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

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

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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. 

 

Are Hotels Coming Back to The Caribbean?

Are Hotels Comming Back Caribbean

Join an all-star panel to discuss “Are Hotels Coming Back to the Caribbean?” : a ULI discussion on The State of the Caribbean Hotel Market.

 

Hear from leading Caribbean hospitality professionals about what’s happening from operations, investing, transactions, and lending perspectives.

 

 

Adam Greenfader

Managing Partner AG&T

 

Alejandro Zozaya

Executive Chairman, Apple Leisure Group

 

Christian Charre

Senior Vice President, CBRE Hotels

 

Chris Cylke

COO, REVPAR International, Inc.

 

 

Nicholas Hecker

Executive Managing Director/Chief Investment Officer, 

Sculptor Real Estate

 

Three questions answered: 

 

1. What hotel transactions are happening today?

2. Is the hotel market going to undergo a series of defaults, acquisitions, and repurposing?

3.  What operational changes is the hospitality industry doing to successfully come back on line?

 

 

 

The State of Tourism in Latin America and Caribbean with IDB Invest

Rogerio Bass

ULI Caribbean Conversation

“The role of multilateral development banks (MDBs) in supporting the tourism sector in Latin America and the Caribbean”.

Conversation with with Rogerio Basso, Head of Tourism at IDB Invest and Adam Greenfader, Chair ULI Caribbean Council / Managing Partner AG&T.

  • * State of affairs of the tourism sector prior to COVID-19?
  • What makes this crisis different than prior ones?
  • What tourism players are doing to mitigate the impact of the pandemic?
  • Top three actions to better face this crisis?

 

Rogerio Basso leads all initiatives related to tourism in Latin America and the Caribbean for IDB Invest, the private sector arm of the Inter-American Development Bank Group. In his capacity as Head of Tourism, he is responsible for origination, investments and for executing IDB Invest’s tourism strategy in the region, offering a variety of financial instruments including debt, mezzanine and equity. Rogerio has executed numerous tourism transactions in the region spanning from hotels to conference centers.With over two decades of experience in banking, private equity, development, and strategy consulting within the hospitality and real estate sectors, Rogerio has held a variety of positions across top global firms, working across a variety of domestic and foreign markets, with a strong focus in Latin America. Prior to joining IDB Invest, he was CIO at Key International, a Miami-based real estate investment platform active across many industry sectors. He also served as EVP Acquisitions & Development for Terranum Hotels, an owner and operator of hotels across Latin America, sponsored by Colombia-based Santo Domingo Group and Sam Zell’s Equity International.

 Rogerio holds a business degree from the College of William and Mary and a master’s degree from the School of Hotel Administration at Cornell University.

Tax Incentives for Strategic Recovery

See video on strategic tax incentives and recent fiscal policy for the territories and Puerto Rico.

Francisco Luis, Partner at Kevane Grant Thornton and Adam Greenfader, Caribbean Chair / AG&T discuss “ Bringing back manufacturing to USA – Puerto Rico. “ 

In this in-depth conversation about Tax Policy and Incentives,  Mr. Luis discusses the GILTI and BEAT provisions of the 2017 Tax Code and some of the implications of the House Resolution 6448; otherwise known as ” The Territorial Economic Recovery Act.

Other topics include,  ‘Opportunity Zone incentives’ and the ‘Tourism Tax Credit’ as part of the recently passed Act 60.

Francisco Luis has over twenty-nine years’ experience in public accounting, including the “Big Four” and private consulting practice. 

He engages in the design and development of tax planning and consulting strategies. This includes tax services in the area of mergers and acquisitions, business reorganizations, partnership transactions, tax incentives and exemptions, individual and corporate tax issues, personal financial matters, and others. Moreover, since the designation of Puerto Rico as an Opportunity Zone, Francisco has been actively participating as guest speaker on several conferences and activities lecturing about this new incentives regime.

His experience includes participation in multiple international and global business transformation engagements, including post-acquisition implementation and executing strategies focused on reducing global effective tax rates, mostly interplaying with the Puerto Rico tax incentives. Francisco has significant experience assisting clients before the Internal Revenue Service and the Puerto Rico Treasury Department, among others. He also possesses extensive tax compliance experience.

Membership

  • Puerto Rico State Society of Certified Public Accountants
  • American Institute of Certified Public Accountants