Puerto Rico’s hotel Industry takes centerstage this week in Miami.

 

 

 

Puerto Rico takes centerstage at the Caribbean Hospitality Investment Summit (CHRIS) held this week at the Hardrock Hotel in Miami.

 

The Puerto Rico Builders Association, one of the sponsors of the CHRIS event, was honored to congratulate Hugh Andrews, CEO, IHE as he received the Lifetime Achievement Award. The award was presented by Vanessa Ledesma Acting CEO and Director at Caribbean Hotel and Tourism Association.  Vanessa, herself a great friend and native of Puerto Rico, discussed with Hugh Andrews his vast accomplishments that include the development of such Icon hotel properties as the Conquistador Hotel, El Convento, Las Casitas, and Vanderbilt Hotel.

 

STR in its annual report, listed Puerto Rico’s year over year recovery from 2019 as one of the Caribbean’s  top destinations. This includes maintaining strong airlift throughout the pandemic, maintaining high ADRs, and an impressive 82% Occupancy rate. The recently delivered Aloft San Juan hotel was named as top CHRIS hospitality development of 2021.  Adam Greenfader, Managing partner of AG&T and Florida Liaison Chair of the Puerto Rican Builders Association,  spoke on the success of the P3 program in Puerto Rico. He mentioned in the Public-Private Collaboration panel that the island will be soliciting a P3 bid for the management of the 9 remaining local and national airports.

 

Kenny Blatt, Principal/Managing Partner of CPG Real Estate, spoke extensively on Puerto Rico’s hospitality industry. He discussed the island’s capacity to greatly expand its hospitality and tourism sectors.  Blatt’s was enthusiastic about the transformation at Dorado Beach, A Ritz-Carlton Reserve and its evolution since 1958.   His key takeaways on Dorado Beach’s success include working with local partners as a critical best practice. Blatt praised the Stubbe family and PRISA group repeatedly as “ the greatest developers any resort can ever have.”

 

The Puerto Rico Builders Association will be celebrating its 70 year anniversary at its upcoming conference on October 27-28, 2021. For more information visit https://constructorespr.com

 

State of the Caribbean Hotel Market

 
 
  
On Tuesday, March 16, 2021 at 10:30am, we held the ULI State of the Caribbean Market Place webinar. The event boasted some of the top industry leaders in finance, brokerage, and development on what’s happening in the Caribbean hotel market. Speakers included Juan Corvinas Solans, Rogerio Basso, Alexandra Lalos, and Christian Charre, and Brad Dean. Moderated by Adam Greenfader.  

 

Could this be the year for Puerto Rico?

Adam Greenfader
 
 

Could this be the year for Puerto Rico?

 

It had been almost 12 months since my last visit to Puerto Rico. Thanks to the COVID lockdown expectations were low. The last time I visited, more than 2 years after hurricanes Irma and Maria, the devastation was still overwhelming.  Streets were lined with garbage, electrical lines in disrepair, and thousands of homes had roofs covered in blue tarps. This combined with more than ten years of economic recession made has made Puerto Rico extremely pessimistic. As I landed in Luis Munoz Marin Airport, I was thinking,  “Would the ensuing earthquakes and COVID pandemic ravage the economy even more…”

 

I travelled the entire island from coast to coast –  100 x 35 miles, in a two week period. I drove from San Juan to Aguadilla, Mayaguez, Ponce, Humacao, Fajardo, and Ocean Park.  The roads were in good condition, the street lights working, and many buildings newly painted.  Notwithstanding the COVID crisis, the economy was bustling.  Most palpable was the positive attitude and feeling of the people. I spoke with many colleagues and friends and was told that much of the hurricane insurance had circulated through the economy.  The 8-12 billion in Federal relief from CDBG-DR is expected by early 2021.  Homemade signs seeking construction workers can be seen throughout the island that read, “Se Solicita Carpinteros y Albanilles”.

