Investing Through Uncertainty: Institutional Capital’s View of Caribbean Hospitality During COVID-19

Investing Through Uncertainty: Institutional Capital's View of Caribbean Hospitality During COVID-19

 

At the height of the COVID-19 pandemic, uncertainty gripped the global hospitality industry.

Hotels throughout the Caribbean stood nearly empty. International travel had come to an unprecedented halt. Lenders were reassessing risk, investment activity had slowed dramatically, and developers around the world were asking the same question:

What does the future of hospitality look like?

To help answer that question, AG&T and the Urban Land Institute (ULI) Caribbean Roundtable hosted a timely conversation with Nicholas Hecker, Executive Managing Director and Chief Investment Officer of Sculptor Real Estate, moderated by Adam Greenfader, Chairman of AG&T and former Chair of the ULI Caribbean Council.

The discussion provided a rare institutional perspective during one of the most uncertain periods the hospitality industry had ever experienced.

Looking Beyond the Crisis

While much of the industry focused on immediate operational challenges, the conversation explored a much broader question:

How do long-term institutional investors evaluate hospitality during periods of extreme uncertainty?

Nicholas Hecker shared insights into how sophisticated investment managers distinguish between short-term market disruption and long-term value creation. Rather than reacting solely to the immediate crisis, institutional investors continued to evaluate demographic trends, destination quality, replacement costs, barriers to entry, and the long-term fundamentals supporting hospitality investment.

The message was clear.

The pandemic represented an extraordinary disruption—but not the end of the hospitality industry.

Confidence in Caribbean Hospitality

The Caribbean entered the pandemic with some of the strongest tourism fundamentals in the world.

Exceptional natural assets, limited beachfront supply, growing global demand for experiential travel, and proximity to North American markets continued to make the region attractive from a long-term investment perspective.

The discussion emphasized that while transaction activity had slowed, high-quality destinations would likely recover first as travelers increasingly sought open-air environments, wellness experiences, and lower-density resort communities.

Many of those observations proved remarkably accurate.

In the years that followed, the Caribbean experienced record tourism recovery, rising average daily room rates, increased luxury development, and renewed institutional investment.

Institutional Capital Today

Since that conversation, Sculptor Real Estate has continued to expand one of the world’s leading alternative real estate investment platforms.

Today, the firm has raised approximately $14.5 billion in capital across opportunistic equity, credit, and long-term investment strategies, with investments representing more than $30 billion in enterprise value across hospitality, resorts, gaming, marinas, specialty real estate, infrastructure, and other alternative asset classes.

The firm’s continued focus on experiential real estate reflects growing institutional confidence in sectors closely aligned with the Caribbean’s long-term strengths.

AG&T’s Commitment to Industry Leadership

One of AG&T’s objectives throughout the pandemic was to ensure that Caribbean developers, investors, lenders, and hospitality professionals remained connected to the world’s leading thinkers.

Rather than allowing uncertainty to halt the conversation, AG&T organized a series of virtual discussions featuring executives from global investment firms, hotel brands, multilateral development banks, tourism organizations, lenders, and government agencies.

These conversations helped industry participants better understand how global capital was responding to unprecedented market conditions while providing valuable insights into the recovery that would eventually follow.

Looking Back

Viewed today, this discussion serves as an important historical snapshot. It captured institutional thinking at one of the most uncertain moments in modern hospitality history.

More importantly, it demonstrated that experienced investors were already looking beyond the immediate crisis and focusing on the long-term fundamentals that continue to drive Caribbean tourism today.

For AG&T, the conversation reinforced a principle that has guided our work for more than three decades:  Markets experience cycles. Hospitality evolves. Capital adapts.

But exceptional destinations supported by thoughtful planning, resilient infrastructure, and long-term vision continue to attract investment.

The Caribbean’s recovery over the past several years has validated that perspective—and positioned the region for a new generation of hospitality investment.

Caribbean Banking Leadership During the COVID-19 Pandemic

Isabel de Caires

Caribbean Banking Leadership During the COVID-19 Pandemic

 

During the unprecedented disruption of the COVID-19 pandemic, Caribbean financial institutions faced one of the most significant challenges in their history. With tourism at a standstill, hospitality assets under pressure, and uncertainty across virtually every sector of the regional economy, banks were required to move beyond traditional lending practices and work collaboratively with borrowers to preserve long-term value.

In this exclusive interview, Isabel de Caires of FirstCaribbean International Bank shares how regional lenders responded during the crisis, implementing payment deferrals, restructuring loans, reducing costs, and working alongside clients to help businesses navigate an extraordinary period of uncertainty.

One of the most important lessons from the pandemic was the willingness of Caribbean banks to cooperate—not only with borrowers, but with one another and with governments—to maintain financial stability across the region. That collaborative approach helped many projects survive a period that few could have anticipated.

For AG&T, these conversations reinforced the importance of maintaining strong relationships throughout the Caribbean banking community. Over more than three decades, we have worked closely with regional and international financial institutions, giving our clients valuable insight into evolving lending practices, capital markets, and financing strategies across multiple jurisdictions.

Whether structuring development financing, introducing lending partners, or advising on capital formation, AG&T’s longstanding relationships with Caribbean financial institutions provide clients with access to market intelligence that extends well beyond individual transactions.

