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 After The Hurricanes: Investors And Bitcoin Cowboys Are Circling

By Deirdra Funcheon as Published in Bisnow South Florida

Puerto Rico has been desperate for aid that has been too slow and insufficient following hurricanes Irma and Maria in 2017. But a few on the island say the attention followed might ultimately be a net positive for the commonwealth. “The bottom line is that Puerto Rico in the next two to three years is expected to see strong growth — 3 to 3.5% of GDP,” said Adam Greenfader, principal of Miami-based AG&T Development and Advisory Services. “It hasn’t had growth in 12 years. A depression is defined as negative economic growth for three quarters, so for all intents and purposes, Puerto Rico has been in a depression for 12 years.”


Greenfader married into a family that facilitates Section 8 housing throughout Puerto Rico. He then became a developer there himself. Currently, he serves as the liaison to the Puerto Rico Builders’ Association and the chair of the Urban Land Institute’s Caribbean Council. Greenfader points out that while last summer’s hurricanes devastated the commonwealth, jobs had already been scarce for more than a decade as the government faced a crippling debt crisis, owing $123B and declaring bankruptcy last spring. Though an estimated 150,000 Puerto Ricans fled to the U.S. mainland after the hurricanes, between 60,000 and 70,000 residents had already been leaving each year of the crisis. Puerto Rico’s current population is about 3.5 million, down from a peak of about 4 million, Greenfader said.

Turnaround efforts began years ago. Reforms enacted in 2012 enticed businesses and high net worth individuals to relocate to Puerto Rico by taxing corporate profits at a flat 4% and eliminating taxes on dividends, interest and capital gains for anyone who resided at least half the year in Puerto Rico. For anyone selling a company or large amounts of stock, these measures could result in saving millions of dollars on taxes. Famously, Putnam Bridge Funding CEO Nicholas Prouty invested more than $100M and relocated his family. Billionaire John Paulson bought several hotels. Michael E. Tennenbaum founded Caribbean Capital & Consultancy Corp. Goldman Sachs and various hedge funds moved in and bought distressed mortgages for pennies on the dollar. 

Greenfader said that about 1000 high net worth individuals moved to the island, and about 200 are coming each year. Cottage industries sprung up to cater to these ultra-wealthy.  Then last year’s hurricanes blew through, knocking out power and killing 64 people directly and 4,645 in total, according to Harvard University. Though the U.S. government responded painfully slowly, $18B in aid has been approved from the Department of Housing and Urban Development, and billions more are expected, Greenfader said.

Recovery is slow, but happening. Tesla built a solar array to power a children’s hospital. Doctors are being offered tax incentives to stay in Puerto Rico. Private insurance companies have started to pay claims, so 60% of hotels are now operational, Greenfader said. He believes that when the economy improves, exiles will move back. 

Publicity around the hurricanes certainly brought attention to the commonwealth. Immediately after the hurricanes, only about half of Americans knew that Puerto Rico was part of the United States; that number has since risen to 76%. Following the disaster, dozens of cryptocurrency entrepreneurs relocated to San Juan to buy hundreds of thousands of acres of land, take advantage of the tax structure and set up a “crypto utopia.” Greenfader suggested there is more opportunity for economic recovery: Puerto Rico’s tourism industry makes up only 6.5% of gross domestic product, whereas on many Caribbean islands, that figure is 50% or more. That is by design, he said; in the 1950s and ’60s, laws were structured to keep out the Mafiosos who ran Cuba. It could be increased substantially. 

Furthermore, the island has long had a mishmash system of collecting property taxes, partly because so many homes are built informally or illegally — “People get a paycheck, buy [a] few beers, invite their friends and family over to build a wall at a time,” Greenfader said — and partly because the tax code hasn’t been revised since 1950s. “A property worth a million dollars might pay no more than $2K, $3K in taxes for a year,” Greenfader said. A better system of collecting taxes could be implemented to make the government more solvent.  Although he is optimistic, Greenfader acknowledged the challenges.

While Puerto Rico is a diverse society, where rich and poor have long mixed freely, the influx of people taking advantage of the tax breaks is “adding an upper class the island never had before,” he said, and there has been some blowback. Workaday employees are facing pension cuts and austerity measures as Puerto Rico grapples with its debt. Currently, according to Democracy Now, 55,000 residents are in foreclosure and the government is turning to privatization as the solution for economic woes, which will enrich investors but hurt the working class. In a Bloomberg article Monday about the search for someone to buy the country’s beleaguered electric company, which goes so far as to ask potential buyers how they would like to be regulated, a Puerto Rico resident said, “We are tired of people coming here to get rich and take advantage of us.”  Some grass-roots organizations have taken shape to resist Wall Street — forces that author Naomi Klein explores in a new book, “The Battle for Paradise: Puerto Rico Takes On the Disaster Capitalists.”

Greenfader noted that insurance premiums will likely continue to rise, and the Jones Act, a shipping law that requires goods to stop in a mainland port, makes commodities expensive. Whatever economic policies prevail, at least new construction on the island should be more resilient. Greenfader said builders already adhere to codes that mirror Miami-Dade’s, which were made stronger after Hurricane Andrew in 1992. They use reinforced concrete and no wood. Going forward, he said, there is a commitment to using more sustainable designs, particularly in the energy space, such as solar power arrays and micro electric grids. Today, about 10,000 customers in Puerto Rico who lost electricity after last year’s hurricanes are still without power. 