While the tourists were clearly absent ‘en mass’, a handful of new boutique hotels, especially in San Juan, have been recently delivered between 2019-2020. Much of this new hotel activity is due in part to the Tourism Tax Incentive. The tax incentive provides up to 40% of the total project’s cost back to sponsors…incredibly, some of it can be used for funding as part of the initial capital stack.  While this is not common anywhere in the world, Puerto Rico’s is not a typical Caribbean destination. The total economic activity (GDP) in Puerto Rico is less than 7% for all tourism related activities.  This includes, hotels, trades, conventions, excursions, etc..   This is an astonishing low number for an island that is surrounded by warm water, beautiful beaches, and lush landscapes. Read more about why Puerto Rico is like this at: https://agandt.com/contact-why-puerto-rico-now/

These tax incentives combined with a team of dedicated individuals in the Destination Marketing Organization (DMO) –  Discover Puerto Rico and other Public Private Partnerships (Invest Puerto Rico) is helping to make Puerto Rico a thriving tourism destination. The island currently boats some of the top hotels in the Caribbean with ADR’s over $1,500 per night.  Much of this demand is generated by the Act 20/22 (now Act 60).  For the last five years, hundreds of high net worth US individuals have moved to Puerto Rico to take advantage of zero Federal capital gains.  Act 60 has resulted in over 500 families and hundreds of new business moving to Puerto Rico.  There seems to be no end in sight for these new Americans living in Puerto Rico.  

Dorado Beach

This week Puerto Rico also inaugurated for the first time in over 20 years, the same political party. The PNP or US Statehood party won the election with a mandate for political stability, reduced corruption, and closer ties with the United States. While the island’s economic crisis is far from over, the COVID pandemic has put Puerto Rico back in the spotlight for its manufacturing proficiency. The island of Puerto Rico is one of the world’s leading pharmaceutical destinations – producing more than the top 5 US States combined. As thousands of jobs come back to the USA-Puerto Rico, invariably many will end up where the cost of labor is 15% less expensive, and there is a 60 year culture of robust manufacturing.

 

So is this the year for Puerto Rico?  Strong yes if you are involved with affordable housing, luxury resorts, alternative energy and critical manufacturing.

While we at AG&T do not have the proverbial ‘crystal ball’ on the island’s long term economic growth, things feel like they are on the right track and we will have more clarity with the resolution to the island’s bond crisis, the electrical authority privatization (AEE), and the completion of the responsibilities of The Fiscal Oversight and Managemnt Board for Puerto Rico. 

AG&T Joins Over One Thousand Leaders Across the United States Affirming Commitment to Global Climate Action

 

AG&T Joins Over One Thousand Leaders Across the United States Affirming Commitment to Global Climate Action on the Fifth Anniversary of the Paris Agreement 

 

Washington D.C. – December 12th marks the five-year anniversary of the world coming together to sign on to the Paris Agreement and AG&T is marking the moment by committing to a national mobilization for a clean energy economy and centering their own operations in pursuit of climate action. In doing so, AG&T joined over a thousand leaders from local governments, businesses, universities, and other institutions across the country as part of the “America Is All In” joint statement. 

This joint statement will be delivered to the incoming Biden-Harris administration, as well as to United Nations officials and global heads of state at the Climate Ambition Summit hosted by the United Kingdom, also on December 12th.  

 “As we look to recover from the dual public health and economic crises brought on by the COVID-19 pandemic, we also look to the looming threat of the climate crisis,” said Adam Greenfader. “This is a moment to foster innovation, increase national security, and protect the health and well-being of present and future generations. In our commitment to addressing the climate crisis, we at AG&T are all in and welcome the opportunity to do our part to achieve these goals and push for bold climate action across the United States.” 

The “America Is All In” declaration is organized by We Are Still In, a coalition in support for climate action and a pledge to uphold the United States commitments to reduce emissions under the Paris Agreement. With more than 3,900 organizations and institutions across all sectors of the United States, these leaders represent over half of the national population, nearly two-thirds of the economy, and more than half of the country’s emissions. While the United States officially exited the Paris Agreement on November 4th, the incoming Biden-Harris administration has committed to reentering the unprecedented global agreement.  

“December 12th is more than an anniversary of an agreement, it represents a critical turning point for the future of U.S. and global climate action,” said Elan Strait, Director of US Climate Campaigns at World Wildlife Fund (WWF). “Nationally, we have stumbled in our leadership on climate action. But We Are Still In shows that there was a commitment to change in the United States that never faltered. Today’s statement from AG&T and hundreds like them across the country sends a clear message that, moving forward, we need a unified national response to the climate crisis.”  

To date, the new statement has been signed by cities across the United States including St. Louis, Milwaukee, and Washington, DC, Fortune 100 businesses including Intel, Hewlett Packard, and McDonalds, and Michigan Governor Gretchen Whitmer.  