Watch the interview with Isabel de Caires to learn how Caribbean banks responded during one of the region’s most challenging periods and how those lessons continue to influence lending and development today.

 

Are Hotels Coming Back to The Caribbean?

Are Hotels Comming Back Caribbean

The Future of Caribbean Hospitality: Are Hotels Coming Back?

The COVID-19 pandemic brought the global hospitality industry to an unprecedented standstill. International travel halted almost overnight, hotel occupancies reached historic lows, and owners, operators, lenders, and investors were forced to rethink nearly every aspect of the business. For the Caribbean—a region where tourism is one of the primary drivers of economic growth—the stakes could not have been higher.

Recognizing the need for informed dialogue during this period of uncertainty, AG&T partnered with the Urban Land Institute (ULI) Caribbean Council to convene some of the hospitality industry’s most respected leaders for an important discussion: “Are Hotels Coming Back to the Caribbean?”

The objective was not simply to forecast a recovery, but to examine how the hospitality industry was adapting, where capital was flowing, and what opportunities would emerge as travel eventually returned.

The panel brought together an exceptional group of industry leaders representing every major segment of the hospitality ecosystem:

  • Adam Greenfader, Managing Partner, AG&T

  • Alejandro Zozaya, Executive Chairman, Apple Leisure Group

  • Christian Charre, Senior Vice President, CBRE Hotels

  • Chris Cylke, Chief Operating Officer, REVPAR International

  • Nicholas Hecker, Executive Managing Director & Chief Investment Officer, Sculptor Real Estate

Together, the panel offered perspectives from development, hotel operations, institutional investment, brokerage, valuation, and lending—providing one of the most comprehensive discussions on the future of Caribbean hospitality during one of the industry’s most challenging periods.

 

Three Questions That Defined the Recovery

 

1. What hotel transactions were taking place during the pandemic?

While many investors initially adopted a wait-and-see approach, the panel observed that sophisticated capital was already positioning itself for the recovery. Institutional investors, private equity firms, and opportunity funds were actively evaluating distressed assets, recapitalizations, and long-term acquisition opportunities throughout the Caribbean.

Rather than signaling a collapse in the hospitality sector, transaction activity reflected a repricing of risk and the belief that Caribbean tourism fundamentals would ultimately remain strong.

2. Would the industry experience widespread defaults, acquisitions, and repurposing?

The discussion acknowledged that financial stress was inevitable across portions of the market. However, the panel emphasized that not every hotel would face the same outcome.

Well-capitalized owners, strong brands, and institutional-quality assets were expected to recover more quickly, while other properties would require recapitalization, repositioning, or new ownership. Some hotels would be converted to alternative uses, while others would emerge stronger through strategic renovations and operational improvements.

History has since shown that many of these observations proved remarkably accurate. Although select assets changed hands, the Caribbean avoided the wave of distressed sales that many had feared, as tourism rebounded faster than most analysts had predicted.

3. How was the hospitality industry preparing for Travel 2.0?

Perhaps the most forward-looking conversation centered on how hotels would evolve beyond the pandemic.

Panelists discussed enhanced health and safety standards, contactless technologies, digital guest experiences, flexible operating models, wellness programming, outdoor amenities, sustainability initiatives, and changing traveler expectations.

The consensus was clear: recovery would not simply mean reopening hotels. It would require reimagining the guest experience.

Many of those innovations—from mobile check-in and wellness-focused programming to experiential travel and flexible resort design—have since become permanent features of the hospitality landscape.

 

A Defining Moment for Caribbean Hospitality

Looking back, this conversation represented more than a discussion about surviving a crisis. It marked the beginning of a broader conversation about the future of Caribbean tourism.

The region has since experienced one of the strongest tourism recoveries in the world. Visitor arrivals have surpassed pre-pandemic levels in many destinations, international hotel brands continue expanding throughout the Caribbean, branded residences have become one of the fastest-growing hospitality segments, and institutional capital has returned with renewed confidence.

The long-term fundamentals discussed during the panel—limited beachfront supply, strong leisure demand, expanding luxury travel, and the Caribbean’s enduring global appeal—have continued to support investment throughout the region.

AG&T’s Commitment to Industry Leadership

At AG&T, we believe our role extends beyond advising development projects.

For more than three decades, we have worked to convene conversations that bring together investors, developers, hotel operators, lenders, government officials, and industry organizations to address the opportunities and challenges shaping Caribbean real estate and hospitality.

Through our partnerships with the Urban Land Institute, Bisnow, the Puerto Rico Builders Association, universities, and other industry organizations, AG&T has helped create forums where ideas become strategies and relationships become investments.

The discussion, Are Hotels Coming Back to the Caribbean?, reflected that commitment.

It demonstrated that meaningful leadership is not only about responding to change—it is about helping define what comes next.

As Caribbean hospitality continues to evolve, AG&T remains committed to fostering the dialogue, partnerships, and investment strategies that will shape the region’s next generation of world-class destinations.