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Renewed efforts and enthusiasm to promote Puerto Rico’s business and tourism industries

The Puerto Rico Builders Association continues with renewed effort and enthusiasm to promote Puerto Rico’s business and tourism industries on the island as well as the mainland U.S..  In 2017, the Puerto Rico Builders Association and Governor Ricardo Rosselló Nevares hosted over two hundred investors, developers, and institutional capital groups at the Caribbean and Latin America Investment Summit. The event was a resounding success and attracted many large investment groups to Puerto Rico  – as well as garnered much National and International media attention.



Building on last year’s success, The Puerto Rico Builders Association will be hosting with Bisnow, the largest platform for CRE news, events and education in the world, its first Caribbean Hospitality Investment Summit in Miami. Join us on August 23, 2018, at the summit, where we will gather industry leaders and key government representatives to discuss everything from hotel and resort development, to the future of tourism, resiliency, and recovery strategies. Some of the speakers include:

Ing. Emilio Colón Zavala
Puerto Rico Builders Association/ ECZ Group, Richard Millard
Trust Hospitality, Rogerio Basso
Head of Tourism
Inter-American Development Bank, Fernando Fernandez Vice President Of Development, Caribbean Apple Leisure Group,  Jonathan Kracer
Sion Capital, LLC., Ted Middleton
Senior Vice President – Development – Hilton Worldwide, Christian Glauser-Benz
Vice President, Development & Acquisitions
Dream Hotel Group, Harry Cook
Capital Member, Real Estate & Finance Practice Group
McConnell Valdés, Vanessa Mange
Director, Global Development Kimpton Hotels, Jorge Ruiz-Montilla
Capital Member and Chairman, Real Estate & Finance Practice Group
McConnell Valdés,



For more information about the event, please contact Adam Greenfader at 305.363.8833 or to grab a ticket, visit Bisnow’s event page.




2018 Caribbean Hospitality Financing Survey


KPMG Just released its 14th annual Caribbean Hospitality Financing Survey highlighting financing trends in the region’s hospitality and tourism industry and the outlook for the future of the industry.

The major event since our last survey was the catastrophic 2017 hurricane season which had a devastating impact on many countries in the region. It was therefore, with some trepidation that we approached financiers of tourism projects in the region. We were pleasantly surprised, and relieved, to find remarkably high levels of confidence in Caribbean tourism amongst financiers. Confidence levels for banks increased for an astonishing ninth year in a row and the confidence levels of non-banks (private equity, family offices etc.) were even higher. However, lessons have been learned. Financiers will be scrutinizing insurance coverage and quality of construction more intensely than they did prior to Irma and Maria.

Some of the key findings of the survey include:

  • Confidence levels of banks and non-banks have increased despite the impact of hurricanes;
  • Financiers’ appetite for issuing senior debt not just for expansions and renovations but acquisitions;
  • The quality of construction will receive more attention and adherence to codes of construction will be non-negotiable;
  • An increasing number of financiers are willing to consider new builds;
  • Half of the banks and 57% of non-banks think the economy is approaching the peak;
  • The issue of insurance, the adequacy of coverage and the approach taken by insurers received a lot of attention; and
  • The critical issues impacting financing activity in the region.


HOLA Conference – Day 1

5|15|2018 – JW Marriott, Downtown, Miami.  

AG&T and the Builders Association of Puerto Rico invited to participate at the Hotel Opportunities Latin America (HOLA) Conference in Miami. 

Some take aways from today’s meeting in Miami. 

  • The LATAM hotel industry is seeing a lot of over supply with a few exceptions in the emerging countries. 
  • Big hospitality growth in Colombia(14%), Costa Rica(15%)  and Peru (18%) . 
  • Mexico and Brazil still lead in overall Latin American hotel supply pipeline. 
  • As for new development, risk management is the word of the day. As is expected, all inclusive resorts seem less concerned about the new disruptors like Airbnb, but all are keeping their eyes on elections in several key countries. 
  • Argentina and Brazilian markets continues to draw hotel groups but there is uncertainty about exit timetable. 
  • Investors in several LATAM countries move beyond capitalization rates and focus primarily on desired yields.


Join us at the Hola:





As Puerto Rico continues to work around the $70B public debt crisis that threatens its economy, the commonwealth’s governor, Ricardo Rossello Nevares, and another key economic development official are pushing for private development that could help tip the economic scales. Gov. Ricardo Rossello said the island nation is pushing public-private partnerships to help various redevelopments in the country that will ultimately lead to job creation. With the economic crisis, Puerto Rico’s unemployment rate topped 12% as of January.

Open for business means we are going to foster economic growth and private investment,” said Manuel Laboy, secretary of economic development and commerce of Puerto Rico, during a Bisnow event focused on Latin American investment and development last week in Miami. “It means that the government needs to be out of the way.” Laboy said the government has targeted to grow tourism from being 7% of the total economy to 15% within five years. “That means that we’ll need more hotels. That means that we’ll need more facilities,” he said.


Coco Beach Residences

Jay Smith, president of nFusion Consultancy, already is a believer in the Puerto Rico recovery story. His firm specializes in “broken” projects for a value-add play. “Those opportunities in the United States are virtually gone,” Smith said. “They are very thin.” The firm invested in Coco Beach, a 1000-acre oceanfront project that holds a 36-hole golf course that hosts the PGA tour. Smith told Bisnow in a previous interview that nFusion is marketing a development plan for a hotel and up to 1,000 homes as well as a small town center for a mixed-use community. “Ultimately, we’ll sell it or partner with a developer, most likely from the United States,” he said.

Because of the bond crisis, Smith said real estate values have bottomed out and are ripe for investing. That is helped by Puerto Rico having a seamless regulatory environment, much of which is run by U.S. government entities. “It’s a very similar and, seems to me, much less risky environment,” he said.