Peer review of reports on EHT's Queen Mary in the works

Singapore

MORE clarity over the condition of Eagle Hospitality Trust's Queen Mary floating hotel is expected as soon as this month, when a peer review of the critical issues that were flagged in previous inspection reports is expected to be completed.

The City of Long Beach, which leases the retired cruise ship to the Reit, has hired an experienced local engineering firm to give a second opinion on the monthly inspection reports filed by long-time consultant Edward Pribonic, it said in a memo dated Nov 4 and released this week.

The review comes after Mr Pribonic wrote in August that the ship's condition was getting worse as a result of neglect, and that it might soon be "unsalvageable".

When this sparked a public outcry, City officials argued that the ship is far from unsalvageable, and that Mr Pribonic's language leans to the hyperbolic, according to reports from the Long Beach Post. The peer review will be completed this month, the City said.

Separately, the memo noted that ship operator Urban Commons, which is responsible for all ship repairs, had given the City a draft copy of its 2018 financial report, as per the City's request in an Oct 1 letter to the company.

The memo said: "Although the independent auditor notes concern about cash flow, liquidity, and overall debt load, the 2018 financial statement indicates a US$24 million (or 67 per cent) increase in revenue-generating activity within the (Queen Mary) lease area from the year before Urban Commons assumed responsibility for the lease.

"Reported revenue has increased from approximately US$36 million in 2015 to over US$60 million in 2019, reflecting substantial growth in activities and special events."

City staff are reviewing Urban Commons' financials and will meet Urban Commons staff once the analysis is complete, the memo said.

The memo also included a copy of a letter written by Urban Commons founder Taylor Woods in reply to the City. In the letter dated Oct 22, Mr Woods said Urban Commons has "learned a great deal" about the challenges associated with maintaining a historic asset such as the Queen Mary. Historic preservation will be costly, Mr Woods added: "It will require creative partnerships to develop the funding to make needed repairs."

On the whole, the City memo carried a positive tone. EHT units closed flat at 46 US cents on Thursday. Married trades included half a million units that crossed at 46.5 US cents, 3 million units that changed hands at 45.5 US cents and 5 million units at 44.5 US cents.

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