Hospitality Innovation in Times of Crisis: Lessons from IDB Invest and the Future of Caribbean Tourism

Rogerio Bass

Hospitality Innovation in Times of Crisis: Lessons from IDB Invest and the Future of Caribbean Tourism

Hospitality Innovation in Times of Crisis: Lessons from IDB Invest and the Future of Caribbean Tourism

As the COVID-19 pandemic swept across the globe, few industries were impacted more dramatically than hospitality and tourism. Borders closed, airlines grounded fleets, conferences were canceled, and hotels that once operated at record occupancies suddenly found themselves with little to no demand.

For Latin America and the Caribbean—regions where tourism serves as a critical engine of economic growth, employment, and foreign investment—the implications were profound.

To better understand the challenges facing the industry and the opportunities that could emerge from the crisis, the Urban Land Institute Caribbean Council hosted a conversation between Rogerio Basso, Head of Tourism at IDB Invest, and Adam Greenfader, Chair of the ULI Caribbean Council and Managing Partner of AG&T.

While much of the discussion focused on the immediate impact of the pandemic, the conversation ultimately became a broader examination of innovation, leadership, capital markets, and the future evolution of hotel management throughout Latin America and the Caribbean.

The Tourism Industry Before COVID-19

Before the pandemic, hospitality was experiencing one of the strongest periods in its history.

Global travel demand continued to expand, international tourism arrivals were reaching record levels, and investors remained highly attracted to hospitality assets throughout the Caribbean and Latin America. Major hotel brands were expanding aggressively, new resort developments were under construction, and institutional capital was increasingly targeting hospitality as a long-term growth sector.

Destinations throughout the Caribbean benefited from growing airlift, rising visitor expenditures, and increasing demand for experiential travel, wellness tourism, luxury resorts, and branded residential products.

According to Rogerio Basso, the industry’s fundamentals entering 2020 were exceptionally strong.

What followed was not a traditional economic downturn or cyclical correction. It was a sudden and complete interruption of global mobility.

Why This Crisis Was Different

The hospitality industry has weathered numerous crises over the past several decades, including recessions, geopolitical conflicts, natural disasters, and health emergencies.

COVID-19 was fundamentally different.

Unlike previous downturns that impacted specific regions or market segments, the pandemic affected virtually every tourism destination simultaneously. Hotels were not competing for reduced demand; in many cases, demand simply disappeared.

For owners and operators, the challenge was unprecedented. Revenue declined almost immediately while many fixed costs remained. Management teams were forced to make difficult decisions regarding staffing, operations, capital expenditures, and long-term strategy.

Yet amid the disruption, Rogerio emphasized that hospitality leaders could not simply focus on survival. They also needed to prepare for recovery.

Innovation as a Competitive Advantage

One of the most important themes that emerged during the discussion was the role of innovation in hotel management.

The pandemic accelerated trends that had already begun transforming hospitality, forcing operators to adopt new technologies and rethink traditional business models at a much faster pace.

Hotels across the region began implementing:

  • Contactless check-in and check-out systems

  • Mobile guest communication platforms

  • Digital concierge services

  • Enhanced health and sanitation protocols

  • Flexible staffing models

  • Advanced revenue management systems

  • Data-driven guest personalization

  • Hybrid meeting and conference capabilities

  • Expanded outdoor experiences and wellness programming

Many of these initiatives were initially introduced as crisis-response measures. However, they quickly evolved into permanent operational improvements that enhanced both efficiency and guest satisfaction.

The discussion highlighted an important reality: innovation is often accelerated during periods of disruption.

The hospitality companies that adapted fastest were frequently the ones best positioned to capture demand when travel resumed.

The Evolution of Hotel Management

Perhaps one of the most significant lessons from the pandemic was the changing role of hotel management itself.

Historically, hotel operators focused primarily on maximizing occupancy, controlling expenses, and maintaining service standards. Today’s hospitality leaders must balance a much broader range of responsibilities.

Modern hotel management increasingly requires expertise in:

  • Technology integration

  • Sustainability initiatives

  • Wellness programming

  • Community engagement

The panel discussed how successful operators would need to become more agile, more data-driven, and more responsive to changing guest expectations than ever before.

Hotels are no longer simply places to stay. They are becoming platforms that integrate hospitality, wellness, residential living, experiences, technology, and community.

This transformation is particularly relevant in the Caribbean, where travelers increasingly seek authentic experiences, environmental stewardship, cultural immersion, and personalized service.

The Role of Multilateral Development Banks

A unique aspect of the discussion focused on the role of multilateral development banks (MDBs) in supporting tourism and hospitality during times of crisis.

As Head of Tourism at IDB Invest, Rogerio Basso oversees initiatives that provide financing solutions throughout Latin America and the Caribbean. These include debt, mezzanine financing, equity investments, and other instruments designed to support sustainable development.

Multilateral institutions play a critical role because they often provide patient capital during periods when traditional financing becomes scarce.

Beyond capital, organizations such as IDB Invest contribute technical expertise, environmental standards, governance frameworks, sustainability initiatives, and strategic guidance that strengthen projects over the long term.

The discussion emphasized that recovery would require collaboration among governments, hotel operators, developers, lenders, investors, and development finance institutions.

No single stakeholder could solve the challenges alone.

