For almost ten years, a group of shareholders has been waiting to exercise their right to relax in a luxury resort being built in sertanejaa municipality with less than 10,000 inhabitants in the northern region of Paraná 🇧🇷about 80 km from Londrina)🇧🇷
Delivery, initially scheduled for 2013, is now promised for next year. Since then, the project has changed hands and gained a powerful new brand – hard rock resorts -, but it still hasn’t come off the ground.
The project is now in the hands of Venture Capital Participações e Investimentos (VCI), a partner of the American group in Brazil, which announced the agreement in December 2017, taking over two developments of the type – one in Paraná and one in Ceará – whose original owners had faced financial difficulties and that still remain in the promise.
Today, nearly 6,000 shareholders share ownership of the resort in northern Paraná: among those who made the investment, uncertainty reigns as to when the hotel will be ready and a certain dismay with the acquisition.
Since the beginning of the partnership with Hard Rock, VCI has launched projects with the potential to generate BRL 8 billion in sales.
The company continues to sell hotel quotas in fractions (multiproperty) and set up a new operation in the capital market that intends to raise a total of R$ 607 million to finance the works.
The first phase of funding, of R$ 230 million, is already underway.
Despite the funds raised and the continuous flow of sales, customers have been complaining for months about the slow pace of progress of the works and the lack of accountability. “There are always people hammering there, breaking a wall here or there, but the way things are going, it takes more than 20 years to finish the work”, says a client who usually visits the site in Paraná and has been on the job for about two months.
But customer skepticism is not limited to complaints on social networks and consumer law bodies. It goes way beyond. Suspicions of irregularities fall on those responsible for the projects in two processes in the Securities and Exchange Commission (CVM)🇧🇷
Sought, the agency said it does not comment on ongoing processes. The suspicions raised by the market regulator are investigated by the Federal police and by Federal Public Ministry.
Sought, the company denies irregularities and claims that so far nothing has been proven in any instance, even after years of verification. He also maintains that part of the accusations refer to fundraising made by a former owner of one of the projects.
The company also said it had gone through five-month diligences and claims to believe in its acquittal in the CVM judgment, expected for December.
Wanted, the hard rock international stated that it monitors all phases of its business in the country. “Brazil is and will continue to be an important market for Hard Rock International,” the company said in a statement. The American chain also said that it will be responsible for the operation and management of the hotels in Paraná and Fortaleza. “VCI is the partner for the development, construction and sale of projects, in the multi-ownership model.”
Group says works will pick up pace in 2023
With hundreds of contracts rescission requests on the table due to delays in works, the VCI fund is rushing to give pace to its works.
In Paraná, according to the company, the number of workers in activity jumped from 114 to 240, with the expectation of reaching more than 600 in early 2023. Cearáthere are currently 608 workers, with the expectation of reaching over a thousand next year.
The evolution is accompanied by audits by the company Cushman & Wakefield, specialized in the real estate area. VCI also brought professionals with experience in the real estate market, such as CEO Fábio Villas-Bôas, formerly of Tecnisa.
Documents on the new funding of debentures inform that, in August, the works had an evolution of 33.8% in Paraná and 53.5% in Ceará.
The company alleges that it had to adapt to the standard of the international brand, including the demolition of existing parts and alleges that 46.44% of the work is completed in Paraná and 65.17% in Ceará.
The information is from the newspaper The State of S. Paulo.
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