy and elite.

    • Marco
      February 26, 2018 at 10:38 am

      It would make a beautiful Park

      • David
        March 9, 2018 at 2:28 pm

        Marco, you could finish that sentence with “and destroy the local economy.”

    • Mike garbo
      February 26, 2018 at 12:57 pm

      St John needs the beds.

  10. Samuel T. Marsh
    February 26, 2018 at 10:02 am

    In recent years Caneel Resort has not allowed day visitors to their beaches, beaches supposed to be open to everyone. I say Karma needs to bite them in the butt for how they have treated the non-rich people. It’s time we the PEOPLE need to rise up and take back our beaches. Roosevelt never intended wealthy snobs and pushy elitist resort managers to exclude anyone from the grounds.

  11. Marco
    February 26, 2018 at 10:36 am

    The last time we ate at ZoZo’s Sumner Redstone was at the next table. Maybe he can cut loose one of his billions to restore the place. I know I’m being flippant but the point is it’s going to take millions to fix up Caneel and the reality is it’s probably going to be many, many years (if ever) before anything is back in operation. And that’s very unfortunate.

  12. John Dickinson
    February 26, 2018 at 12:00 pm

    We stayed on St John for 3 weeks with friends over Christmas 2016 and visited every beach, hiked every trail, and loved every minute…except for our visit to Caneel Bay Resort. Our little family of 4 including 2 teenage daughters must have looked pretty threatening because security was all over us when, after our public beach visit and gift shop purchase, we decided to explore the resort grounds. We’ve never felt so unwelcome in any of our travels, but we do hope this beautiful spot is restored under more appropriate terms and conditions. Oh yeah, and we’ll be back to St John–thanks for the updates Jenn!

  13. Roger
    February 26, 2018 at 1:41 pm

    This is the press release from 2004, spelling out the parties to the Caneel Bay Resort. If you truly care, you will all put pressure on all of the groups to honor their responsibilities to get the employees BACK to WORK.

    WESTPORT, Conn.–(BUSINESS WIRE)–May 13, 2004–Equis Financial Group and its affiliates announced today that it acquired, through CBI Acquisition LLC, the award winning Caneel Bay, a Rosewood resort on St. John Island in the U.S. Virgin Islands, In addition to Equis, other principal shareholders and investors of CBI Acquisition LLC include Rosewood Hotels & Resorts, who has managed Caneel Bay since 1993, and Howard Guja, President and CEO of Roebling Advisors LLC, who has facilitated some of the largest residential and commercial real estate transactions in the nation.

  14. Greg Cassidy
    February 26, 2018 at 1:52 pm

    While this may have already been addressed, since the widely accepted opinion is that it will be a long time before Caneel opens, if ever – can the beaches on the property be opened somehow to all St. John visitors? At least until the time comes when something does happen? I mean, it’s not like St. John has a scarcity of nice beaches to explore, but why let the Caneel beaches go un-enjoyed during this time? When life gives you lemons, make lemonade. I’m sure there would be some red tape to unravel to do this, but would it be so difficult?

  15. Tara
    February 26, 2018 at 3:20 pm

    Thanks for the update, Jenn! What does this mean for visitor access to the beaches while the resort is in limbo? I understand that all beaches can be accessed by water, and Honeymoon/Solomon are accessible by hike. But are visitors allowed to walk to Scott & Turtle Bay beaches, for instance?

    • Kendall
      February 27, 2018 at 12:55 pm

      I was wondering the same thing… where can you park to access Honeymoon?

  16. Julie
    February 26, 2018 at 3:46 pm

    So I am not sure if Brion’s post above is serious about Caneel using ” unleashed dogs to scare off the public from exercising its rights of access”. Is that true Jen? I thought the public was allowed to access all of the Caneel beaches- though by water only as the public was not permitted to cross the property itself or use the resort’s beach chairs which is the rule we always went by. We’d swim off the main Caneel beach and snorkel around the corner to the right and along past Scott and rest on the beach as needed.

    To your knowledge Jen, is there some prohibition from accessing the beaches from the water? I thought there was some federal law forbidding the blocking of access?

    If I were to pull up a dingy on Turtle or Scott am I going to be met with unleashed security dogs?

  17. Larry
    February 26, 2018 at 4:33 pm

    Laurence is probably turning over in his grave right now—–I really don’t think greed played a role in his visions for St John. I’m for giving it to the park service, cleaning it up, and OPENING it up to the public—all of it. I’d like to think Mr Rockefeller would approve.

    • Donna
      February 27, 2018 at 10:26 am

      I agree! He had a major respect and love for the land and all of this stuff I’m reading us making me ill

    • A M Brabham
      March 7, 2018 at 7:03 pm

      Mr. Rockefeller was a brilliant businessman, picked out the most beautiful places in the world for his family’s enjoyment and later Rockresorts (see Little Dix, Jackson Hole, Mauna Kea,Caneel), bought up the surrounding property at each, donated it to the government and likely got an excellent tax benefit as well as protecting his jewel properties, and then cashed out. The post that details the lack of any taxable activity at Caneel is incredible.
      I love the place, but it may well be a very nice campsite in 5 years the way this is going. We will cherish our memories of 25+ years of visiting there. RIP.

  18. Gregg
    February 26, 2018 at 6:03 pm

    Wow, great commentary. Nice to see a complete vidio of property. Actualy see it first hand.Just a thought. Maybe U-tube it. The revenues could be used to cut some grass. Make it look, like it should. Alway’s, can get a casino as a invester. Hire only local employee’s. Attach a nine hole public golf course, and good to go. All emenities day light hours only. Let the security dog’s, roam at night. It has been said,” A wise man has two clock’s, …. But does’nt know which time to choose,”.

  19. Jasmine E.S. Peeyen
    February 27, 2018 at 9:47 pm

    This whole idea of buying politicians off so some corporate fat cats can get rich makes me ill just thinking about it. And to think it’s happening on lovely St. John makes me doubly ill. I won’t ever give them a dime and will make sure my giant riff raff family enjoys all the beaches at Caneel. Take that you corporate schmucks.

  20. Carlene
    February 28, 2018 at 9:48 am

    Thanks for this great update on Caneel! Can you please do the same with Cinnamon “resort” & campground? (I HATE that name change!!).

  21. Mary
    February 28, 2018 at 12:13 pm

    Setting aside politics, I was lucky enough to get to go to Caneel Bay 7 times, and each time was so special. There truly isn’t another place I’ve been to, like it. It felt like a huge nature preserve and mostly a sanctuary to get away from everyone and reconnect to the earth, sky, and ocean. Our first trip to St John we were at the Westin, but quickly discovered Honeymoon Beach (Westin’s beach was a huge let down), which lead us to save our pennies to visit Caneel in the off season, and it did not disappoint. We’ve met people who have been going there for 20+ years in a row…..There is no place we would rather vacation. We like St John, but we come to the island for Caneel……………I hope to go again someday.

  22. John
    February 28, 2018 at 12:31 pm

    While everyone wants to bash the corporate fat cats, do you ever stop and think off the hundreds of employees of islanders who work there and depend on that resort for a living. Not to mention the money they spend in town, on boat and snorkeling trips eco ect. We need the resort to bring in DOLLARS!

  23. Barbara
    March 1, 2018 at 8:36 am

    So many great points of view. Not only locals but our necessary regular devotees of this very special island. It would, I think be a great disservice to “bulldoze” the resort so locals could have more beaches since St John is rich with so many with such variety of personalities. The continuation of Caneel Resort is essential to the economic health of the island. Unfortunately the exclusivity that locals hate is what brings people in to spend their many thousands. It’s too bad we have to consider economics but that’s life. Personally I get nostalgic for having to shop at 3 to 4 grocery stores to find what I need and see more quiet sailboats on the water instead of the massive proliferation of motorboats that have taken over the view. Oh well things change I guess.

  24. Liza
    March 1, 2018 at 12:00 pm

    I agree the resort should be brought back, but should pay its share of rent/taxes, etc. Caneel Bay provides good employment on the island, which could provide future careers to those that want to move ahead.

    When Laurence got married, he and his wife sailed the Caribbean until they found the perfect location for his resort. He bought up land and donated it and pushed for the creation of the park. He took care of his employees, provided housing, food and wages. Not sure if they were good or bad, but wages were steady. First and foremost, he built a resort with the utmost respect to the island. He cared about the island so must, he didn’t destroy hillsides, trespass or destroy the livelihood of neighbors.

    But all this came with a price to locals which hasn’t been brought up. Chase Manhattan was the only bank allowed on St. John (run by his brother David) up until the 80’s. So corporate greed does have history on St. John.

    I do know for a fact he held Caneel Bay near and dear to his heart until his death. Every time he left the island, he would turn around in his boat and tear up and say it’s the most beautiful place on earth, until next time.

  25. Tom
    March 3, 2018 at 7:23 am

    I remember the first time I saw Caneel Bay from the overlook and it was love at first site! I told myself at that time that I would return with my wife and stay there.

    Ironically, it was the first place we visited after losing our home in Hurricane Katrina. Being in that beautiful place helped heal us. The natural beauty was only accentuated by the simplicity of the buildings and the resort design and the Rockefeller history and legacy.
    After our first time there, I promised my wife that we would return every year. Yes, it was expensive, but it was unique and no first class resort in the Caribbean is cheap.

    Over the 12 years since our first visit, we fell in love with St John and ‘graduated’ to villas, but we always stayed at Caneel part of the time.

    When we saw the damage caused to St John by the storms, we felt as we did after Katrina. We were heartbroken and my wife cried when she saw the pictures of the resort.
    People that stayed at Caneel visited the towns and shopped and ate at the restaurants, and went back hope and told others of their experiences.

    It was a very special place to many people. Living in a tourist city myself, it is important to have diversity with regard to lodging. Of course, a park there would be beautiful, but how do you replace the economic impact of a unique 5 star resort? The jobs and economic multiplier effect? Caneel as a managed property had its issues, and I was not aware of the corporate, legal and tax aspects. But now is the opportunity for a redo, and hopefully those that control the fate of the property get it right!

    Hopefully it will be rebuilt with the same love as it’s original developer!

    almost as we did a

  26. Michael
    March 6, 2018 at 9:31 am

    Maybe if this were a topic with the national news media some of our sleezy politicians who are in bed with lobbyists would be less hesitant to vote for profit which they do frequently. The Nstional Parks service should be up in arms.

  27. Rita De Ferrary
    March 6, 2018 at 11:05 am

    Sometime after the storms we received a letter of ‘force majuere’ from Caneel Bay. At the time we had no accounts receivable pending, but I’m sure there were vendors, local and stateside that had outstanding open invoices. How can a corporation with a total tax holiday, and full insurance coverage get away with that? If legal, it’s certsinly not ethical, and wouldn’t their insurance cover that, if not, why not? Shouldn’t the VI Government require local vendors to be paid, and require a definitive insurance clause? The IG’s office along with the senate should investigate and urge Caneel Bay’s owners to pay any outstanding debts for goods supplied them.

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