Three Strategic Actions for Hospitality Leaders

Rogerio outlined several priorities that hospitality companies should consider when navigating periods of uncertainty:

1. Preserve Liquidity

Cash management becomes paramount during periods of disruption. Organizations must maintain financial flexibility to withstand market volatility while preserving their ability to invest when opportunities emerge.

2. Continue Investing in Innovation

The temptation during a crisis is to cut spending across all areas. However, technology, operational improvements, and guest experience enhancements often generate long-term competitive advantages that outlast the crisis itself.

3. Focus on Long-Term Demand Drivers

While short-term conditions may fluctuate, the fundamental drivers of tourism—human connection, exploration, business travel, leisure experiences, and cultural exchange—remain intact.

The strongest organizations maintain a long-term perspective even during periods of uncertainty.

Looking Back: From Crisis to Transformation

Several years later, many of the observations discussed during this ULI Caribbean Conversation proved remarkably accurate.

Tourism throughout the Caribbean and Latin America rebounded faster than many analysts expected. Luxury travel accelerated. Wellness tourism expanded. Branded residences became one of the industry’s fastest-growing segments. Technology adoption increased dramatically. Investors returned to the sector with renewed confidence.

Most importantly, hospitality emerged stronger, more resilient, and more innovative than before.

AG&T’s Commitment to Hospitality Thought Leadership

At AG&T, we believe that some of the most important conversations occur during periods of uncertainty. Throughout the pandemic and beyond, we partnered with the Urban Land Institute Caribbean Council to bring together industry leaders, investors, developers, hotel operators, economists, and policymakers to discuss the future of Caribbean real estate and hospitality.

Our conversation with Rogerio Basso was more than a discussion about crisis management. It was a dialogue about leadership, innovation, and the future of tourism in Latin America and the Caribbean. The lessons remain relevant today.

Hospitality is no longer defined solely by buildings, brands, or locations. It is increasingly defined by adaptability, technology, sustainability, and the ability to create meaningful experiences for guests. As the Caribbean continues its hospitality renaissance, innovation in hotel management will remain one of the most powerful drivers of long-term success. At AG&T, we remain committed to advancing the conversations that help shape that future.

Caribbean Hospitality After COVID: Reimagining Travel for a New Era

Headshot of Brad Dean

Caribbean Hospitality After COVID: Reimagining Travel for a New Era

In the spring of 2020, the global hospitality industry came to an abrupt halt.

Borders closed. Airlines grounded their fleets. Cruise ships sat idle. Hotels that had welcomed guests for generations suddenly stood empty. For a region where tourism represents one of the largest contributors to GDP, employment, and foreign investment, the uncertainty was unlike anything the Caribbean had ever experienced.

While much of the industry focused on managing the immediate crisis, AG&T believed it was equally important to begin asking a different question:

What would Caribbean hospitality look like after COVID?

To help answer that question, AG&T partnered with the Urban Land Institute Caribbean Council to launch a series of thought leadership conversations featuring many of the region’s leading voices in tourism, finance, hospitality, manufacturing, and economic development.

One of the most memorable discussions featured Brad Dean, then CEO of Discover Puerto Rico, Puerto Rico’s Destination Marketing Organization.

Rather than focusing solely on the challenges of the pandemic, the conversation explored how the industry could emerge stronger, more resilient, and better prepared for the future.

Brad Dean offered a perspective that has become increasingly relevant in the years since.

“This downtime gives the travel industry our George Bailey moment. We have all seen that without travel it’s pretty ugly. There is far greater value to travel than most of us ever realized. Travel lifts spirits. It connects people. It leads to progress.”

Those words resonated deeply throughout the Caribbean.

Travel is more than hotel occupancy or airline arrivals. It supports small businesses, restaurants, taxi drivers, artisans, tour operators, construction workers, architects, engineers, farmers, entertainers, and countless entrepreneurs whose livelihoods depend upon a vibrant visitor economy.

The pandemic reminded us that hospitality is not simply an industry—it is an ecosystem.

Creating Dialogue During Uncertainty

Throughout the pandemic, AG&T recognized that one of the greatest needs facing the Caribbean was the exchange of ideas.

As uncertainty grew, we brought together leaders from government, international finance, hospitality, manufacturing, infrastructure, and development to discuss not only recovery, but the long-term future of the region.

These conversations explored topics including:

  • The future of Caribbean hospitality

  • Tourism recovery strategies

  • Public-private partnerships

  • Sustainable destination development

  • Capital markets and investment

  • Resilient infrastructure

  • Manufacturing and supply chains

  • Puerto Rico’s role within the U.S. economy

  • The evolution of luxury hospitality

The objective was never simply to host webinars.

It was to create a forum where industry leaders could share ideas, challenge conventional thinking, and help shape the future of Caribbean development.

From Recovery to Renaissance

Looking back, many of the themes discussed during those early conversations proved remarkably accurate.

The Caribbean has experienced one of the strongest tourism recoveries anywhere in the world. Puerto Rico has reached record visitation levels, international hospitality brands continue expanding throughout the region, luxury resort development has accelerated, and institutional investment has returned to Caribbean hospitality with renewed confidence.

Today’s hospitality industry is fundamentally different from the one that entered 2020.

