Saint Martin Making A Comeback

back Irma

Saint Martin is making a comeback. While there is still work to be done, this unflappable island is ready to welcome visitors with new infrastructure, revamped resorts, and unmatched natural beauty.  Saint Martin, the half-Dutch, half-French gem of the Leeward Islands, has been a popular vacation destination for Americans since the 1950s. Tragedy struck in September 2017, however, when the Category 5 Hurricane Irma raged over the island for a full eight hours. This was one of the worst-hit islands, and it’s estimated that more than 90 percent of the buildings were damaged; one-third were completely destroyed.

Most of the population is involved with tourism in some way, so residents, the European Union, and the World Bank knew it was crucial to put infrastructure back in place quickly to get evacuees out and supplies in. There have been people on the ground working tirelessly to get this beloved Caribbean destination back, slowly but surely, on its feet.

At this point, despite the largely completed work on infrastructure, only about half of the island’s pre-storm hotel capacity has been restored.   

Read More at https://www.travelandleisure.com/trip-ideas/island-vacations/saint-martin-sint-maarten-hurricane-recovery-new-resorts

Caribbean Hospitality Summit Draws Record Numbers

Bisnow Caribbean Hospitality

 

Investor Sentiment For Rebuilding The Caribbean Region Remains Strong

 

Miami, Florida – The Bisnow Caribbean Hospitality and Tourism Summit held on August 1, 2019 at the Intercontinental Hotel in Miami drew over two hundred investors, developers, hotel operators and other industry professionals.  

Sponsored by the Puerto Rico Builders Association, this “not to miss” investor event celebrated its 3rd year.  Special shout out to Katya Demina for her help in making the event such a great success. Join us for more events at AG&T. 

Puerto Rico Ready for Development

Ponce Paradise

A Beachfront Acre For $30K In An OZ? Welcome To Puerto Rico

Published by Deidra Funcheon, Bisnow Miami

Puerto Rico was already struggling from decades of fiscal mismanagement and had just declared bankruptcy over its $123B debt when it was hit by two hurricanes in September 2017 — only to run into a botched disaster response. The way some see it, though, rock bottom is behind Puerto Rico, and the island is in the early stages of an upswing. “Puerto Rico is setting an incredible pace for economic recovery,” said Brad Dean, CEO of Discover Puerto Rico, a destination marketing organization that promotes the commonwealth. “Airport arrivals are exceeding pre-Hurricane Maria levels, as are lodging revenues. Given the quick rebound, reinvestment in hotel product and tremendous potential for the island’s tourism industry, this is Puerto Rico’s time. From an investor’s perspective, there’s never been a better time to invest in the island’s tourism industry.”

Buildings and infrastructure are still being repaired and upgraded, and the government has instituted a full slate of tax incentives to lure investors, said AG&T Managing Partner Adam Greenfader, who advises clients from his base in Miami. “You can still acquire assets for 50 cents on the dollar,” he said. “Beachfront land in Puerto Rico today can still be acquired at $30K an acre.” Dean and Greenfader will be panelists at Bisnow’s Caribbean Hospitality & Tourism Summit Aug. 1. Puerto Rico’s economic spiral goes back decades. After World War II, it gave big tax breaks to manufacturers, and to cover for revenue shortfalls, issued more bonds than it could repay. In turn, it implemented austerity measures that did little except drive the population away. Its problems were exacerbated by that fact that it has no voting power in Congress.

Greenfader outlined some key developments toward a turnaround. Puerto Rico’s cash-strapped government has tried to lure investors with laws like Acts 20 and 22, passed in 2012 and designed so that people who move to the island pay little or no federal income tax, even on passive investments. Greenfader said this has attracted 250 to 500 families per year, including big names such as billionaire John Paulson.  Other incentives include one that lets people with tourism-related projects get back 40% or 50% of their acquisition costs.  

 

Development Land
80 Acres in Naguabo, Puerto Rico

 

Puerto Rico’s massive government debt is currently being sorted out by a federal oversight board. “The major bonds, COFINA and GO, have been renegotiated and the bondholders have been put into payment plans,” Greenfader said.  Since the 2017 hurricanes, federal disaster aid — including $1.4B authorized in June — has trickled in. Hotels damaged in the storms were forced to remodel or rebuild and are now offering better products at higher rates. Many are incorporating solar and microgrids to be resilient for the future. The storms raised the profile of Puerto Rico — one study found that prior to them hitting, about half of Americans hadn’t known the commonwealth was part of the U.S. Airport arrivals and tourism revenue have already set records this year. On top of this, Puerto Rico is the beneficiary of community development block grant funding, and 97% of the entire commonwealth — much of it beachfront — has been designated a qualified opportunity zone. “Puerto Rico never had a 1031 exchange, so from a tax perspective, it’s the first time it’s getting capital gains money,” Greenfader said.  

