Caribbean Property Magazine 2012 by Hiltop Publications Ltd

Contents

Acknowledgements

FROM THE EDITOR Sometimes We Undervalue What We Have

ANGUILLA A Gem Uncovered Anguilla: A Bjoux Hideaway

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ANTIGUA Nadia Dyson Provides An Insight

BARBADOS Luxury Real Estate In Barbados - Alleyne Real Estate Fractional Ownership Apes Hill Club Is Sensational Dwellings Design Studio

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BRITISH VIRGIN ISLANDS Edward Childs Has The Inside Story

CAYMAN ISLANDS Tamara Siemens Gives CPM an Overview Of The Market Own A Piece Of Paradise

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DOMINICA Cicely Lees Provides An Insight Into This Beautiful Island

ST. KITTS & NEVIS Brian Kassab - A Year Later

ST. LUCIA Local Realtor Ollie Gobat Sees Many Positive Signs LuxuryHome Buyers Find Paradise...

Caribbean Property Magazine, is a Caribbean production published by Hiltop Publications Ltd, 11 Cottage Ridge, St George, Barbados. Tel: (246) 228-9122 Fax: (246) 228-0243 email: sportingb@caribsurf.com Distribution: Jan Musi - Antigua, St. Kitts & Nevis, Pamela Hiles - Trinidad & Tobago, Barbados, Canouan & St. Lucia Important Websites: www.caribbeanpropertymag.com www.caribbeanpropertysearch.com www.sportingbarbados.com www.barbadospropertynews.com Editor: Clarence Hiles Advertising: Pamela Hiles Design: 809 Design Editorial thanks to Paul Doyle, Nadia Dyson, Cicely Lees, Edward Childs, Tamara Siemens, Ollie Gobat, Brian Kassab, Jennifer Atkinson, Iknins Clarke, Anita Ashton, Neil Russell, Nick Parker, Rolf Phillips, Ben Crayston, Sanjay Amin, David Alleyne and Robert Hoyle. Unless stated otherwise, the other editorial is attributed to the editor. Photography Thanks to the various developments for their permission to reproduce photographic material. Copyright: Caribbean Property Magazine 2012 Volume 11. The material and editorial content in this publication was deemed correct in March 2011 when it went to print. The publisher accepts no responsibility for any change or error and recommends all readers should verify the current details direct with the advertiser and where appropriate seek professional advice. No part of this publication may be reproduced without the consent of the publisher.

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BUSINESS & FINANCE SECTION More Positives Than Negatives - CLARENCE HILES The Caribbean Is Very Special - JENNIFER ATKINSON Deloitte Offer Quality Tax Advise - IKINS CLARKE Road To Recovery From The Top Down? - BEN CRAYSTON Market Update - ROLF PHILLIPS Protect Your Home From Burglaries - DAVID ALLEYNE You Can Still Get A Mortgage - ANITA ASHTON Perception And Reality In Caribbean Construction - SANJAY AMIN Caribbean Sports Tourism In Focus - NEIL RUSSEL Virgin Leads The Way - NICK PARKER How To Build Economically In The Caribbean - ROBERT HOYLE 4

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COVER IMAGE Zemi Beach - Anguilla Compliments of Zemi Beach

FROM THE EDITOR

Sometimes we undervalue what we have Moving into the 5th year of global economic decline hardly bodes well for a publication that promotes second homes and a healthy tropical lifestyle, two of the core ingredients of luxury living. Luxury items were the first commodities to be jettisoned when recession hit the headlines in late 2007 and every year since economists and journalists have battled with sparse data to put a positive spin on the year ahead. The battered cliché of “green shoots” has been crushed time and time again by reality, and realistically it is a step into the unknown to predict anything other than another tough year along the road of recovery. The good news is that recessions come in cycles much like interest rates, and if it is true that “recession ends when people start to buy” then there are positive signs that better days lie ahead. More and more realtors across the region have reported more interest than 12 months ago, and the sales

have started to trickle. Perhaps a long way from the rampant early 2000s, but the treadmill has to start slowly and build up pace as the market improves. The visionary and professional realtors and developers have already adapted to the changed environment and if any lesson has been learned from the global economic downturn then it is that new buyers will be a much more discerning and cautious group. Confidence has been eroded by some appalling disclosures at the highest level of financial institutions and investors have become a lot more prudent with their hard-earned savings. And who could blame them after what has happened in the greedy sordid world of financial services? The Caribbean region is a 6

minnow in the fast moving world of high finance, investment and commerce. But therein lies its beauty, and while the investment gains may not be astronomic, the risk is lower and the ancillary rewards are immense. If you buy a second home in the region for investment then you make a calculated decision based on your own due diligence and advice. If you buy a home in the region for lifestyle, then you are almost 100% certain to make the right choice, as you already know what you like, what you want, and what you can afford. After all, despite what has happened across the world, the Caribbean islands have not changed and their beautiful sand, sea and sunshine continues to be as predictable as the sun rising. In simple terms people

The Caribbean region’s greatest assets will always be its natural attributes and its people, and therein lies the challenge for governments and businesses to improve and protect the environment...

who buy a Caribbean lifestyle know what they are getting and they are rarely disappointed. They don’t need speculative rental guarantees, government concessions, huge discounts and citizenship offerings to attract them because they have already visited the destination and fallen in love with the location and its people. There can be no greater endorsement. Sometimes we undervalue what we have. The Caribbean region’s greatest assets will always be its natural attributes and its people, and therein lies the challenge for governments and businesses to improve and protect the environment with all the fundamentals of a stable society and a buoyant economy, even in tough times. The tourism industry must be protected at all costs as it is the main economic thread throughout the region, but it has to be better administered, improved and enhanced. Governments and associated industries must drive the process, but it has to involve all the people.