Developers place greater emphasis on wellness, sustainability, outdoor experiences, resilient design, mixed-use destinations, branded residences, and authentic cultural experiences. Investors have also recognized that the Caribbean’s long-term fundamentals—including strong tourism demand, limited luxury inventory, and growing global interest in experiential travel—remain exceptionally compelling.

AG&T’s Commitment to Caribbean Thought Leadership

For AG&T, these conversations reflected our broader mission.

As a Caribbean real estate development and capital advisory firm, we believe that leadership means more than executing successful projects. It means creating opportunities for dialogue, sharing knowledge across markets, and connecting investors, developers, hospitality brands, government leaders, and financial institutions throughout the Caribbean and the mainland United States.

Whether through our work with the Urban Land Institute, partnerships with Bisnow, industry conferences, investor forums, or conversations with leaders such as Brad Dean, AG&T remains committed to advancing ideas that strengthen Caribbean hospitality and encourage long-term investment across the region.

The pandemic tested every assumption about travel.

It also reminded us why travel matters.

Because hospitality is ultimately about people—and the connections that bring communities, cultures, and economies together.

 

Manufacturing 2.0 with Manuel Laboy

Puerto Rico's Economic Transformation: A Conversation with Secretary Manuel Laboy

 Economic development is driven by leadership, vision, and the ability to anticipate where investment is heading.

 

In this exclusive interview, Manuel Laboy, then Secretary of the Puerto Rico Department of Economic Development and Commerce (DEDC), shares his vision for positioning Puerto Rico as one of the most competitive jurisdictions in the Americas for manufacturing, life sciences, logistics, and industrial investment.

Our discussion explores many of the initiatives that were reshaping Puerto Rico’s economy, including the expansion of pharmaceutical and medical device manufacturing, Opportunity Zones, public-private partnerships, tax incentives, infrastructure investment, and regulatory reforms designed to attract new private capital. Secretary Laboy also discusses the significance of new legislation affecting foreign cargo and why he viewed it as a potential game changer for the island’s long-term competitiveness.

For AG&T, interviews such as this are part of our ongoing commitment to understanding the policies, market dynamics, and public-sector initiatives that influence real estate and economic development throughout the Caribbean.

Our longstanding relationships with government leaders, institutional investors, developers, and financial institutions allow us to provide clients with perspectives that extend beyond individual transactions. By engaging directly with the people shaping economic policy, we help clients better understand the opportunities, challenges, and strategic direction of the markets in which they invest.

Whether advising on industrial development, mixed-use projects, hospitality, or large-scale investment opportunities, AG&T believes informed decisions begin with informed conversations.

Watch the interview with Secretary Manuel Laboy to gain insight into Puerto Rico’s economic development strategy and the policies that continue to influence investment across the island.

Section 936 and the Case for Reinvesting in Puerto Rico’s Manufacturing Base

Zaida Feliciano Queens College

Section 936 and the Case for Reinvesting in Puerto Rico’s Manufacturing Base

 

The repeal of Section 936 remains one of the most consequential economic policy decisions of the last three decades. It hollowed out Puerto Rico’s manufacturing base, precipitated a fifteen-year economic crisis on the island, and — critically for U.S. supply chain security — pushed critical manufacturing offshore to Mexico, Ireland, Latin America, and China.

Understanding this history is essential to understanding the opportunity Puerto Rico presents to institutional capital today.

What Section 936 Was

Section 936 of the U.S. Internal Revenue Code, enacted in the 1970s, provided federal tax credits to U.S. corporations operating in Puerto Rico. It was designed to encourage industrial investment on the island, and it worked. By the mid-1990s, Puerto Rico had become one of the world’s most concentrated centers of pharmaceutical manufacturing, biomedical devices, and precision industrial production.

The incentive was phased out beginning in 1996 and fully eliminated by 2006.

The Consequences

In their landmark National Bureau of Economic Research paper, “U.S. Multinationals in Puerto Rico and the Repeal of Section 936 Tax Exemption for U.S. Corporations,” economics professor Zadia Feliciano of Queens College and co-author Andrew Green analyzed the effects of the phase-out on Puerto Rico’s manufacturing sector — measuring the impact on establishments, value added, employment, and wages.

Their findings quantified what the island already knew:

  • Manufacturing employment declined sharply
  • Multinational corporations relocated production offshore
  • Wages compressed
  • The island entered what would become a decade-and-a-half of negative economic growth

The consequences extended beyond Puerto Rico. Critical U.S. supply chains — pharmaceutical ingredients, medical devices, protective equipment — moved to foreign jurisdictions where the U.S. government has neither regulatory oversight nor security guarantees.

Why This Matters Now

The Food and Drug Administration has repeatedly expressed concern about U.S. dependence on foreign medical supply chains — particularly on China. Recent geopolitical shifts have accelerated the reshoring conversation across pharmaceutical manufacturing, semiconductors, and defense-critical industries.

Puerto Rico is uniquely positioned to answer that call.