Lifeafar Investments Chief Financial Officer Cole Shephard, who will also be a panelist at the Bisnow event, said his Colombia-based company is already taking advantage of Puerto Rico’s investment climate, raising $16M in an opportunity fund to reposition a 61-room hotel. Shephard said Lifeafar, which started by offering real estate services to expats in Medellín, was drawn by the tax incentives and that the opportunity zone designation was a bonus. He is now doing due diligence on additional properties. “I see the sophisticated money chasing metro San Juan,” he said, suggesting that there is a lot of opportunity for small to mid-market projects outside of the city. Not everything in Puerto Rico is rosy. 

Development Land
29 Acres in Isabella, Puerto Rico

 

As the government has scrambled to generate revenue, sales tax was raised to 11.5%, pensions have been cut, college tuition increased and some 300 public schools closed. Critics have complained that wealthy investors have been protected while ordinary Puerto Ricans suffer. “The locals have had to carry the brunt of these austerity measures,” Greenfader acknowledged. “I’d understand completely, if I see a guy who’s a hedge fund manager with $500M earnings pay hardly any taxes, versus the regular guy paying 35% taxes who’s a salaried worker at Bacardi,” Shepherd said. But Shepherd added that conversations with Puerto Rican officials convinced him they have carefully calculated the tradeoff and found that luring private investment now will help island residents long-term, even though it may take years for the effects to be obvious.

Greenfader suggested that boosting tourism is a winning solution for both investors and residents. Because Puerto Rico since the Kennedy era has been focused on manufacturing, its tourism industry was relatively neglected. The industry now accounts for less than 7% of Puerto Rico’s gross domestic product. In other Caribbean islands, that number is typically between 30% and 80%. Dean’s destination marketing organization, Discover Puerto Rico, was established last year to actively promote tourism. Bisnow’s Aug. 1 Caribbean Hospitality & Tourism Summit will also include Puerto Rico Tourism Co. Executive Director Carla Campos, Hilton VP for Development Juan Corvinos Solans, Puerto Rico Builders Association President Ing. Emilio Colón Zavala and more. 

Event Ended On: Thursday August 1 2019

Puerto Rico’s Gets A Hyatt Regency

 

 

Governor Announces Puerto Rico’s First Hyatt Regency

The Weekly Journal Staff 6-4-19

Gov. Ricardo Rosselló announced that Gran Meliá Hotel was bought by Monarch Alternative Capital in partnership with Royal Palm Companies and Ambridge Hospitality.  Together they will rebrand and relaunch the hotel as the Hyatt Regency Grand Reserve. The governor announced that the developers are contemplating a 10-year master plan. This will include  six hotels in the Grand Reserve (Coco Beach) peninsula in Río Grande, of which three are expected to be opening by 2022. “Transactions such as these that are happening now validate that our commitment to tourism is a successful one, and there is a positive environment for investment,” Rosselló said at the 41st International Hospitality Industry Investment Conference by New York University (NYU). The governor added, “we have managed to streamline processes to grant tax benefits and permits, which proves that this administration maintains a bureaucratic battle so that the private sector may have better investment opportunities.”

New Project

The Hyatt Regency Grand Reserve Resort will have five new restaurants and will create roughly 200 new jobs. The average rate is expected to fluctuate by $300 per night. During his presentation, Rosselló revealed blueprints and mockups for the property. He stressed that Puerto Rico’s “fertile and positive” environment for investments in the hotel industry.  The Hyatt Regency Coco Beach Resort is part of a $120 million deal made possible through an agreement with the Puerto Rico Tourism Co. (PRTC), which granted tax credits conforming to the P.R. Tourism Development Act (Act No. 74-2010). Of the total investment, $100 million correspond to development costs to elevate the property to Hyatt’s luxury standards. The PRTC has been working on this business deal along investors for several months. PRTC Executive Director Carla Campos assures that Tourism is focused on increasing the island’s hotel inventory in the short term, emphasizing Puerto Rico’s “competitive and incomparable” investment advantages.

After damages caused by Hurricane Maria in 2017, Monarch Alternative Capital, which already had interests in the peninsula, seized the opportunity to acquire the Gran Meliá Resort, with 486 rooms, 135 bedroom units, and 14 more terrain acres. In order to proceed with the transaction, Monarch made a conjoint agreement with Royal Palm Companies and Ambridge Hospitality. According to Campos, this project makes part of a “long-term master plan” that seeks to add 2,500 new rooms to the island’s hotel inventory and 1,500 new jobs. “This will result in a total investment of roughly $1.5 billion, when the six hotels are finished,” she added. Both the governor and the PRTC executive director stressed Puerto Rico’s strategic position as a connector between the United States and Latin America and the island’s structural reforms, which they claim positions Puerto Rico as the most competitive U.S. jurisdiction for hotel investment.

