The majority of a fully developed luxury beach resort in the British West Indies will be sold at a public auction on May 2 as part of a restructuring aimed at settling debt obligations owed to the property’s original developer. Cap Juluca, a five-star resort in Anguilla, is being offered to qualified investors through DK Realty Partners, which is handling the international auction.
Located on 179 acres of land owned by the government of Anguilla, Cap Juluca comprises 95 suites spread among 18 villas, as well as restaurants, a fitness centre, a swimming pool and tennis courts. The portion of the property up for auction represents 53 of those suites and all common areas, as well as substantial land rights.
“The true value of this offering is in the potential development of additional villas,” said David Kaufman, principal at DK Realty and the facilitator of the auction. “Although a new owner would need to renegotiate the property’s long-term lease, this is not anticipated to be an issue and is likely to be renewed at the same rent as now.”
Bidders are required to deposit a cashier’s check in the sum of $250,000 with the seller’s local counsel, Webster Dyrud Mitchell, and the successful bidder must bring the total deposit to 10 percent of the successful high bid within 24 hours of the auction by wire transfer of funds. The auction, which is believed to be absolute, will be conducted at the Paradise Cove resort.
The property is being sold due to a default on payments under terms of a settlement agreement between the current owner of the asset – Leeward Isles Resorts, a company run by real estate operator Adam Aron – and Charles Hickox, the original developer of the property. Aron, the former chairman and CEO of Vail Resorts, originally owed about $100 million to Hickox following his acquisition of the property, but the two parties agreed to an $85 million settlement in October 2010. Aron paid off about $15 million of the reduced amount before defaulting on the remaining payments.
News of the Cap Juluca auction follows last month’s announcement of another Caribbean resort on the auction block. The Palmyra Resort & Spa, an unfinished 280-room hotel and condominium complex in Montego Bay, Jamaica, is being sold by the project’s lenders. Sealed bids for that auction are due on 28 March.