PelicanNews
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PelicanNews
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T.A.P.R.C. 4th QUARTERLY MEETING 2005
December 6th 2005 - 2:15
The Chairman opened the meeting and welcomed the Board, Royal Resorts management, and our legal counsel. Marina Project - It was reported that the non-financial aspects of the Project are progressing. The plan is to start the project in early January or February 2006. It will take about 20 months to complete construction, with completion sometime in 2007. Royal Resorts received responses from all four banks in Sint Maarten stating they are not interested in funding the project. Quantum has offered a commitment letter for the construction loan for the Project. There are really no other financing options. An owner spoke to Royal earlier about offering his services to broker a loan, and also approached the Board. It would take six to nine months before this loan could be completed. The Board has decided not to go with this proposal. Quantum will lend money (maximum construction loan is lesser of $18 M or 80% of construction costs; maximum receivables loan is $32M) at a fixed 10% per annum on a secured basis. The Quantum commitment letter and revised projections for the Project were circulated to the Board for discussion. The Board approved the commitment letter. Royal will meet with the government and will provide all the documents necessary, including a document showing that we have construction financing. Many owners will want units where they don’t have to move every Saturday. There is a pent up demand for units from owners interested in the new building. It is expected pre-construction units will sell easily. The Board has made the hard decision to work toward a positive cash flow with a future reserve by increasing the maintenance fee. Food and Beverage - Financial information backing up claimed damages by the previous vendor (FBMD) is to be provided by FBMD Rent from the Great House - Rent of $1,800 per month is due for the 90 square foot area of the Great House built on our property. Vlietman has not paid the rent for 2005. Pelican would have a claim for the past due rent. Ongoing rent should be negotiated with the new owner of the Great House. We do not collect any rent for the storage area in D building, where the Riches (the previous food and beverage vendors of the Reef Restaurant) store items for the Veranda restaurant and the beach bar, as it was an agreement with the developer, Vlietman. Los Gauchos - 15% service charge was discussed. The vendor says 50% of customers would not leave a tip if it were not added to the bill. It was agreed that the vendor would be able to earn enough during the year to come up with a new way to pay her staff. The restaurant will stamp the bill with clear notation that 15% has been charged. The Board discussed pricing and other issues. Pool Bars - The agreement on the bars should be extended until December 31st, 2005. A further contract for extension for January 31st could be signed. The current vendor, Jaap, from the Red Piano has the first right of refusal. The hours of operation are to be 10am - to 7pm. There is a need to clarify with the vendor when the bars are open. Phone System - B-Tel is a long distance provider and the Resort is in negotiation for rates. We need to stay ahead of what it costs to run the telephone equipment. Phone service is no longer a money making item and can cost the Resort rather than bring in revenue. Royal Resorts is looking at high-speed connections for the Resort, and looking at options for Internet. Special Contribution and 2005 AMF Balances - The unpaid balance on the Special Contribution as of October 31, 2005 is $215,000 US dollars and represents 5.14% of the total amount billed. The balance on the 2005 Maintenance Fee as of October 31, 2005 is $527,000 US dollars and represents 5.42% of the total amount billed. The total outstanding balance, including previous years is $747,000. Foreclosing procedures on all SC and 2005 AMF balances have been executed (April 22 and June 16) and units are already listed for sale. Forced re-sales - The total forced re-sales is approximately 200 to 300. Approximately 500 units are available for sale by owners. Owners set their own price on a re-sale as opposed to foreclosures where the Resort must sell to new owners who will pay subsequent fees on them, at a price that includes the annual maintenance fee and any special assessments. PCIP Status – The Board discussed if it would be feasible to seek investments for another two million to the PCIP program. The Board decided it would not be feasible at this time. We need to be conservative and take a look at it again further down the road. There is a need to change the PCIP offering documents to reflect that new investors in the PCIP do not have a discount to purchase in the new project. Garbage Issue - The issue with the garbage compactor being at the back of the upper B building has been resolved and the Resort has settled on the new location in the maintenance area. The land for the new project will be cleaned up and blocked off prior to construction. Communication Material - Pelican will arrange for Royal to produce a monthly bulletin to give information for the Resort. The cost will be approximately $800 to a $1,000 per month. The Resort will sell advertisements to cover the cost. The weekly newsletter will be done in Cancun with info supplied from Pelican and the Board. Other - It was announced that there will a transition from Eric Milett to Rodrigo Gamboa. Mr. Gamboa will now oversee financial matters at Pelican Resort. In Closing the Chairman thanked Richard Sutton for his support on the Board. Meeting adjourned at 6 pm. Judy Young Secretary |
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