“There’s never been a more important time for us to come together and accelerate the progress we’ve made to address the climate crisis than now,” said Katie Fallon, Chief Global Impact Officer at McDonald’s. “At McDonald’s, we believe we have a special obligation to help the nearly 40,000 communities we serve build a more resilient and equitable future. This global pandemic is a needed wake-up call that there is still much work to be done, and that we can only succeed if we innovate and collaborate together – that is why we are still in.”

View the statement and signatories at AmericaIsAllIn.com

Learn more at WeAreStillIn.com 

 #WeAreStillIn, #AmericasPledge, #ParisAgreement, #TimetoAct, #ActOnClimate, #climatecrisis, #BuildBackBetter

ULI | Heitman Report

 

 

CLIMATE RISK AND REAL ESTATE

Excerpts from the 2020 ULI | Heitman Report.

ULI partnered with Heitman, a global real estate investment management firm, to assess the potential impacts of climate change on the long-term viability of real estate assets. Derived from a series of interviews with leading institutional investors, investment managers, investment consultants and others, the report provides members with an inside look at how real estate investors are factoring climate risk into their investment decision-making and management processes.

See full report at : https://knowledge.uli.org/en/Reports/Research%20Reports/2020/-/media/b81db4bbc77845f7834f24b0e974dd7a.ashx

ULI publishes this updated report amid a global pandemic and economic uncertainty. For many, it may feel as if the priority of addressing climate change is dissipating as we face the immediate challenge of COVID-19.  Although it is still too early to draw conclusions about the long-term implications of COVID-19 for our cities and the real estate industry, such a wide-scale humanitarian crisis throws the connections between environmental, social, and governance (ESG) issues and our economies into sharper focus.

However, just as the coronavirus has exposed many weaknesses, it has also shown us that we have the ability to adapt and change our behaviors quickly and radically.

Globally, most major economic hubs are in coastal, river delta, or other high-risk areas. These locations present many advantages, relating to connectivity, trade, quality of life and placemaking. These cities house more than half the global population, with much higher percentages of residents in some regions. About 80 percent of U.S. residents live in cities, for example, 39 percent of the European Union population lives in metro areas with 1 million or more inhabitants.

In 2020 (as of October 7), there have been 16 weather/climate disaster events with losses exceeding $1 billion each to affect the United States. These events included 1 drought event, 11 severe storm events, 3 tropical cyclone events, and 1 wildfire event. Overall, these events resulted in the deaths of 188 people and had significant economic effects on the areas impacted. The 1980–2019 annual average is 6.6 events (CPI-adjusted); the annual average for the most recent 5 years (2015–2019) is 13.8 events (CPI-adjusted).

Many of the most economically powerful coastal cities face significant climate risk. However, these cities offer some of the most attractive investment environments, meaning that the risk is worth the return. “We have a dilemma that some of the most attractive markets are also markets that are affected more by weather-related risks,” noted one real estate investment manager. However, a few investors indicated that they are beginning to suspend acquisitions or take steps to reduce their real estate footprint in city markets where they harbor climate-risk concerns. The phases after a big disaster, according to one interviewee, were to see the market buoyed up by subsidies and insurance, followed by rebuilding and speculative demand. This short-term “sugar high” of disaster support, insurance claims, and opportunistic investment likely masks underlying negative and fiscal impacts that could be exacerbated by future climate-related events (or other shocks).

The research found a number of misleading correlations, such as flooding having a positive impact on cash solvency and fiscal health, and hurricanes increasing budget solvency. However, the current model of contingencies will not be sustainable with the expected increase in the frequency and intensity of climate change impacts, as well as slow-moving stresses such as sea-level rise, which further exaggerate the effect of peak events. In other words, a weather-related event has not yet adequately “shocked” the system of contingencies as to break it. However, the COVID-19 crisis may prove to be the ultimate shock to the system that breaks it. What happens when that “extreme event” is no longer a geographically or temporally discrete event?

“There are three big mechanisms through which costs are likely to increase going forward: one is insurance, [and] the second area is . . . tax rates and the third is cost of financing as banks start to cost the added risk.

 BlackRock, the world’s largest asset manager, made headlines in January 2020 when Larry Fink, the firm’s CEO, stated in his annual letter on corporate governance that “climate change has become a defining factor in companies’ long-term prospects,” and “we are on the edge of a fundamental reshaping of finance.” The BlackRock announcement signified an increasing industry prioritization of climate change mitigation, or efforts to prevent or reduce greenhouse gas emissions.