The infrastructure remains in place:

  • 49 FDA-approved pharmaceutical plants currently operating on the island
  • 25% of all U.S. pharmaceutical exports are produced in Puerto Rico — more than any state
  • Cold-chain logistics infrastructure already built out for high-value pharmaceutical exports
  • A workforce experienced in regulated manufacturing — decades of institutional knowledge that cannot be quickly rebuilt elsewhere

For institutional capital thinking about industrial reshoring, Puerto Rico offers something no other jurisdiction can: existing FDA-registered facilities, an experienced labor force, and U.S. jurisdiction — with the potential for renewed federal incentive frameworks.

The Forward Case

The manufacturing tax framework that supported Puerto Rico’s rise has been replaced in part by newer instruments — Act 60, Opportunity Zones, and various targeted incentives. But none has fully restored the strategic advantage Section 936 provided.

For allocators, developers, and policymakers, the question is no longer whether critical manufacturing should return to U.S. soil. That consensus has largely formed. The question is where.

Puerto Rico’s answer: infrastructure is already here, workforce is already trained, regulatory jurisdiction is already U.S.

The learning curve for a company evaluating pharmaceutical production in Puerto Rico is dramatically shorter than for any other U.S. region.

AG&T’s Perspective

At AG&T, we have advised on Caribbean development for nearly three decades — through the pre-936 boom, the post-repeal contraction, the 2017 hurricanes, and the current recovery. We have watched capital allocation cycles play out in real time.

Our conviction is straightforward: Puerto Rico’s manufacturing base is a strategic U.S. asset that has been consistently undervalued. As institutional capital rethinks supply chain resilience, ESG alignment, and long-term industrial strategy, the island’s mature manufacturing ecosystem deserves renewed attention.

The next generation of U.S. industrial policy will be shaped by decisions made in the next five to ten years. Puerto Rico should be central to that conversation.

AG&T is a Caribbean real estate capital advisor founded in 1998. Principal-led, AG&T has been involved in over 55 development projects across Puerto Rico, Sint Maarten, Costa Rica, the Dominican Republic, and other Caribbean markets — connecting institutional capital with regional opportunity. Contact us to discuss Caribbean manufacturing, hospitality, and infrastructure investment.

 

Valuing Climate Risk in the Built Environment

 

Valuing Climate Risk in the Real Estate

January 29, 2019 – Miami, Florida

Facilitated by Zac Taylor, PhD (Research Fellow, University of Leuven) and Adam Greenfader (Managing Principal, AG&T; chair of Caribbean Council of ULI Southeast Florida/Caribbean) Participants included individuals representing development, insurance, sales, master planning, public sector, legal, and academic perspectives.

 

Key Messages

  1. The economics of real estate in South Florida face several medium- and long-term challenges due to climate risk.
  2. Climate risks place pressure on the ability to create sustainable value from real estate in the region, including increasing costs of finance (insurance, investment, property tax), growing cap and op ex, and negative market perceptions.
  3. Proactive local action will be key, but not sufficient, to mitigate these concerns.
  4. Decision-maker education and collaboration, in part through ULI, will be essential to secure regional change.

Thematic Observations

Insurance – Property Rates and Terms

  • Insurance is geared towards the sudden and acute, not the gradual and chronic. Supply of capital for Florida risk is declining and will continue for those who continue to build in risky areas.
  • Risk of losing coverage over medium-term (eg 5-10 year hold period) is increasingly raising concerns about profitability of developer strategy in South Florida.
    • Eventually property owners cannot pass cost of insurance on to consumers/tenants – this will erode asset value.
  • Insurance rate baselines are 15-20% higher post-2017/18/19 underwriting cycle due to historic losses. Rates are cyclical to an extent, but unclear if this pattern will persist in context of growing losses, rising risk because insurers increasingly set rates according to reinsurance investor appetite (see ILS market).
  • Insurance policy terms are changing, and likely to continue, to limit insurer liability for losses. Requires careful scrutiny.

Location Investment Decisions

  • Institutional capital providers increasingly ask developers to address risks through asset-level mitigation.
  • Investors are also asking what community-scale measures are being put in place, in recognition that assets are not independent from broader risk/resilience patterns.

Public Finance

  • Bond ratings agencies increasingly looking at municipal creditworthiness in relation to economic exposure to climate risk (e.g. property tax base security). This may have impact on cost of capital.

Design and Mitigation Considerations

  • Public investments can have negative as much as positive impacts on private property (see Miami Beach road-raising) — this is cost and time intensive work, in part because it is politically contested and in part because of local public sector capacity.
  • Insurers likely to determine how, where development happens. Access to risk models has changed one participant’s understanding of their practice, re: valuation and incorporation of long-term risk reduction principles in design, building code, planning

Collaboration / ULI Opportunities

  • South Florida communities need a collaborative plan to address the economics of built environment climate risk. Without it, insurers and lenders will leave the market, and negative feedback loop (property devaluation) will be faster.

 

 To learn more: uli-selected-to-manage-southeast-florida-regional-climate-compact-project

Mixed-use project delivers on wellness in Puerto Rico

 AS PUBLISHED IN HOTEL BUSINESS  BY  ON

PONCE, PUERTO RICO—Ponce Paradise—a 900-acre resort, healthcare village and marina located here—is giving guests all the conveniences and amenities of mixed-use, but with a twist.

 

Master Plan Resort Destination

Adam Greenfader, managing partner, AG&T, the development firm behind Ponce Paradise, said, “There is a trend in hospitality development for travelers searching for a destination that offers a wellness package or amenities.”

