Caneel Bay operators file ownership claim in court
By SUZANNE CARLSON / Virgin Islands Daily News
The current operator of Caneel Bay Resort on St. John filed a federal lawsuit against the U.S. government Thursday, asking a judge to declare the company the legal owner of the historic 150-acre property.
“Caneel Bay Resort should be rebuilt and the land and resort should belong to the people of St. John and Virgin Islands community. Through this quiet title action, that will happen,” according to the complaint filed in U.S. District Court by attorney Chad Messier of the law firm of Dudley, Newman & Feurzeig LLP, which is representing EHI and CBI Acquisitions.
Developer Laurance Rockefeller deeded the underlying 150 acres to the National Park Service in 1983, retaining the right to operate the resort until September 2023 in an unusual federal land deal that allowed the exclusive luxury hotel to operate in the national park on St. John.
Since the resort operates under a unique Retained Use Estate (RUE), resort owners like CBI Acquisitions have operated the resort on park land for zero rent under the assumption the property will transfer to park ownership in 2023.
In recent years, CBI Acquisitions lobbied for a 60-year, no-bid lease extension as an incentive to rebuild the resort and recoup a purported $100 million investment after the 2017 hurricanes destroyed the property, which has not reopened to overnight guests, which drew backlash from some community members.
The National Park Service announced in July 2021 that after the RUE expires in 2023, there will be a competitive lease process to redevelop Caneel Bay resort, after outcry from St. Johnians who demanded federal officials consider input from ancestral Virgin Islanders.
In November, the Economic Development Commission governing board voted to approve CBI’s request for a retroactive extension of its tax benefit certificate through June 30. The board said that if the company does not resume business by Friday, the tax benefit certificate will be automatically revoked.
The quiet title claim was filed Thursday, the same day day the tax benefit certificate expired.
In February, the National Park Service held public meetings where officials presented four options for future use of Caneel Bay, but the status of that process is unclear.
Park Service representatives could not be reached for comment Thursday.
V.I. Delegate to Congress Stacey Plaskett also did not respond to a request for comment as of Daily News press time.
The 26-page complaint filed Thursday is essentially the company’s pitch to the court as to why EHI and CBI should be declared the property owners.
“Plaintiff EHI Acquisitions, LLC and its affiliate CBI Acquisitions, LLC (collectively ‘Caneel Bay’) made an offer to the United States in 2019 to transfer its title to the buildings and other improvements in the Caneel Bay Resort (‘Resort’) to the United States,” according to the complaint. “The United States declined to accept that offer. As a result, title to the land automatically reverted to EHI Acquisitions, LLC. The United States, however, has refused to recognize that EHI Acquisitions has title to the property, and the United States continues to dispute that ownership.”
The company’s attorneys made detailed overtures about their plans for the resort, and said that if granted ownership, they “will be able to preserve the fragile and beautiful environment, while rebuilding the Resort incorporating a more hurricane-resistant design and construction.”
According to the complaint, “Reopening the Resort will add over 400 jobs and over $160 million to the economy of St. John.”
Attorneys for the National Park Service have not yet filed a response to the complaint.
– Contact Suzanne Carlson at 340-714-9122 or email firstname.lastname@example.org.
For more information on the Caneel Bay RUE, environmental issues and more — https://friendsvinp.org/caneel-bay/