Most interviewees also expressed overall uncertainty about future insurance prices and the likely market impacts of shifting insurance policy. In an extreme scenario, some investors envisioned a future in which properties could not qualify for insurance at all and therefore became ineligible for loans.   The annual insurance pricing structure can underpredict risk for longer hold periods, as well as for the underpinning infrastructure. The approach also assumes the long-term availability of underwriting capabilities, in terms of the affordability and availability of products. If sites are unable to obtain insurance, they will not be eligible for loans, leading to major potential valuation consequences.

Long-term focus: In lay terms, catastrophe models simulate “thousands of versions of next year,” not “thousands of successive years.”

All agreed that valuation is currently lagging behind recognition of climate risk and anticipate this changing in the near future. Valuation does not incorporate climate risks because it is “backward-looking”. Models typically do not allow a user to modify future climate conditions, and there are no established best practices to apply insights from climate science to catastrophic hazard risk modeling. Valuation has become more urgent for investors considering longer time horizons. Some investors have also informally discussed properties having “expiration dates” after which they may no longer be safe or suitable for residential or business use without extensive investment in surrounding infrastructure.

Anticipating steep declines in building value because of climate impacts runs counter to how buildings are currently valued. In the current model, value is derived from the residual value of the land and structure, plus discounted cash flows over time that drive net present value and cap rates. However, if dramatic changes lead the value of the structure and land to approach zero, cap rates would change significantly, with a steep decrease in value after purchase, and would need to be offset with increased cash flow and profitability to maintain net present value.

Several discussed efforts to design risk mitigation strategies for vulnerable assets and price these costs into deals. Some also spoke about resilient design as presenting opportunities to differentiate assets and enhance value. For example, one interviewee said they were exploring opportunities to create a “resilience zone” for entire neighborhoods.

Parametric insurance, where insurance payouts are linked to when predefined event parameters such as extreme weather events are met or exceeded, is an emerging option. Industry leaders note that parametric insurance may become more widespread, but it is not an appropriate solution for all scenarios. The Caribbean Catastrophe Risk Insurance Facility (CCRIF) is one example of a regional fund.  #heitman 

 

AG&T is committed to being part of the climate solution. AG&T joined over a thousand leaders from local governments, businesses, universities, and other institutions across the country as part of the “America Is All In” joint statement.  To learn more click here. 

Returns on Resilience in The Caribbean

ULi Speakers

Returns on Resilience 

As the world struggles to return back to normal from the Covid19 pandemic, environmental concerns continues to loom as an area of great concern for world and the Caribbean region in particular.   What strategies have institutional capital,  developers, reinsurance companies and owners in the Caribbean pursued to protect their properties from climate-related risks? Do these resilience investments make business sense as a development objective? What has the capital market response been? And how have developers and property owners measured their success? 

Speakers: 

Jan Raes, ABN AMRO  Global Sustainability Advisor  

Esteban Biondi, ATM Associate Principal

Koen Waterstudio NL, Co-founder

Adam Greenfader, AG&T, Managing Partner 

Topics to Include:

1. What is the capital doing about investing in resilient projects?

2. How are developers integrating resiliency practices into their projects?

3. The $ of Resiliency – Beyond the ULI Heitman Report

4. Aquatic Architecture: is it just a matter of Time?

 

To learn more about AG&T. 

 

New Hotel Announced in St. Maarten

Site Plan of Hotel

INDIGO BAY–Two prominent real estate development firms have partnered with Cay Bay Development (CBD) NV, the master developer at Indigo Bay Development, to propose the development of a US $220 million luxury hotel resort and condos in St. Maarten.  AG&T provided advisory services and a group of independent real estate brokers led by Adam Greenfader at Oceanfront International Group at Douglas Elliman coordinated the transaction. 

 

 

The proposed high-end hotel development at Indigo Bay Development,  is expected to feature certain luxury accommodations and five-star amenities, including 94 hotel rooms and suites, and 130 residential homes. Additionally, the proposed hotel development is expected to feature large water ponds and greenery areas in keeping with its eco-centric vision, as well as an extensive public parking area for public beach access to Indigo Bay.

  “The timing for such a development could not have come at a more opportune time, as country St. Maarten is tasked with creating new and innovative strategies to counter the global economic crisis due to the pandemic,”.

In an economy whereby hospitality and tourism are at the centre of its recovery, it is expected that the development of a high-end branded hotel in St. Maarten would provide an enormous boost to this endeavour by enhancing several areas in tourism.