Conceptualized by LandDesign and Winstanley Architects & Planners along with AG&T, the teams consulted engineering and aquatic architecture professionals to make the vision a reality, bringing together a mixed-use development and a wellness destination.

“Economies of scale seem to indicate mixed-use projects will be getting larger. The live-work-play concept is really taking hold as more people want to be in the center of it all,” Greenfader said.

Master Plan for Wellness City and Hospital

 

Ponce Hospital and Wellness City

 

Still in its early design and community involvement phase, Ponce Paradise will comprise a hotel and spa, wellness community, farm-to-table agricultural setup, a micro-grid, residential neighborhoods, a town square and a university medical center, with a total investment of approximately $1 billion.

Specifically, the 166-acre Wellness City will have research, university and care facilities, which will include a branded hospital, rehabilitation centers, outpatient, recovery rooms, assisted living facilities, nursing home, short-term residential units and condominiums. The wellness lagoon will have restaurants and retail, and a plaza will be home to a worship center, park and entertainment venue. 

 

The development will not only promote health and wellness but sustainability as well. About 60% of the site is untouched and will remain in its natural state, according to the Puerto Rico Conservation Easement Law. Additionally, the developed area has acres of green space, waterways and parks.

“Wellness tourism has been estimated as a $563 billion industry in 2018,” Greenfader said. “Puerto Rico is ideally situated to capture a large part of this market due to its central location, airlift and cruise traffic, U.S. medical doctors and great infrastructure.

“There are many medical treatments that can be done in Puerto Rico for a fraction of the cost—and you get to enjoy an amazing Caribbean vacation experience,” he added.

There are, of course, some challenges. “Less than 7% of Puerto Rico’s GDP is tourism based. For a Caribbean island with great beaches, people and infrastructure, this in incredibly low. The city of Ponce, in particular, has a convention center, port and airport that are highly underutilized,” Greenfader said, highlighting the project’s necessity.

He said the first challenge is to get the Municipality of Ponce and the Fiscal Board controlled by the U.S. Congress to fully use its assets. The second challenge—which is common in any large mixed-use project—is to provide the right combination of uses.

“The last challenge is financing,” he said. “In Puerto Rico, there are $20 billion of Community Development Block Grants for Disaster Relief. We trust some of that will be allocated to critical projects such as Ponce Paradise.”

Following meetings with the municipality, major medical associations, cruise lines and community leaders—each with their own concerns—Greenfader is confident that they will be able to address each group while also honoring Ponce’s natural surroundings.

 

“Our job as project sponsors is to balance the concerns of each group with the stewardship of the environment,” he said. “The project must make economic sense but also be a valuable contributor to the local region, protecting and enhancing natural assets.”

Greenfader said that as hospitality as a whole faces its own challenges, differentiators like mixed-use developments are gaining more momentum.

“Airbnb and other disruptors have proven that the market is changing and that guests are seeking new experiences. Budget allocations, the desire to be together in large groups and ease of booking a reservation are just a few reasons the hotel industry is adding more residential units,” he said.

According to Greenfader, residential space generates revenue that can assist with the financing capital stack, while also creating a rental pool of additional units for the high seasons.

Ponce Paradise plans to offer three residential options: single-family homes, smaller vacation rentals and affordable “shotgun-style” housing, all with their own facilities and security.

Its attention to health, however, is the real differentiator, with nature serving as both the basis for its design and Ponce Paradise’s mantra.

“Everyone realizes that wellness is holistic; we don’t just treat the physical but the whole mind, body and spirit,” Greenfader said. “Doctors know that a patient’s success rate is often a result of a positive mental attitude. A cold, sterile room doesn’t necessarily lend itself to great health. Great architecture, beautiful landscaping, water vistas, amazing smells, community, etc., can make the difference between success and failure in a person’s treatment.”

Wellness extends far beyond simple offerings here. “Doing yoga with goats may not prove to have ‘legs,’ but resort wellness has just begun to take off. The reasons are simple: Industrialized nations are getting older, people are living longer, and with two billion new tourists coming from India and China, there are many more potential people for this market niche,” he said. “Some experts say the wellness resort industry is expected to double within the next 20 years and become a $1-trillion industry.”

The sustainability factor is also attracting hoteliers, especially in an area that’s been struck by natural disasters.

“Developers are starting to realize that a weather-related crisis can have a devastating effect on operational risk,” he said. “If a hotel cannot withstand hurricane-force winds, floods and mold, then it will suffer huge downtimes and repairs. In fact, hotels may not ever come back online at all.”

Greenfader said that hotel buyers are now evaluating their portfolios for climate risk and realizing that initially spending 15-20% more in construction costs to make a project resilient and sustainable makes good business sense.

“Developers also realize that if they can stay open during a crisis, their occupancy will be 100% or more,” Greenfader said. “During a relief and rebuilding period, hotels host thousands of relief workers, insurance adjusters and other critical workers. It’s a win-win to be resilient and sustainable.”

This couldn’t be more clear than at the current time, when Puerto Rico is beginning to recover from a series of earthquakes, which Greenfader noted had hit the south particularly hard—especially structures built before 1990, when codes were updated to bolster construction for seismic activity.