The officials also highlighted the investment tools that provide a combination of tax benefits at state level, in addition to the competitive advantage of being almost entirely eligible for certain benefits and exemptions under the Opportunity Zones incentive as included in the U.S. Tax Cuts and Jobs Act of 2017. 

For more information on Caribbean hospitality projects, contact AG&T. 

Puerto Rico Still Staggering From Impact of 2017 Storms

 

Puerto Rico Still Staggering From  2017 Storms

Adam Greenfader, managing principal, AG&T, said hurricanes Maria and Irma destroyed or damaged a large share of Puerto Rico’s housing and commercial structures, spurred insurance insolvency and changed the market for coverage. Greenfader spoke with AM BestTV at the RMS Exceedance 2019 conference, held in Miami.

 

 

See Video Link  http://www.ambest.com/video/MediaArchive.aspx?lid=6017540143001&vid=6037105941001

Adam Greenfader

ULI CARIBBEAN ROUNDTABLE

 

On May 8th,  the ULI CARIBBEAN ROUNDTABLE celebrated its second ROUNDTABLE meeting of the year.  The turnout at Wework in Brickell City Centre was large and enthusiasm for the region palpable.  Present at the event were industry leaders in finance, debt lending, construction, architecture, affordable housing, hotels and green building.      

Big shout out to the Kresge Foundation (https://kresge.org) and all who participated in the Toa Baja Puerto Rico Resiliency Panel. The panel was but another example of the  capacity of ULI to bring real solutions to real world problems.    

Special thanks to our two speakers at the ULI CARIBBEAN ROUNDTABLE -Mr. Rogerio Basso, Head of Tourism at IDB Invest and Mr. Andrew Dicky – Executive VP JLL Hospitality. Financing projects in the Caribbean brings its own set of challenges and opportunities. It was great to look under the proverbial “hood” and examine how capital approaches Caribean hospitality lending. 

Save the Date –On August 1, 2019, The Puerto Rico Builders Association will be hosting its 3rdAnnual Bisnow Caribbean Hospitality Investment Summit in Miami. If you are interested in Speaking/Sponsoring there are a few spots available please reach out to Jorge Montilla jmrm@mcvpr.comfor more details.

You can also see a full list of ULI Events at: https://seflorida.uli.org/events/

 

Caribbean Investment Summit- Boca Raton

The Agency Summit

 The Agency’s kicks off its first annual summit which will bring together key insiders, legal experts, developers, and market analysts ready to engage and share their knowledge on investing, business, and selling in the Caribbean.  Adam greenfader to speak on new hotel development in the Caribbean.

 

To learn more about AG&T, click here. 

 

Plan Your Day

 

AG&T Congratulates UM 2019 Thought Leaders

Thought leadership

We welcome this year’s class of great thought leadership to AG&T.    Each with a very unique set of skills, languages, and impressive backgrounds…all expanding their knowledge base at the University of Miami Master of Real Estate Development Program. 

Big things to come from this amazing group and lots of hope for our industry.  

 

 

 

 

Caroline Cozzi – See Linkedin Profile 

Francisco Masso –  See Linkedin Profile

Xiaoyun Jiang 

 

 

 

 

 

 

 

If you are interested in joining our internship program contact us. 

 

Strong turnout at the first 2019 ULI Caribbean Roundtable Panel

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.

Other Events 

The roundtable conversation highlighted a series of events that will be taking place in 2019 (email adam@agandt.net 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)

Vision Awards

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

Coming Next

For the next roundtable the following items were discussed as potential areas of interest:

  1. To discuss a list of hospitality projects that are getting funded in the Caribbean Region, share details on projects and the funding
  2. Bahamar project and case study
  3. Sources of hotel financing and the interplay of mezzanine financing
  4. The synergy of luxury cruise ships and private islands
  5. The business of Cannabis in the Caribbean
  6. The effect of Hurricanes on hotel supply and competition
  7. 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.

ULI Panel To Advise Puerto Rico on Hurricane Resilience

The Urban Land Institute to Advise Toa Baja, Puerto Rico on Hurricane Preparedness and Resilience

POSTED ON NOVEMBER 29, 2018 BY JUSTIN ARNOLD

https://americas.uli.org/advisory-service-panels/toa-baja-puerto-rico-resilience-advisory-services-panel/

Nationally Renowned Panel of Land Use and Urban Planning Experts to Visit Area December 3-7.

For more information contact Adam Greenfader at adam@agandt.net.

WASHINGTON (November 29, 2018) – A group of nationally renowned land use, real estate, and urban planning experts representing the Urban Land Institute (ULI) will be providing strategic recommendations and advice next week to the municipality of Toa Baja, Puerto Rico, on how to best improve preparedness for extreme weather events and ensure all residents benefit from investments in resilience.