 

Hotel Concept at Indigo Bay

 

According to the release it can enhance St. Maarten’s global attractiveness as a prime tourist destination; increase hotel accommodation by approximately 20 per cent; increase the number of annual visitors to St. Maarten by 32,000 based on hotel occupancy of 65 per cent (double) and an average stay of five nights; and attract high value tourists who may choose St. Maarten as a vacation destination as opposed to accessing surrounding islands through its air and sea ports of entry, it was stated in the release.

The proposed world-class hotel development, once completed, will be managed by an internationally-recognised hotel brand, which will lend itself to greater global recognition, the release said. The projected marketed average daily rate (ADR) for hotel rooms at the proposed new hotel development is expected to be substantially higher than the current average daily rates on St. Maarten.

The CBD and the principals of the proposed hotel development seek to assure that the interest of the citizenry and of the environment are paramount to their endeavor.  Six acres of the overall hotel site of about 18 acres is projected as a green zone, including the retention ponds that were originally constructed at Indigo Bay Development by CBD. 

For more information about Caribbean hotel opportunities contact us 

Q & A: A SPOTLIGHT ON COSTA RICA

CHRIS AND HOLA: A SPOTLIGHT ON COSTA RICA 

Adam Greenfader, Managing Partner, AG&T, Raul F. Calvet, Moderator

 

ADAM- A“Big shout out to everyone at CHRIS and HOLA for putting on this amazing virtual event, The Puerto Rico Builders Association for Sponsoring, and Oceanfront International Group.” 

Q- What do hotels need to do in order to go through the recovery period?

ADAM – Costs have already been cut. So now it’s time to increase revenues.  I think the key will be to help guest feel safe. There is a huge pent up demand. In particular for anything that makes people feel good, for “Regenerative Experiences”.  Places like Costa Rica with its low density and robust nature-centric offering should fare well post COVID.  Incredibly, the average stay in Costa Rica is 12 days. When you look at their secret, it is based on a diversified ecological travel experience.

Q- How are you monitoring the US economy? 

ADAM – Confidence = Jobs.  The unemployment is still at 10.2%, which is near post-war highs across the country.  We are also keeping an eye on inflation and deflation. I recently traveled across 10 States in the USA and visited many hotels with reduced ADR’s – deflation.  I ordered food from restaurants that was 30% more expensive than before COVID19 – Inflation.

Q- Are the Banks exerting pressure to sell?

ADAM- We are still in the honeymoon phase. We expect to see some distressed assets come to market in 2021 in Central America. However, because the region’s hotels have generally less debt than in US, we may not see as much distressed inventory as a CMBS loan portfolio for example.

Q- How are the REITS doing in the US?

ADAM- Real Estate Investment Trusts (REITs) collectively own about $3 trillion in assets across the US. The REITs own, operate, or finance income-producing real estate ventures.  REITs Hospitality is currently at -14% with Industrial remarkably at a positive 8%.+

Q- What regions should be first to recover from the COVID19 Pandemic?  

ADAM – Costa Rica has a highly educated workforce and stable government. By almost any standard, Costa Rica has one of the best health care systems in Latin America.  Incredibly, Costa Rica exports as much in medical devices as it does fresh bananas. Costa Rica’s quality of life is evidenced by topping the Happy Planet Index rankings to #1. Costa Rica is one of the world’s leading nations for ecological sustainability and a Blue Zone (only 6 in the whole world)!

Q- How important are airports for the hotel industries recovery?

ADAM- Airports are critically important to recovery.  Today more than ever, as tourists come back to Central America, they will be looking for

  • health and safety
  • ease of access (flights + affordable costs)
  • air conditioning

One of my favorites is Liberia Airport. LIR is one of the top Airports in all of Latin America and the Caribbean. More than 3 Million tourists travelled to Liberia airport (LIR) in 2019 with 65 flights from the USA daily.  The airport is small, modern, and full Americans dressed in Patagonia and Lululemon. “It feels like Burlington, Vermont.”

Q- How feasible is to reconvert an hotel into other use?

ADAM- In the last crisis, we saw a lot of conversions from office to residential. Today, we have a huge need to increase the wellness element of hotels.

Q- How do you value a hotel asset in today’s world?

ADAM- Discount Cash Flows (DCF) are the only way to quantify a value. This is even more true today in the COVID 19 pandemic where sales are scant.

Q- Where do you see Costa Rica’s Development opportunities in the near future?

