Puerto Rico Takes a Big Bite of the Big Apple

October 1, 2019, New York CityThe Puerto Rico Builders Association takes a  big bite of the Big Apple at the 2019 Bisnow National Real Estate Finance Summit. The National Real Estate Finance Summit is one of the most esteemed, high-level, and best attended event in the nation. This year was no exception with over 300 attendees from finance, capital markets, financial advisory, private equity, and real estate.

The Puerto Rico panel included Ing. Emilio Colón Zavala,  President of the Puerto Rico Builders Association/ ECZ Group,  Eric Berman,  Chief Investment Officer at Lifeafar, Jorge Ruiz-Montilla, Capital Member and Chairman of the Real Estate & Finance Practice Group at MCconnell Valdes, Philip Carroll,  Director of Finance at Royal Palm Companies and Adam Greenfader, Managing Partner of AG&T.

Ethan Penner, best known  for creating the CMBS  market, key noted the event with insight on “high conviction investment themes.”  The Puerto Rico panel drew much interest at the Finance Summit. “We were impressed to hear from the leaders of the financial markets in New York that they see Puerto Rico as a great opportunity,  explained Emilio Colón Zavala. With less than 7% tourism GDP, there is room for 15,000 more hotel keys.’

Philip Carroll of Royal Palm Companies , concurred with the assessment of hospitality demand and explained some of the island’s competitive advantages in Puerto Rico including the ability to leverage Tourism Tax credits with Opportunity Zone incentives. Royal Palm is currently developing a 1,000 key hotel and marina resort on the island.  


Pictured Left to Right: Adam Greenfader, Emilio Colon Zavala, Philip Caroll, Marcial Diaz


The panel received multiple questions throughout the presentation.  Of particular interest, was the level of detail and financial sophistication about Act 20/22. Jorge Ruiz-Montilla explained some of the benefits of the laws and highlighted the island’s economic and political stability.

When asked, “Why now, why invest in Puerto Rico today”, the consensus of the group was clear…the numbers speak for themselves. “Puerto Rico  posted positive economic growth in 2019 and is forecasting a 2.5% GDP for 2020. We clearly hit bottom and with Billions of CDBG-DR money coming to the island in the next few years,  the time is now”, quoted Adam Greenfader, who moderated the Panel.

Lifeafar, a real estate investment and hospitality firm, recently expanded their operations from Medellin, Colombia to Puerto Rico.  “Puerto Rico is a place you can make a real change. Our investors want to make a good return on investment but also know they are helping to make a difference”, quoted Eric Berman.  

For more information about Puerto Rico,. You can join the Puerto Rico Builders Association on October 29-30 at their annual conference. See link attached. https://www.constructorespr.com/convencion/#eventbrite


About The Puerto Rico Builders Association

The Puerto Rico Builders Association is a non-profit organization established in 1951. The PRBA is the local chapter for the National Association of Home Builders (NAHB) and the Urban Land Institute (ULI). We proudly represent the leaders in housing, commercial and industrial and tourism sectors. We also represent investors and professionals related to the Puerto Rico’s real estate development and the construction industries. Our main objective is to promote and lead planned development, that is safe and sustainable, as to serve as an a principal productive economic driver motor for our island, in collaboration with the private and public sectors in Puerto Rico.

About AG&T

AG&T is a real estate development and consulting company founded in 1998 with headquarters in Miami, Florida. Our  track record spans over 55 real estate development projects in Puerto Rico, Sint Maarten, Costa Rica, Panama, Mexico, Dominican Republic, and various other Caribbean islands.



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

Join us at the CUNY Reconstruction Conference – Puerto Rico 10.5.18


Reconstruction Conference Puerto Rico 

October 5, 2018, 

As of today, supplemental appropriations for disaster relief add up to a total of $136.1 billion, The Center for Puerto Rican Studies at Hunter College, CUNY, the UPR Graduate School of Planning will convene an event to discuss these opportunities. Currently, an estimated $30 billion of these funds has been distributed, allocated, or obligated for recovery efforts in Puerto Rico. In addition to funds earmarked for disaster relief, there are other federal programs that provide financial support to economic development and could be combined with disaster relief funding to make feasible economic development projects. 