ULI is a global, multidisciplinary real estate organization whose work is driven by 42,000-plus members dedicated to responsible land use and building thriving, sustainable communities. The ULI representatives, convened through ULI’s renowned Advisory Services program, will be visiting Toa Baja, Puerto Rico from Sunday, December 3 through Friday, December 7. The panel will provide strategic advice on resilience, economic development, housing, and land use protocols. Items to be addressed include:

  • implementing land use processes to mitigate environmental risks,
  • securing access to partnerships and investment opportunities, and
  • leveraging competitive economic advantages and drivers to ensure all residents benefit from improved resilience.

During the week, the panelists will tour the study area and spend two days meeting and interviewing stakeholders from the public and private sectors, including Toa Baja Municipality leadership and Mayor “Betito” Marquez. After carefully analyzing the site and completing the interviews, the panelists will then frame their recommendations and draft a presentation that will be made to the public at the end of the visit.

 

The panel’s upcoming visit was initiated when the Urban Land Institute Advisory Services team was invited by ULI SE Florida/Caribbean, Puerto Rico’s Builder’s Association and the municipality of Toa Baja leadership in late August 2018 to discuss the opportunity to provide technical assistance to enhance the community’s economic and climate resilience. The team received context of Hurricane Maria and Irma’s impacts as well as a guided tour of areas the municipality identified in need of reinvestment.

“This is a unique opportunity to showcase a community that represents a microcosm of the entire Island of Puerto Rico,” said ULI Foundation Governor and ULI Puerto Rico Co-Chairman Ricardo Alvarez-Diaz, who is chief executive officer and president of Alvarez-Diaz & Villalon. “Our goal is to take the panel’s recommendations and implement them not only in Toa Baja but throughout the whole island.”

The chairman of the panel is ULI Life Trustee James DeFrancia, president of community development at Lowe Enterprises in Denver, Colorado. “We are excited to bring the expertise of our members to Toa Baja,” DeFrancia said. “The strength of the Advisory Services program lies in ULI’s unique ability to draw on the substantial knowledge of members representing all aspects of the real estate industry. The independent views of the panelists bring a fresh perspective to land use challenges. The advisory services program is all about offering creative, innovative approaches to community building.”

DeFrancia will be joined on the panel by Sarah Sieloff, executive director, Center for Creative Land Recycling, Oakland, California, who will serve as vice chairman, and panel members Michael Bloom, department manager, sustainability practice, R.G. Miller Engineers, Inc, Houston, Texas, Trini Rodriguez, principal, ParkerRodriquez, Inc., Alexandria, Virginia, Thomas Roth, principal, Grass River Property, Coconut Grove, Florida, Don Edwards, chief executive officer and principal, Justice & Sustainability Associates, Washington, D.C., Chris Calott, LaLanne Chair – R.E. development, architecture and urbanism and associate professor of architecture, University of California, Berkley, California, Jessica Boehland, senior program officer, environment, The Kresge Foundation, Detroit, Michigan, and Bob van der Zande, director of residential markets, City of Amsterdam, Metropolitan Region.

The assignment for Toa Baja is part of a series of advisory panels being supported by a generous grant from The Kresge Foundation to advance the Institute’s promotion of urban design and development practices that are more resilient and adaptable to the impacts of climate change. With Kresge’s support, ULI is leveraging the substantial expertise of its members to provide guidance on community building in a way that helps to preserve the environment as well as boost prosperity and foster a high quality of life.

Now in its 71st year, ULI’s globally renowned advisory services program assembles experts in the fields of real estate and land use planning to participate on panels worldwide, offering recommendations for complex planning and development projects, programs and policies. Panels have developed more than 700 studies for a broad range of land uses, ranging from waterfront properties to inner-city retail.

Past sponsors of ULI advisory service panels include: federal, state and local government agencies; regional councils of government; chambers of commerce; redevelopment authorities; private developers and property owners; community development corporations; lenders; historic preservation groups; non-profit community groups; environmental organizations and economic development agencies.

NOTE TO REPORTERS AND EDITORS: Members of the public and media are invited to a reception on Monday, December 3rd, from 5:30 pm – 7:00 pm at the Centro Las Dos Fuentes, 867 Carr Rio Hondo, Toa Baja, PR. The panel will provide its recommendations at a public presentation on Friday, December 7th at 9:00 am at the Centro Comunal Rafael “Pipo” Negron Calle Aetria Ingenio in Toa Baja, Puerto Rico.

About the Urban Land Institute
The Urban Land Institute is a nonprofit education and research institute supported by its members. Its mission is to provide leadership in the responsible use of land and in creating and sustaining thriving communities worldwide. Established in 1936, the institute has more than 40,000 members worldwide representing all aspects of land use and development disciplines.

 

 

Sponsor thanks:

 Kresge Foundation, ULI Southeast Florida,  Puerto Rico Builders Association.

For more information: adam@agandt.net