THE Department of Public Lands is asking the Legislature for a favorable decision on the final draft of a proposed land lease agreement with E-Land Corp. involving publicly owned property in Marpi that used to be occupied by the now defunct Mariana Resort & Spa.
Under Public Law 15-2, the lease of more than five hectares of public land for commercial purposes requires the approval of three-fourths of the members of the Legislature in a joint session.
DPL initially awarded the Marpi property to E-Land four years ago after an evaluation team chose E-Land from among the six hotel investors that responded to DPL’s request for proposal on June 5, 2020. The other investors were Ocean Bee LLC, Marianas Global Inc., AMCON LLC, Hanmaek Saipan and IH Group.
However, what followed were four years of back-and-forth negotiations and hearings in the Superior Court after the Office of Attorney General cited deficiencies in the proposed land lease contract.
This prompted E-land to file a lawsuit, which ended up with the court giving DPL and E-Land an opportunity to work on “an acceptable solution.”
DPL took possession of the Mariana Resort & Spa after terminating its lease agreement with Kan Pacific more than four years ago.
On Tuesday, DPL Secretary Teresita A. Santos submitted to the offices of Senate President Edith Deleon Guerrero and Speaker Edmund S. Villagomez a packet of documents pertaining to a final proposed land lease agreement between DPL and E-Land.
Santos said E-Land, in its July 11, 2024, letter, had agreed with the terms and conditions that DPL and the OAG included in the final draft lease agreement, and would move forward with the final process of executing the lease contract on the Marpi property.
Santos said DPL is “extremely grateful for E-Land’s dedication and continued interest in leasing the property despite the current state of the economy. It is with this that I highly recommend and ask for your considerable favor in approving this lease.”
She added, “This lease comes forth with benefits for DPL and the CNMI, which include additional BGR tax collections, new improvements on the property increasing the value, public benefit contributions, and, most importantly, jobs for our people. DPL’s revenues have decreased significantly with low business gross revenue resulting in lower collections of BGR-based rents and several leases being canceled.”
Proposed lease terms
E-Land proposes to lease the 1.4 million-square meter property and operate a hotel there, including an 18-hole golf course, for 40 years, with an opportunity to apply for a 15-year extension.
E-Land will pay an annual rate of 5% of the fair market value throughout the term of the lease. In addition, E-Land will pay a percentage of its business gross receipts consistent with the rates required by DPL regulations.
The proposed lease agreement also requires E-Land to contribute a total of over $4 million in public benefits. These include:
1) Complying with all U.S. and CNMI labor laws to develop and implement a job training program in collaboration with government agencies, and provide management opportunities to encourage, induce and promote qualified U.S.-CNMI residents to positions within the operation and maintenance divisions.
2) Contribute $2.5 million toward funding infrastructure development for DPL’s homestead program in As Gonno, or as otherwise approved by DPL. This funding will be provided to the Commonwealth Utilities Corp. for the coordination and development of the project as detailed in the lease agreement.
3) Spending $1 million for the repair and upgrade of a public swimming pool.
4) Contributing $400,000 to the Department of Community and Cultural Affairs to use specifically for the development of a baseball field.
5) Spending over $2.8 million to build a facility dedicated as an education center for indigenous traditions and culture.
In addition, E-Land will invest a minimum of $220 million for the renovation of existing structures and new improvements on the former Mariana Resort & Spa premises.