Core federal programs supporting economic recovery in Puerto Rico after the catastrophic impact of Hurricanes Irma and Maria include: 

1. CDBG-DR: The Community Development Block Grant (CDBG-DR) Program may fund a broad range of recovery activities. As of today, $1.5 billion have been allocated as part of the first CDBG-DR grant. The period for public comments to the CDBG-DR Action Plan ended on May 25, 2018 and HUD will respond to public comments by August 1, 2018. A similar process will take place for the other CDBG-DR funds awarded to Puerto Rico totaling $18 billion. 

2  Opportunity Zone: Puerto Rico has been designated as an opportunity zone. Investor in Qualified opportunity funds intended to target economic development and job creation in poverty areas are offered partial exemption for short and long-term capital gains taxes, full exemption of all capital gains if investments are maintained for 10 years. 

3. HubZones: The HUBZone program, run by the Small Business Administration, allows small businesses to obtain government contracts without the “full and open competition” normally required, gives preferential consideration to those businesses in full and open competition and makes businesses eligible to compete for set-aside contracts. On a per capita basis, the total dollar value of federal contracts performed in Puerto Rico is less than in any U.S. jurisdiction, other than American Samoa. Additionally, 6 out of 10 federal contracts performed in Puerto Rico are awarded to firms outside of Puerto Rico rather than local businesses. 

4. Low Income Housing Tax Credits (LIHTC): The LIHTC program is one of the largest sources of new affordable housing in the United States. The program provides tax incentives to encourage private and nonprofit developers to create affordable housing projects. The Puerto Rico Housing Finance Authority (PRHFA) announced a total estimated annual allocation for 2018 to 2020 of $16,038,934 with set-asides of $2,353,698 for nonprofit and $13,685,035 for other projects. 

5. New Markets Tax Credit (NMTC): The NMTC program incentivizes community development through the use of tax credits to attract private investment to qualified low-income communities. Financial intermediaries such as banks, developers, and local governments can qualify to become Community Development Entities (CDE). NMTC investors receive a tax credit against their federal income tax in exchange for making an equity investment in a CDE. 91% of Puerto Rico’s census tracts are NMTC eligible, and 44% of those are also designated “Hot Zones.” However, the program is not heavily utilized in Puerto Rico. Prior to 2016, NMTC investment in Puerto Rico totaled around $110 million dollars, approximately .3% of the total NMTC investment. 

6. USDA Rural Development Programs: The US Department of Agriculture offers several programs to facilitate and fund development of rural areas. Rural communities are often affected by geographic isolation, low-density settlement, and limited investment activity from the private sector. The USDA offers grants and loans, and these could be combined with other federal programs to make rural housing and community development programs financially feasible. USDA programs are underutilized in Puerto Rico. 

HUD to grant $18 Billion for Puerto Rico’s recovery and reconstruction





Last April 9th U.S. Department of Housing and Urban Development’s Deputy Secretary, Pamela Hughes Patenaude, along with Congresswoman and Resident Commissioner, Jenniffer González- Colón, met with the Puerto Rico Builder’s Association’s (PRBA) leadership along with the Mortgage Bankers Association (MBA), Puerto Rico Chapter, the Puerto Rico Bankers Association, and Puerto Rico Real Estate Landlord Association.

During the meeting the group spoke about the status of Puerto Rico’s recovery and reconstruction process after hurricanes Irma and María made landfall last September. Among other topics, Hughes Patenaude made a significant announcement of $18.4 billion to be granted by HUD to support long-term disaster recovery for Puerto Rico. It is hoped that this grant will help rebuild communities impacted by past disasters and protect them from major disasters in the future.

The funds are to be provided through the Community Development Block Grant Disaster Recovery Program (CDBG-DR), which grants support to a variety of disaster recovery activities including housing redevelopment and rebuilding, business assistance, economic revitalization, and infrastructure repair.

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