Strong turnout at the first 2019 ULI Caribbean Roundtable Panel.
Presentations by Emilio Colon Zavala, President of the Builders Association of Puerto Rico, Ricardo Alvarez Diaz of AD&V, Robbie Karver of EY and chaired by Adam Greenfader of AG&T. Big Shout out to Julie Medley, Mallory Baker, Max Helden and the whole ULI Southeast Florida team for putting this amazing event together.
Some of the biggest takeaways:
- Growth is forecasted at a 8.1% with growing airlifts. In spite of the tumultuous 2017 hurricane season, the occupancy rates were around 65% in 2018 and should peak back up to 70% across the region in 2019.
- Access, Access, and Access continues to be the principal driver for hospitality.
- “The Caribbean region today is seen as a maturing destinations with more diversified land offerings”, quoted Robbie Karver.
- Looming recession talks in US was downplayed for the Caribbean region as the lack of a significant of new supply (compared to 2008) should help bolster the region.
- Caution was noted about citizenship programs (CIP) for several Caribbean governments not necessarily generating revenues as expected.
- Smart money is looking at Puerto Rico with lots of incentives for tourism development, tax benefits for those wanting to move/start business on the island (law 20/22), and billions of dollars of recently approved US Federal grants. 95% of Puerto Rico is an Opportunity Zone.
- Institutional capital seeking better rates than on the US mainland although Caribbean hospitality lending is ‘cautiously optimistic’ with focus on shorter ramp up period of less than three (3) years.
- There is strong demand for world class Marinas and for Big-Big yachts.
- Resiliency is getting into new developments and is having very little negative effect on the IRR.
The roundtable conversation highlighted a series of events that will be taking place in 2019 (email email@example.com for a full schedule).
- MAY 2, ULI MEMBER APPRECIATION SOCIAL & POST TOA BAJA PANEL UPDATE (Puerto Rico).
- AUG 1 CARIBBEAN HOSPITALITY SUMMIT – PR BUILDERS (Miami)
- OCT 23-25 ULI Mexico – Latin America Conference (Cancun)
- NOV 14 PUERTO RICO BUILDERS ASSOCIATION CONFERENCE (Puerto Rico)
ULI will be highlighting development projects of excellence at its Annual Vision Awards Event which will be held on September 5that the JW Marriott Marquis. If anyone would like to submit a Caribbean project please contact Mallory.Barker@uli.org
For the next roundtable the following items were discussed as potential areas of interest:
- To discuss a list of hospitality projects that are getting funded in the Caribbean Region, share details on projects and the funding
- Bahamar project and case study
- Sources of hotel financing and the interplay of mezzanine financing
- The synergy of luxury cruise ships and private islands
- The business of Cannabis in the Caribbean
- The effect of Hurricanes on hotel supply and competition
- Sargassum seaweed and its adverse effects on the region
This first meeting was open to ULI members and guests. Subsequent roundtables will require membership for participation. Please email Max.Helden@uli.orgif you need details on joining.