ADAM- We like the Papagayo region where ADR and occupancy rates are the highest in the country and probably in Latin America.  Costa Rica has incredibly 12 day average stays with a reported 30% retention rate of tourists.  They come back.  As a Blue Zone, most of the Papagayo peninsula is protected. We found this eco-development that is located only 20 minutes by car from the LIR airport. Hacienda del Mar is an absolute paradise.  There are plans to build a Blu Zone hotel with 100% of its infrastructure complete. The project has lots of room to grow and we are seeking like-minded partners.

Critical Manufacturing and Puerto Rico USA

Luis Fortuno and Congresswoman Jennifer Gonzalez

¨.

The panelists :

 

 

 

The ULI Webinar has an incredible array of information crammed into 90 minutes and it gives a great snapshot for the many initiatives being introduced and planned to help the Puerto Rican economy and create more quality jobs. If I had to some it up in three words, Mo is back. Mo of course being momentum.

 Each of the speakers brought a different perspective. Congresswoman Gonzalez Colon noted her primary mission is the reconstruction of the Island and to shephard the many supporting bills recently introduced in the US Congress. Former Governor Luis Fortuno brought an informed Wash DC think tank perspective, Adam Greenfader is one of Puerto Rico´s most passionate advocates, Andy Carlson of JLL (Jones Lang LaSalle) brings experienced commercial  insights from the world´s second largest public brokerage firm, Dr Deusch stated his case for the reasons he brought his Swiss/German manufacturing business to Puerto Rico because of a need for precision and reliability, while Noel Zamot has a finger on the ethical pulse of developing new business in Puerto Rico.

The conversations were upbeat and positive. For instance, Congresswoman Colon made a presentation on MMEDS which was introduced last month to Congress under the bill H.R. 7527. This bill provides tax incentives and tax credits for companies creating manufacturing plants and jobs in economically distressed areas in the US and its territories. The criteria for distressed is even stricter than the recent Opportunity Zone legislation passed in late 2017. When the Congresswoman showed the MMEDS qualifying maps there were smaller areas in very non desirable locations in the US whereas Puerto Rico literally had a much larger proportional area in some desirable locations. And she stated very clearly that MMEDS is one of the very few legislative items that is drawing bi-partisan support from both sides of the aisle.

The entire panel then weighed in on the competitive advantages that Puerto Rico has when competing with the mainland U.S. including much lower labor costs by as much as 60% lower in some cases, an experienced manufacturing labor force going back 100 years, the University of Puerto Rico at Mayaguez which is a top 10% engineering school for the entire U.S. and which is very much geared to provide the engineering and chemistry talent to support Puerto Rico´s manufacturing base. That even today five of the top ten selling drugs internationally are produced in Puerto Rico and 12 of the top 20 pharmaceutical companies have plants in Puerto Rico. Luis Fortuno noted that Puerto Rico had more than $40 billion USD in pharmaceutical exports in 2019 but has the capacity to increase this substantially. The panel noted that some closed down plants are almost in turnkey conditions should manufacturers wish to return or expand capacity. It would not take much. Maybe a recession of the Jones Act, or at least an exemption for an extended period of time, might be the necessary catalyst. There are some interesting new developments on this front as was evidenced last week by Hawaii noting that 85% of their informed populace is all for rescinding the Jones Act as it costs that Island 1.2 billion USD in additional transportation and cost of goods fees.

Progress is being made on seeking some type of exemption under the taxing provisions of GILTI as it adds a 10%+ tax on profits for CFCs (controlled foreign corporations) which unfortunately applies to the US territories since the do not fall under the IRC (Internal Revenue Code). On May 1, 2020, Congresswoman Stacey E. Plasket, representing the US Virgin Islands, filed Bill HR 6648 – the Territorial Economic Recovery Act, that if becomes law, it will exclude our territories from much or all of the GILTI taxation, under certain provisions.

On April 3, 2020, Congresswoman Jennifer González, resident Commissioner for Puerto Rico, introduced Bill HR 6643, the Securing National Supply Chain Act of 2020, to provide various tax credits to Economically Distressed Zones, including a tax credit on the amount of wages paid by an employer to employees in such a zone. The proposal has some overlap with HR 7527 noted above.

President Trump’s Special Representative for Puerto Rico’s Disaster Recovery,  Rear Admiral Peter Brown, lead two delegations to Puerto Rico in August 2020, the last visit being last week. I am told the trip was very successful as a big priority was to visit and understand the many advantages of pharmaceutical manufacturing in Puerto Rico.  AG&T is committed to bringing our network top information and access to our industry’s leaders.