“The earthquake reaffirms that a project like Ponce Paradise needs to build a resilient infrastructure into its master plan and be forward-looking in its design,” he said. HB

From the Netherlands to the Caribbean: Rethinking Climate Resilience for Island Communities

ULI Roundtable on Climate Resilience in The Netherlands

From the Netherlands to the Caribbean: Rethinking Climate Resilience for Island Communities

 

Climate resilience is no longer simply an environmental discussion.

It has become one of the defining economic and development challenges of the 21st century. For island nations throughout the Caribbean, climate adaptation influences everything from infrastructure investment and insurance costs to tourism, housing, transportation, energy, and long-term economic competitiveness.

Recognizing these challenges, Adam Greenfader with the Urban Land Institute (ULI) convened an international Climate Resilience Roundtable in the Netherlands, bringing together planners, architects, engineers, financial institutions, developers, investors, and public-sector leaders to explore how some of the world’s most climate-resilient communities can help shape the future of Caribbean development.

The discussion was particularly timely following the devastating impacts of Hurricanes Irma and Maria in 2017 and Hurricane Dorian in the Bahamas in 2019. These events highlighted the urgent need to move beyond disaster recovery and begin designing communities capable of withstanding the increasing impacts of climate change.

Learning from the Dutch

Few countries understand the relationship between water and urban development better than the Netherlands.

For more than a thousand years, the Dutch have designed cities, infrastructure, and landscapes that coexist with water rather than simply attempting to control it. Their expertise in flood management, adaptive urban planning, coastal engineering, and integrated water systems has become a global model for climate resilience.

Rather than viewing resilience as an additional cost, the Dutch approach recognizes it as a long-term investment—one that protects communities, reduces future losses, and creates stronger, more valuable places to live and invest.

As Caribbean nations confront rising sea levels, stronger storms, coastal erosion, and aging infrastructure, these lessons have become increasingly relevant.

Sharing Caribbean Experience

Representing the Caribbean perspective, Adam Greenfader, then Chair of the ULI Southeast Florida/Caribbean Council and Chairman of AG&T, shared lessons learned from the ULI Advisory Services Panel for the Municipality of Toa Baja, Puerto Rico.

The multidisciplinary panel examined how one of Puerto Rico’s most vulnerable municipalities could rebuild after Hurricane Maria while improving long-term resilience, strengthening economic opportunity, and reducing future climate risks.

Rather than focusing solely on reconstruction, the discussion emphasized creating communities that are stronger than those that existed before the storm.

This philosophy—often described as “building back better”—has since become a guiding principle for resilient development worldwide.

A Global Perspective

Joining the discussion was Henk Ovink, the Netherlands’ Special Envoy for International Water Affairs and one of the world’s foremost experts on climate adaptation and water management. Mr. Ovink discussed how climate resilience requires integrated thinking across government, infrastructure, finance, urban planning, and community engagement.

His work through initiatives such as Rebuild by Design, the Global Center on Adaptation, and Water as Leverage has demonstrated that resilience is most successful when architects, engineers, investors, policymakers, scientists, and local communities collaborate from the earliest stages of planning.

The message was clear:  Resilience cannot be added at the end of a project.

It must become part of the project’s DNA.

 

From Recovery to Regeneration

One of the most important themes of the roundtable was the distinction between recovery and regeneration.

Recovery seeks to restore what existed before.

Regeneration asks a more ambitious question:

How can we rebuild communities that are stronger, safer, more sustainable, and better prepared for future generations?

That philosophy extends far beyond engineering.

It includes resilient housing, renewable energy, modern infrastructure, nature-based solutions, flood management, resilient tourism, environmental restoration, and economic diversification.

Increasingly, these principles are also influencing investment decisions.

Why This Matters Today

Since this discussion took place, climate resilience has become one of the most important considerations in global real estate and infrastructure investment.

Institutional investors now routinely evaluate climate risk alongside traditional financial metrics.

Insurance markets increasingly reward resilient design.

Hotels, resorts, airports, ports, hospitals, and mixed-use developments are incorporating resilience into their planning from the earliest stages.

For the Caribbean, resilience is no longer simply about protecting communities.

It has become a competitive advantage.

Destinations that invest in resilient infrastructure, sustainable development, renewable energy, and climate adaptation will be better positioned to attract tourism, institutional capital, and long-term economic growth.

AG&T’s Perspective

For more than three decades, AG&T has viewed resilience as an essential component of responsible development throughout the Caribbean.

Whether advising hospitality projects, master-planned communities, infrastructure initiatives, or economic development strategies, we believe resilience should not be treated as a regulatory requirement or a marketing slogan.

It is an investment strategy. Projects that are thoughtfully designed to withstand climate risk, reduce operating costs, protect natural systems, and enhance community well-being create stronger long-term value for investors, residents, and governments alike.

The conversations held in the Netherlands reinforced an important principle that continues to guide our work today: The Caribbean has the opportunity not simply to recover from climate change—but to become a global leader in resilient, regenerative development.

By combining local knowledge with international best practices, we can create island communities that are stronger, more sustainable, and more prosperous for generations to come.

 

      Some of the works discussed: