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!