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Argentina – Controversy over hotel construction costs for Ansenuza Casino

By - 3 May 2016

The Lottery of Córdoba province has decided to terminate its contract with Pedraza Viajes the concessionaire of the Ansenuza Hotel Casino and Spa hours before local lawmakers were due to debate the issue over growing concerns over still unfinished work and costs.

Opposition members in the state legislature had called for precise details over costs as well as details over how the contract was initially awarded with the previous administration. In a statement the lottery said: “Given the remarks concerning the cost of the construction of the Hotel Casino Spa Ansenuza the Córdoba Lottery reports from information arising from the financial statements as of November 30 2015, which are duly audited and certified to the Professional Council of Economic Sciences, as stated in the Auditor’s Report dated February 24, 2016 that expenditures of that work stood at $335,903,115 pesos.”

The situation had become untenable due to the fact that said that Pedraza Viajes, had demanded that the lottery guarantee hotel occupancy and income amounting to a total of $650,000 pesos per month. “This is entirely unviable, so the Lottery of Córdoba has begun the process of disengagement with the current concessionaire,” the lottery said in a statement.

Meanwhile, a lottery spokesman explained that: “The current concessionaire offered to make investments to complete the second stage of the hotel (30 rooms) for the amount of $42.35m, an amount, which the Lottery would reimburse within 12 months from the completion of the work. Later and arguing that there had been changes in the costs of its construction, the licensee requested an increase, which would bring the work to a value of $59.29m. In this situation the Córdoba Lottery requested that the Department of Architecture of the Government of Córdoba put an evaluation on the work to be performed, and came to a final value of $43.34m.”

This difference of $16m in the price asked for by Pedraza Viajes, and the government’s estimated figures necessary to complete the project have caused tension between the concessionaire and the province and led to the lottery’s decision to terminate the contract.

The Ansenuza Hotel Casino and Spa in Miramar opened last November. The world-class venture has a modern casino, spa, golf course with nine holes, and overlooks the Mar Chiquita lagoon.

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