It is blowing in the wind to promote tourism as a national asset if everyone in society cannot share in the concept, benefit from its resources and ultimately reach a higher standard of living. All the people must benefit from overseas investment right across the economic spectrum not just the rich and famous if tourism is to become a national treasure and a viable and sustainable industry. The economic windfall could be more tourists, more jobs, less crime, more overseas investment, better facilities and amenities, and a higher quality of life for everyone. It won’t happen overnight, but the process has already started in some regions with educational campaigns to highlight the importance of everyone being part of the tourism product. At the end of the day the buyer will make the decision whether to holiday or to buy at a destination and perhaps even retire in the region. Some governments make the process easier than others with no purchase tax, no punitive residency taxes or licenses while

others see it as a short-term fundraiser. With limited resources this may be a shortterm gain, but do islands really need to offer expensive citizen packages to attract new residents and by doing so are they attracting the right kind of investors? Food for thought. Lifestyle is the big attraction of the Caribbean and enhanced lifestyles are the buzzwords in modern real estate marketing. Medical tourism, eco-tourism, sports tourism and Diaspora tourism are niche markets of growth, but the fundamentals of a quality lifestyle are still the key factors when buying a second home. In this edition we have highlighted nine Caribbean destinations and having spent time in all of them we are confident the articles will attract people to visit and perhaps buy. We trust you will enjoy the articles and let’s hope our next edition is able to report another positive year on the road to recovery. Best wishes,

Clarence Hiles Editor

Anguilla

Anguilla... A Gem Uncovered.

POPULATION: 13,600 SIZE: 35 sq. miles CAPITAL: The Valley CURRENCY: East Caribbean Dollar LANGUAGE: English LOCATION: One of the most northerly of the Leeward Islands in the Lesser Antilles, lying east of Puerto Rico.

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excessive and unharmonious development. As economic ties between the Caribbean region and the US and Europe are traditionally strong, the latter’s economic prospects will greatly influence the Caribbean and Anguilla’s outlook in both tourism and sales of real property. After expanding by 1.7% in 2010, real GDP growth in the region (in nominal GDPweighted average terms) will pick up to between 3-3.5 % in 2012. (Scotiabank Regional Economic Outlook Executive Briefing, 2/11/2011; developing economies: rates of growth of real GDP; & 2002-2012 United Nations Economic Situation 2011. With over 20 million Caribbean arrivals and more than US$22 billion in tourism receipts annually, the tourism industry is by far the main employer and foreign exchange earner in the region and in Anguilla. As tourist arrivals are linked to all facets of the economy, the tourism impact directly relates to the absorption rate and the value of real property. The Caribbean Tourism Industry has been recovering since September 2009; according to the World Tourism Organization,

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Anguilla, one of the most sought-after second home destinations in the Caribbean is recognized, not so much for what it has, as for what it doesn’t have: no gambling casinos; no jet skis; no large cruise ships; no fast food chains. This “vision” for Anguilla’s tourism development was carefully and meticulously crafted by the leaders of the island almost 40 years ago, and that vision continues to define the pace and structure of Anguilla’s tourism development today: a tourism that is low-density/highluxury; that facilitates the inclusion of Anguillians in the development process; and that ensures the participation of its people at all levels of the workforce. Anguilla’s devotion to the vision has proved prudent for the island and has contributed to greater stability of real property values compared with other more “commercialized” Caribbean islands. Not totally free from hardships of the global recession, Anguilla has itself experienced its own series of chaotic development manifestations. However, it has avoided the damage done as an effect of

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Local realtor Steve Haines has no trouble selling the virtues of this tropical paradise

The Caribbean Tourism Industry has been recovering since September 2009; according to the World Tourism Organization, visitor arrivals were 3.9% higher in 2010 than 2011. visitor arrivals were 3.9% higher in 2010 than 2011. Meanwhile, the World Travel and Tourism Council estimate that real GDP growth stemming from the tourism industry will reach an average of 4.1% over the next 10 years. News about Anguilla’s visitor growth was reported by Hubert Hughes, Anguilla’s Chief Minister and Minister of Finance in his budget address delivered in December 2011 “Due to the hard work of my tourism team, our arrivals are rebounding and we expect steady growth in that industry thus providing more opportunities for our people,” he stated.

Our experience at Trophy Properties Ltd has been that visitor growth mirrors current and forecasted real estate sales volume on the island. We are an Anguillan based real estate firm and the Exclusive Affiliate Trophy Properties Ltd. of Christies International Real Estate and member of the National Association of Realtors. Although Anguilla does not publish official real estate transaction statistics, our data indicates real property and in particular residential vacation home sales have doubled over the last 12 months. We project the same growth pattern in real

property sales over the next 12 months, especially as various Resort Community Development components on the island take shape. The Resort Residential ownership segment includes the Jumeirah Golf Resort & Spa (plans include the island’s first marina and on-site customs), the Viceroy Resort & Spa, Solaire, the Zemi Beach Resort, the Fountain and others. Anguilla’s dedication to its exceptional and refreshing “Vision” makes for an extremely positive outlook for real property here both in the short and long term, but only for those that share the “Vision”! We welcome the opportunity to learn about your goals so that our team can find your dream home in paradise.

Steve Haines is Managing Director of Trophy Properties and is located at Bedney Plaza on the West End. He can be contacted at www.trophyproperties.net or 264-476-1559 or 264-476-1556.

Anguilla: A Bjoux Hideaway The Caribbean is abuzz with the latest property news from Anguilla; the launch of a boutique beachfront resort which is set to increase the profile of this already exclusive island. by Nicole Rapaport

Adored by the international glitterati and discerning property investors alike, Anguilla is an island famed for its beauty and privacy. Stars from Beyoncé to Paul McCartney have been known to enjoy sumptuous vacations here and this year the launch of Zemi Beach is poised to set the bar for luxury

Caribbean property. Situated along 1,000ft of Shoal Bay East, named by The Discovery Channel as one of the worlds best beaches, this intimate 5.25-acre site will comprise 10 buildings with 73 one-, two- and threebedroom freehold residences. Prices start at $608,000 for a onebedroom 1,200 square foot

property to $2.9 million for a 3,500 square foot three-bedroom beachfront condo. Sales Director Naomi Cambridge says: ‘We’ve already seen a great deal of enthusiasm on the international scene for properties at Zemi Beach from buyers who have been waiting for a stable project of this calibre to launch in

The concept behind this upmarket residential resort is the creation of well-known Caribbean architects Lane Pettigrew Associates. Pettigrew is an awardwinning architect who has designed over 60 luxury resorts and many more private homes in the past 30 years. Adding a modern twist to compliment the traditional Caribbean style, the residences have been designed to maximise indoor and outdoor living with sweeping verandas and infinity pools. No cars will be allowed around the resort, instead golf buggies will be used, to ensure tranquillity and eco-friendliness. Unrivalled facilities for a laidback lifestyle It’s a tough life in paradise, and for those who like nothing more than a secluded vacation, Zemi Beach can offer you just that. Each property will benefit from complete privacy and is designed

culinary requirements in the privacy of your own home. As with any investment in bricks and mortar there will be maintenance charges. The service charge is $1.25 per square foot per month, so for the smallest size property you’re looking at a fee of $1,500. This cost covers a large list of maintenance fees including utilities, insurance, security and maintenance of the Residence exterior and pool, so you can rest assure that your property will be well looked after. The resort also benefits from a comprehensive, optional rental programme. Owners will receive 45% of the rental income from their unit and are entitled to stay for up to 56 days a year (28 days in high season and 28 days in low season). Naturally there are different rate categories based on property size and location.

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...the residences have been designed to maximise indoor and outdoor living with sweeping verandas and infinity pools.

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to achieve an atmosphere where high tech meets beach chic. From large terraces and private plunge pools to jack-pack universal technology hubs and a bespoke iPad Application, which provides access to resort information, special notices and restaurant and spa bookings from the comfort of your own residence, every last detail has been thought of by the Zemi Beach team. There’s also a luxury 2,500 sq ft spa with a Jacuzzi, indoor/ outdoor pools, a relaxation area and four private rooms, where residents can enjoy a variety of treatments. Other facilities include a juice bar, top of the range fitness centre with an outdoor yoga terrace and 24-hour concierge service. For those in search of a retreat, why not arrange for the chef to cater for all

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Anguilla. This is one of the newest and most exclusive developments the island has seen for a while.” For prospective second-home owners Zemi Beach offers an unrivalled opportunity to buy into a charmed lifestyle. The residences are to be set in lush gardens surrounded by cascading swimming pools and tropical courtyards, transporting owners to their own piece of paradise. Each of the properties will afford spectacular views of the Caribbean Sea and Fountain Cavern National Park – an historic cultural site which legend has it is home to the original Fountain of Youth. It was here that three-pointed ceremonial stones known as ‘Zemis’ were uncovered, which inspired the name of the resort.

Anguilla is a boutique Island with limited hotel inventory and particularly high room rates. This is a big boon to owners at Zemi Beach as not only will they have a beautiful beachfront vacation home on a glorious Caribbean island, but when not personally using the residence, it will be managed by a specialist boutique hotel operator, ensuring the most is made of this exceptional property. What’s more, the Anguillian government has granted purchasers participating in the rental programme at Zemi Beach a waiver on the Alien’s Land Holding License Fee until December 2016, meaning that owners will benefit from a huge saving of 12.5% when acquiring property here.

The Developer Zemi Beach is the first international project by the Goldstein Family, one of New York’s most respected real estate developers with 45 years’ experience in the property industry. Its construction will provide over 300 jobs and then a further 130 when the resort is operational. Sheldon Goldstein, the head of the family and founder of the property businesses, comments: “As our first development outside of the US, we were determined to choose a premier destination which would be appealing both as an upscale second-home and vacation destination. Anguilla is an exceptionally beautiful and a truly exclusive Caribbean retreat, which is protected from over

development as the government has limited construction to upscale and boutique resorts. At Zemi Beach we believe it is essential to support the community and provide local employment to create a sustainable development.”

Island Life When you fancy a wonder off the beaten track, Anguilla has abundance of different things to do; from 33 white sand beaches to explore, to sailing, water sports and diving. Take a hike around the island to observe the geographical and cultural sights. If you’re a fan of haute cuisine, Anguilla’s eclectic dining scene provides a variety of gastronomic offerings with over 70 experiences ranging from

extravagant eateries, intimate gourmet seaside restaurants to casually chic beachfront bistros and affordable roadside grills. Known as the ‘cuisine capital of the Caribbean’ Anguilla’s concentration of exceptional fine dining restaurants has been compared with those in New York. End the day with a deserved drink and some live music at the Dune Preserve bar and restaurant, owned by Anguilla's most famous resident, reggae star Bankie Banx, For more competitive activities, the celebrated Greg Norman designed, 18-hole championship golf course has been dubbed ‘the Caribbean’s answer to the 18th at Pebble Beach’. With stunning views of neighbouring St

Maarten, this spectacular course has water hazards on 13 of it’s 18 holes and a narrowing fairway on the 1st that descends some 40 feet to a tight green carved out of native shrub. The 16th plays straight into the trade winds and is surrounded by water and protective deep bunkers, providing even the most experienced golfer with a tough challenge. Or, if you fancy a bit of island hopping and a different Caribbean flavour; the exclusive island St Barths is only 15 minutes by plane.

Getting There

sister islands Mustique and St Barths, it’s airport can only take small planes which helps to keep it so exclusive. Hub through Antigua, Guadeloupe, Puerto Rico and St Maarten direct from almost anywhere in the World and then hop on a small connecting flight to Anguilla. There’s also a 15-minute boat charter from St Maarten. This island of Anguilla may be tiny but what it can offer above other islands, and in particular the outstanding beauty of Shoal Bay East, is the level of unprecedented privacy. It is intimate and exclusive, natural and unspoilt; the ultimate bijoux hideaway.

Getting to Zemi Beach is quite the glamorous adventure. Like its

For more information on Zemi Beach in Anguilla contact: +1 264 235 1879 or visit www.zemibeach.com

Antigua

Antigua returned to positive growth in 2011, which has continued to 2012. The Antiguan economy experienced solid growth from 2003 to 2007, reaching over 12% in 2006 driven by the construction boom in hotels and housing associated with the Cricket World Cup and easier tourist access to the Caribbean. In 2009, Antigua’s economy was severely hit by the global economic crisis, suffering from the collapse of its largest financial institution and a steep

POPULATION: 80,000 SIZE: 108 sq. miles CAPITAL: St. John’s CURRENCY: East Caribbean Dollar LANGUAGE: English LOCATION: In the Leeward Islands between the Greater and Lesser Antilles about 37.5 miles north of Guadeloupe. 21

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neighbouring islands, which means that the prices of houses are comparatively low. It is still possible to buy a waterfront property for under US$250,000. Antigua has a number of direct travel routes to Europe and the US while still having many areas of land completely undeveloped, which gives rise to the potential for steady growth over time as the Caribbean becomes more and more accessible to more people as a holiday destination or investment opportunity.

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It was four years ago in 2008 that Antigua reached the peak of the market. Properties were in significant demand all over the island and the market was shaped much more by the sellers of the properties who could almost choose to sell at any point and gain their full asking price. Obviously things have changed with the global financial downturn and now the negotiation power is very much in the hands of the buyers as opposed to the sellers, this has meant that the savvy buyer is now able to pick up a property for considerably less than it would have been a few years ago. With crystal clear waters and 365 of the best beaches in the Caribbean, Antigua has so much to offer for the homeowner. But it’s not just the beaches and the sea, the island is small and very welcoming with a real sense of community, it’s very easy to feel at home here. The infrastructure is well established with good schools, hospitals and police so that life is not so much different in those respects to the US or UK. It is also a relatively undiscovered and commercialized island in comparison to Barbados and other

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Nadia Dyson has worked in the real estate industry in Antigua for seven years and provides an informative insight into the current real estate market on the island…

Although there has been a real down turn in the property market the rental market in Antigua is booming. decline in tourism. This decline continued in 2010 as the country

struggled with a budget deficit. However, Antigua returned to positive growth in 2011, which has continued to 2012. Most of the tourism industry has survived well during the recession, almost all businesses have been effected to some extent but in many respects this lean 22

period can be seen as beneficial as it has made those providing services to tourists work harder and provide better value for our visitors. The recession has shaken up the industry and made operators really value their customers, those who havenâ&#x20AC;&#x2122;t have gone, and the remaining players

are good quality, professional and not out to make a quick buck. Although there has been a real down turn in the property market the rental market in Antigua is booming. This is mainly due to our current homeowners reducing their rates to fit with travelersâ&#x20AC;&#x2122; budgets. Just as hotels slashed their prices during the recession, we did the same and now we are fully booked through the season. There are a great many rentals booked during the off-season too,

which is providing our owners with a good return on their investment. There are also a number of new and exciting incentives being launched in 2012-13 for those looking to Antigua to invest. Unfortunately as with all large developments, the planning phase details tend to be kept on a need to know basis and out of the public eye. All I can say is watch this space.

Nadia Dyson has worked in the real estate industry in Antigua for seven years and launched Luxury Locations in May 2009. Originally from Kent in the UK she now lives at Jolly Harbour. She offers her clients a personally tailored service with a level of customer care unprecedented in the real estate sector. Taking pride in her excellent bespoke service to both vendor and buyer Nadia seeks to retain only the finest properties available in Antigua. She can be contacted at: Tel: (268) 764 5874 or Email: nadia@luxurylocations.com or via Luxury Locations Estate Agency Jolly Harbour and English Harbour, Antigua Email: info@luxurylocations.com www.luxurylocations.com http://www.luxurylocations.com 23

Barbados

...the creation of the Sandy Lane Estate and Golf Course in the late 1960s has changed the face of the property market in Barbados forever Investors focused on the establishment of hotel products and it is this development which has solidified the islands’ reputation as possibly the top luxury destination in the Caribbean. Most of the new real estate developments during this period targeted the middle market with communities such as Sunset Crest in St. James, Rockley Resort in Christ Church, and Heywood’s in St. Peter.

POPULATION: 285,000 SIZE: 166 sq. miles CAPITAL: Bridgetown CURRENCY: Barbados Dollar LANGUAGE: English LOCATION: The most easternly of the Caribbean Islands and the first port of call for sailors crossing the Atlantic. 27

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product that included a Homeowners Association, golf course, and a shared beach facility. The next two decades saw little significant change in real estate in Barbados as the island worked to reduce its reliance on sugar as a foreign exchange earner, and instead set sights on tourism and International Business.

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Barbados has long been regarded as the gem of the Caribbean, boasting safety and security; friendly people; an outstanding climate, and stability both politically and economically. These factors, among others, have all played a large part in establishing what can now be considered a truly diverse luxury real estate market with product varying from one bedroom apartments to large beachfront and inland estates. It is interesting to examine the stages of development of this unique market segment over the years. The island’s popularity as an exclusive holiday destination has grown exponentially and discerning travellers, primarily the English, have always recognised Barbados as an ideal place for a holiday home. As Barbados’ first luxury estate development, the creation of the Sandy Lane Estate and Golf Course in the late 1960s has changed the face of the property market in Barbados forever themed around a challenging 18 hole golf course, the Sandy Lane Estate set the stage for everything else that was to follow with a

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Luxury real estate Barbados

There was a dramatic shift in the early 1990s when plans were announced for the groundbreaking of Port St. Charles Marina, Royal Westmoreland Golf Resort, and Sugar Hill Resort Community. These unique developments can be considered trademarks of the real estate market in Barbados today â&#x20AC;&#x201C; each themed around a particular lifestyle, they offered prospective investors and holiday makers new and exciting alternatives to property ownership on the island. They added great value to the holiday experience by offering shared amenities such as tennis, golf, boating, fitness centres and

spas. These onsite amenities coupled with booming world economies proved to be the perfect fit for discerning purchasers who demanded the ultimate combination of lifestyle and real estate. In the early 2000s the beachfront condominiums gained massive popularity. In fact, the market went through another shift seeing a number of property owners selling their larger homes and purchasing three and four bedroom beachfront condominiums. Owning a condominium on the beach resulted in fantastic levels of capital appreciation with the added 28

benefit of a reduction in expenses when compared to large stand alone homes. The luxury real estate market continued to expand at a tremendous rate with the addition of developments such as The Crane Residential Resort, Saint Peterâ&#x20AC;&#x2122;s Bay, Apes Hill Club, and a plethora of new condominium projects along the West and South Coasts of the island. Recent years have seen the condominium boom spreading to the South Coast of the island with developments such as El Sol Sureno, Oceans One and Maxwell Beach Villas along with more recently completed developments

such as Palm Beach, Sandy Hook, and Sapphire Beach. These communities offer impressive quality with much reduced price tags when compared to their West Coast counterparts. Up to the end of 2007 it was estimated that the island had a supply of over 400 new luxury apartments for sale and it was anticipated by some that it would take one and a half to two years for these apartments to be sold. However, 2008 brought with it a world economic downturn with currency value fluctuations, oil prices reaching an all time high, and commodity prices sky rocketing. Along with almost everywhere else, the UK market was heavily impacted and there was a resulting decrease in property values, reduced levels of liquidity, and confidence.

2000’s. The new focus is on the creation of ultra luxurious properties. The first of these is the impressive One Sandy Lane which comprises eight apartments boasting 9,500 square feet each, all finished to the highest of standards. Presently under construction is the ultra-luxury Palazzate development on the beach in St. Peter ,and also Port Ferdinand an ultra-luxury residential marina. In addition there are a number of in land purchase opportunities at Apes Hill Club and Royal Westmoreland. Looking to the future, Barbados and its real estate has a lot to offer. With many locations around the world in turmoil due to political, economic, and social instability, Barbados is still regarded by many as the ideal location to invest. Through the recession Barbados has maintained a stable economy and a robust offshore business sector. This coupled with excellent weather makes Barbados real estate a smart choice for investors, or for the holiday maker looking for a safe location with good weather to enjoy with family and friends.

For more information on Sales or Holiday Rentals, please contact the Sales Team at (246) 432 1159 or email: sales@jalbarbados.com 29

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During 2009 the Barbados real estate market showed a marked decrease in the amount of transactions being completed. By 2010, many property owners came to the realization that the status quo no longer applied - if they wished to sell their property, it would have to be priced near to market value and they would need to be willing to negotiate. It had become a “Buyers’ Market”. Through 2011, there was a boost in the number of property sales, most of which reflected prices ranging from 10% to 30% less than pre-recession highs. It is particularly interesting to note that even during the period of reduced activity, sales on the Sandy Lane Estate continued to be relatively strong, proving the point that this pillar of the Barbados luxury market continued to inspire confidence in discerning investors. More and more, there are signs along the West Coast that developers are moving away from traditional apartment style developments seen in the early

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Through 2011, there was a boost in the number of property sales, most of which reflected prices ranging from 10% to 30% less than pre-recession highs.

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The Team at Alleyne Real Estate

Paul Doyle Owner and Managing Director The Crane Residential Resort

Fractional Ownership A smart alternative for vacation property Consumer interest in fractional ownership has grown significantly over the years, with over 6.2 million families now enjoying holidays at thousands of resorts worldwide. For those who have never considered this type of property ownership before, it might be useful to start with a brief overview of the model. A fractional owner buys a fraction or share of a property, paying a one-off purchase fee to acquire the right to use a specific fraction of time annually in the residence, together with an annual fee covering the costs of maintaining the property and any amenities provided. This is an evolution of the basic timeshare concept. However, the key difference between timesharing and fractional

ownership lies in the fact that fractional owners enjoy more luxurious accommodations and receive a tangible â&#x20AC;&#x153;bricks and mortarâ&#x20AC;? asset which may be transferred, sold or willed, as opposed to merely having a nontransferable right to use a property at a guaranteed time each year. Owners may receive either a deed for their share of ownership or a certificate confirming ownership held in trust by a specialist trustee company. With the economic downturn, the fractional model has become a popular alternative to 35

The resort capitalises on the surroundings’ natural beauty with residences to rival the spectacular views, combining 19th century grandeur with 21st century conveniences. purchasing whole ownership of a vacation home. For many, the cost of maintaining a second residence that is not fully utilised can no longer be justified, and more often than not, the hassle of managing property rentals outweighs the benefit. Fractional ownership with its much smaller investment, allows the enjoyment of the second home lifestyle and real estate investment benefits without an outright purchase of the cost of a property. With the fractional model, owners buy the share that is needed annually and incrementally increase (or decrease) their investment as their lifestyles change, letting a management company take care of associated maintenance, taxes and rental. The fractional model also makes financial sense for the person who takes annual hotel

vacations. Typically, after five years, fractional owners will have more than offset the cost of their purchase with their savings on vacations, while also enjoying much more luxurious accommodations than in a hotel. Moreover, fractional owners build equity; or, in cases where they enter a rental pool programme, actually gain returns on their vacation investment. The industry has grown to include many of the leading hotel brands as well as independent developers and resorts, and consumers are faced with a vast range of options. However, the most important consideration in choosing fractional ownership remains the quality of the resort itself and, of course, the cost of the fractional ownership. Consider The Crane Residential Resort on the south-eastern coast of Barbados, which has been selling fractional ownership since 1996. The 125 year old Crane, Barbados’ first resort hotel, stands out initially for its dramatic cliff top setting overlooking Crane Beach – one of the most stunning beaches in the world with its pink powdersoft sand and lush coconut

grove. The resort capitalises on the surroundings’ natural beauty with residences to rival the spectacular views, combining 19th century grandeur with 21st century conveniences. Today, The Crane boasts the original 18 historic rooms and apartments and 166 modern residences which mirror the original Crane architecture, with coral stone walls, timber tray ceilings, and period furnishings. These grand residences, ranging from 800 to 4,000 square feet, feature marble bathrooms with luxurious whirlpool tubs and spa showers; open kitchens with granite counters and top-of-theline appliances; and airy bedrooms with plush four poster king-sized beds, which practically demand lounging. Many residences also feature private pools, some with lush private gardens, and roof decks with barbeque grills. The Crane’s array of amenities includes two award-winning fine dining establishments, three casual restaurants, two bars, a full-service spa, flood-lit tennis courts, a stunning waterscape pool complex, and a glassfronted elevator to Crane Beach. The Crane Village, at the heart of the resort, features duty free

shopping, a convenience store, café, photo studio, fitness centre and banqueting facilities. In addition, residents benefit from free WiFi and VoIP, 24 hour security and front desk, and daily concierge, housekeeping, pool service and beach service. Owners can now look forward to the additions of a Kids’ Club, a sixth restaurant, a movie theatre, and a beauty salon. The Crane is positioned at the top of the traditional hotel industry, having received the American Hotel and Lodging

world [rci.com] and is the only Caribbean resort in The Registry Collection®, which includes only the most luxurious fractional properties and private residence clubs in their exchange network [theregistrycollection.com]. In addition to a Crane owner’s right to use their specific residence at the same time each year in perpetuity, they are also able to easily reserve any type of Crane accommodation for any period throughout the year as required. Through affiliations

very expensive sales practices favoured by the timeshare industry. The Crane lets its product sell itself, always provides its best price up-front and fully respects the right to “think it over.” The resulting savings, along with the fact that The Crane designs and builds everything itself, provide Crane owners extremely luxurious residences at prices that are often lower than ordinary timeshare apartments. For example, a luxuriously appointed, fully furnished and

Association’s AAA FourDiamond Award, granted to only three other luxury hotels in Barbados. Its spectacular location, luxurious accommodation and sterling facilities, have earned The Crane a place as one of the highest quality fractional resorts in the world. It was awarded the highest points values in the world out of 4,500 resorts affiliated with RCI®, the largest vacation exchange club in the

with the two exchange clubs, Crane owners are able to experience vacations in some of the world’s most luxurious resorts and popular destination clubs. The Crane’s #1 rating in RCI® Points, means that fractional owners (even summer owners) are generally able to trade one Crane Week for multiple weeks in RCI’s highest rated resorts. In order to offer the best price possible, The Crane shuns the

equipped two-bedroom residence with its own private garden, large swimming pool and dining gazebo, starts from US$13,395 per week. A further financial benefit of Crane fractional ownership is the expectation of a return on the investment. Owners of four weeks or more have the opportunity to enter The Crane’s rental pool program, which has demonstrated its success by the fact that, for the past seven years,

every Crane owner has covered all costs and made at least a small profit for every week made available to the Craneâ&#x20AC;&#x2122;s rental pool. In addition, unlike typical timeshare properties that decrease in value over time as they are used, Crane owners of over 5 years have, on average, earned a profit on resales after all selling costs. The resort also stands out for the security of its fractional ownership structure. Crane ownership is protected by a third party trust structure

minimal cost. For those consumers who prefer the whole ownership lifestyle, The Crane is still ideal, combining the best of resort living and the flexibility of fractional ownership in a fully owned vacation home. Benefits include wide flexibility for vacation use at the resort, thousands of vacation options through international exchanges and the availability of full turnkey resort services. Many Crane whole owners feel that this last benefit is the best aspect

administered by First National Trustee Company [FNTC.com], which has over US$4 billion of vacation property assets under its management, at over 300 resort developments worldwide. Through FNTC, Crane fractional ownership is in perpetuity and can be willed, transferred or sold at anytime; easily, quickly and at

of their investment since The Crane looks after everything for them; and when they leave, they never have to give it another thought until they are ready to enjoy their vacation home again. Whole owners also benefit from an exceptionally competitive turnkey purchase price which covers everything including

Through FNTC, Crane fractional ownership is in perpetuity and can be willed, transferred or sold at anytime; easily, quickly and at minimal cost.

furniture, fixtures and legal fees. With the Craneâ&#x20AC;&#x2122;s fractional ownership structure, whole owners are also able to enjoy even greater capital gains, flexibility and liquidity on the resale of their whole ownership interest in fractions. This really is the best of all possible worlds.

For more information on fractional or whole ownership opportunities at The Crane Residential Resort, visit thecrane.com or email property@thecrane.com. 39

Apes Hill Club is Sensational Apes Hill Club Barbados has quickly established itself as a world class golf and polo lifestyle community that gets better and better as all the planned amenities and features are added. Apes Hill Club Barbados has quickly established itself as a world class golf and polo lifestyle community that gets better and better as all the planned amenities and features are added. Set in 470 acres of magnificent Barbados countryside the elevated vistas on the golf course are the most panoramic settings on the island and offer unrivalled views of both the West and the East Coasts. The golf course design is

both visionary and creative with full use made of the natural terrain to produce unique designs that will challenge golfers of every standard. The Apes Hill golf course is exceptional and already experts are calling it the best in the Caribbean region. Thatâ&#x20AC;&#x2122;s no small boast given the beautifully manicured and maintained faĂ§ade on top of an exceptional design that has made the most of the natural environment and at 44

the same time preserved it. Apes Hill is set in jungle and pasture with a rich array of vegetation, trees, lakes, quarries and gullies. The polo community is firmly established at Apes Hill with a thriving polo centre and a superb polo field with stunning views down to the West Coast. Apes Hill Club has a full programme of matches against visiting teams during the first half of the year and, Apes Hill teams participate in

business magnate Sir Charles Williams, Landmark Land from United States and Wentworth Golf Club in Surrey, England, one of the household names in international golf. The complex combines high quality sport and leisure facilities with luxury properties to create a unique lifestyle environment. The real estate units on the golf course vary in size and design from custom-built large detached luxurious properties to excellent value semi-detached villas strategically placed beside the 10th and the closing two holes. The polo villas have three en-suite bedrooms and an imaginative

For more information telephone (246) 432-4500 or Fax (246) 432-4501 or Email info@apeshillclub.com or visit the website www.apeshillclub.com 45

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the top UK tournaments during the English polo season. Polo villas are located within a stoneâ&#x20AC;&#x2122;s throw of the clubhouse and owners can enjoy the equestrian ambience every day as ponies work out with their grooms at the polo centre on the far side of the playing field. In time Apes Hill Club will be one of the most elite multipurpose sport and leisure resorts in the world when tennis, fitness, spa, and walking/jogging facilities are completed. In addition, the resort will have a major hotel and a state-of-the-art golf clubhouse. Apes Hill Club development is a joint venture involving Barbados

open-plan design overlooking the expansive polo field and picturesque pond. Owners at Apes Hill Club will enjoy unique status living at one of the most prestigious addresses in the Caribbean region. They can also become Golf Club members and Port St. Charles Yacht Club members, and benefit from concierge services, 24 hours security in a fully secure gated community, and a wide range of sporting and leisure facilities. But it is the stunning golf course that remains the jewel in its crown. It is over 7,000 yards long off the back tees, and at least four holes could lay claim to be the signature hole given their quality, ambience and innovative design. The par-three 12th into the gully at the highest point on the course is magnificent, the par-four slightly dogleg 13th down the side of the rock-face and up to the elevated green is a superb design with a stunning view east, and the parfour 14th through the towering palm trees a photographerâ&#x20AC;&#x2122;s dream. But for many golfers the picturesque par-three 16th across the lake to a green nestled in front of a coral stone quarry and cave is the best. Little wonder the highly acclaimed magazine Golf Monthly described the course as sensational, a wonderful tribute in the world of golf. To play the course is a treat, to live there is a dream, but it is a dream that could be a reality for many people.

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Little wonder the acclaimed magazine Golf Monthly described the course as sensational, a wonderful tribute in the world of golf.

Dwellings Design Studio Whether you’re looking to refresh a room, furnish a new home from scratch or outfit a commercial property, the Dwellings Design Studio is just the place for you. customers looking for a more bespoke solution to access Dwellings’ entire catalogue comprised of thousands of products not available in-store. Their in-house designer, Janine Hinkson, works closely with each client to design a unique interior to meet their particular needs, style and budget pulling items from the plethora of ever-growing interior products available. In addition to the style element, the Design Studio makes decorating an easy and exciting experience by allowing customers

Building on their winning home store concept, Dwellings introduced the Design Studio in 2009 and has since then completed a multitude of residential and commercial projects spanning from sourcing specific products to full turnkey packages. Dwellings is Barbados’ premier home store offering everything for the home including furniture, decorative accessories, kitchen goods, tabletop, bedding and bath all from their beautiful 12,000 square foot showroom located in Millhouse, St Michael. They bring affordable luxury to discerning customers through a selection of stylish, trendy and well-priced products. When shopping here, you’ll recognize many well-known North American and European brands synonymous of quality and durability and you’ll also find tons of unique products and inspiring ideas for your interior. “We always like to keep the showroom looking fresh and exciting with the latest trends to inspire our guests” says Buying Director, Gael Alluard. After a successful first three years with the retail store, Dwellings decided to launch a more customized offer through the Design Studio. This design service compliments the showroom as it enables

We work with local customers as well as foreign customers who have a second home in Barbados. to be as involved in the selection process as they wish without having to deal with any of the hassles of importing and installing the goods themselves. This free design service includes an inhome consultation, a full visual and financial proposal with floor plans and white glove delivery into the home. “We work with local customers as well as foreign customers who have a second home in Barbados. Today’s new technologies enable us to easily work remotely with customers thousands of miles away over the

Dwellings’ latest introduction to the Design Studio is the hospitality section, which focuses on supplying restaurants, boutique hotels and other businesses with the highest standard of commercial grade goods.

Internet, making the whole process much smoother and interactive” says Janine. Dwellings’ latest introduction to the Design Studio is the hospitality section, which focuses on supplying restaurants, boutique hotels and other businesses with the highest standard of commercial grade goods. “Most of our existing lines

already offer hospitality and contract grade furniture, linens, tabletop, cookware and small electrics so it was a natural step for us to build on those supplier relationships and our knowledge of the market to start offering these products to businesses in the region” says Gael. “Our approach to this sector is a very personal one. We use our design skills, our

extensive product expertise and our intimate knowledge of the market to create a unique solution to suit each project. A dedicated account representative then proactively manages the client relationship to ensure everything is delivered efficiently and that items are supplied and replenished as needed.”

You can view more information about Dwellings and the Design Studio as well as their design portfolio at www.dwellingsbarbados.com. Also, if you like interior decorating and want to get the scoop on the latest trends as well as decorating tips, make sure you check out the Dwellings Design blog at http://dwellingsdesign.wordpress.com/ . To make an appointment, call 246-438-5900 x 106 or e-mail design@dwellingsbarbados.com. 50

British Virgin Islands

POPULATION: 27,000 SIZE: 59 sq. miles CAPITAL: Road Town situated on Island of Tortola CURRENCY: US Dollar LANGUAGE: English LOCATION: Part of the Virgin Islands archipelago East of Puerto Rico. There are four main islands and fifty small islands and cays. 57

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managed to keep afloat where regionally many have failed. Tourism, after a couple of slow years, has rebounded. Overnight visitors have again started to increase, although the cruise ship visitors remain in decline. Now four years into the downturn, the BVI, under a new NDP Government elected to power in November 2011, is looking forward to a return to prosperity, although the road ahead may still be bumpy. Historically, the high end of the residential real estate market in the BVI has mainly comprised custom homes built within covenanted residential estates. Until recently there have been few speculative developments and condominium development remains a very small part of the market. With the economic upturn from 2002 to 2007, the BVI did see some limited resort development with the construction of Scrub Island Resort and Marina (opened in 2010) and the commencement of the Oil Nut Bay residential resort community in 2009. Nanny Cay Resort & Marina also started a condominium project which has

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The British Virgin Islands, for those that do not know them, comprise an archipelago of around 50 islands and islets located at the northern end of the Leeward Islands. Along with the neighbouring US Virgin Islands (USVI) and the islands of Culebra and Vieques (now often referred to as the Spanish Virgin Islands), they form an island chain made up of generally small, mountainous islands stretching to Puerto Rico. Renowned as a sailing destination, the BVI has long enjoyed a high standard of living based on the two main stays of the economy; tourism and the financial services. The slow pace of development combined with many undeveloped islands, has allowed the BVI to adopt the slogan “Nature’s Little Secrets”. Visitors to the islands are awed by the spectacular vistas which encompass outlying islands and the many boats that ply the waters between them. Although the recession has impacted the British Virgin Islands in many ways, the Territory has been fortunate to avoid the worst of the down turn. Unemployment remains limited and most businesses have

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Edward Childs has the inside story

sold well despite the market. The small resorts of Frenchmans and Cooper Island Beach Club have both emerged successfully from major renovation projects. Unlike many Caribbean islands, the BVI has not had a failed, partially complete project, as much due to luck as design, as some projects failed to come out of the ground before the economy turned. BVI Home Price Index The following tables illustrate the impact the downturn of the economy has had on residential sales in the BVI. Based on villa sales over US$500,000 from 2003 to 2011, the tables show the BVI Home Price Index and the sales to Belongers and Non-Belongers over the same period. The BVI Home Price Index illustrates the peak of the market in 2008, and the fall off in sales since then in terms of both volume and average sale value. The second table illustrating the division between Belonger and NonBelonger sales (ie those that need

or do not need a landholding licence to acquire property in the BVI), shows that as average sale values have fallen, Belonger investors have become more active. In 2011 Belongers made up 75% of the market. The median sale value was $645,000 in 2011 compared to $895,500 in 2008 with the first sale of a villa over $3.0M closing in late December 2011 at $5.1M helping to boost the average house sale values in 2011. The following table illustrates the sale of villas by price category. The market for villas under $1.0M remains the most active while the market for villas between $1.0M$3.0M has fallen since 2008. The data from the three tables, suggests that as international purchasers have withdrawn from the market since 2008, the local (Belonger) market has increased, albeit for villas mainly under $1.0M. Whilst statistics are a useful guide to the past, they do not reflect the activity of the current high season nor the impact that development activity in the North Sound area of

Virgin Gorda is having on the BVI market. North Sound is a renowned sailorâ&#x20AC;&#x2122;s destination within a sheltered sound located at the northern end of Virgin Gorda. Known for a range of luxury resorts including the Bitter End Yacht Club, Biras Creek and nearby Necker Island, North Sound is now the focus of three major developments. The Oil Nut Bay development by Victor International, an experienced resort developer from Michigan, is now well underway and one of the few resort projects started anywhere in the region since 2007. An all cash development, the developer has reported strong sales activity over the 2011/12 high season. The nearby Yacht Club Costa Smeralda (YCCS), is a new mega yacht marina development, also by Victor International, which is managed by Costa Smeralda, the Sardinian based yacht club. With a number of major events organized at the marina, including the Boats International Caribbean Superyacht Regatta and Rendezvous, now in its second year, the marina will help

attract a new, high end market to the BVI. The third development in the North Sound area is at Mosquito Island, which was acquired by Sir Richard Branson in 2007 and is being developed with his private home where construction on the

first phase of development has begun. With improved financial statistics emerging from North America in the fourth quarter of 2011 and continuing into the first quarter of 2012, there has been an

improvement in the market for high end properties in the BVI, reflected in increased activity over the high season. While it is probably too soon to herald a turn around in the market, particularly with so much inventory available in the $1.0M - $3.0M price range, any activity is a welcome change to prior years. The past two years have seen similar positive first quarters for the general economy only for the summer blues to push back any advances made in the earlier part of the year. If the positive start to 2012 can be maintained over the summer, and into 2013, then perhaps we can at last say that the worst is behind us.

Edward Childs graduated from Newcastle University in 1985 before undertaking a postgraduate diploma in Land Economy at Aberdeen University. Following three years of post graduation in London, Edward became a member of the Royal Institution of Chartered Surveyors in 1990. Edward joined Smiths Gore in 1990 having trained with Savills in London in commercial property surveying. He established the commercial department at Smiths Gore and was instrumental in expanding the firmâ&#x20AC;&#x2122;s presence in the Caribbean region. In commercial property, Edward has specialized in resort and marina operations, undertaking valuations and sales throughout the Caribbean. Over the past ten years, he has also been involved in a range of development consultancy positions, guiding clients through the development process including environmental, planning and governmental issues. He can be contacted at tel: 284 494 2446 or by email: edward@smithsgore.com

Cayman Islands

Camana Bay, a 500-acre development that stretches from sea-to-sea, is living up to its description as a town, with a vibrant lifestyle that exemplifies the very best that New Urbanism has to offer. time realtor who knows and understands the Cayman realestate turf. Local tourism numbers are up; more and more upscale commercial and corporate tenants are securing spaces; for every small business that has been unable to survive the recession, another has

POPULATION: 56,000 SIZE: 102 sq. miles CAPITAL: George Town located on Island of Grand Cayman CURRENCY: Cayman Islands Dollar LANGUAGE: English LOCATION: Comprises of 3 Islands in the Greater Antilles In the Western Caribbean Sea, south of Cuba and North West of Jamaica.

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opened its doors; and there has definitely been positive movement in the property market â&#x20AC;&#x201C; all of this a testament to the extraordinary product that is the Cayman Islands. With the certain upturn of the economic cycle now on the horizon, Cayman is poised to bounce back to its former, prerecession glory. After all, we are an island state with a proven track record in the tourism, finance, and property development industries. Not to mention, a people with a history of survival and success. Caymanâ&#x20AC;&#x2122;s economic future is assured of recovery because there is already secured activity in all of our major industries. Camana Bay, a 500-acre development that stretches from sea-to-sea, is living up to its description as a town, with a vibrant lifestyle that exemplifies the very best that New Urbanism has to offer. This is a community unlike any other in the Cayman Islands, or indeed the wider Caribbean, where everything you need to live, work and play is within easy walking distance. Camana Bay is very much alive and enjoyed by our residents and visitors alike.

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As we move into 2012, and consider the constant economic predictions catapulted our way, here in the Cayman Islands we are already witnessing signs of recovery. This is said not in the spirit of airy-fairy speculation, but rather from a perspective as a long-

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Tamara Siemens highlights Cayman Islands

Cayman Enterprise City, the only Special Economic Zone of its kind in the world, which meets the OECD’s Best Practices Guidelines and complies fully with the Kyoto Convention and World Customs Organization, is poised to be the 21st Century hub for the world’s knowledge-based industries...right here in the Cayman Islands. Strategically positioned in Cayman’s tax-neutral environment and with ideal geographic access to both the traditional markets of

environment that offers the ultimate legislative, geographic and lifestyle benefits. On the tourism front, Cayman is expected to introduce medical tourism to our already vibrant tourism mix. Dr. Shetty, one of India’s most famous cardiac surgeons has already discussed his plans to build a Health City here to attract patients from the Caribbean, United States and Canada wishing to obtain top-quality healthcare at affordable prices.

which rated Cayman as one of the top ten world locations for investors; and a high quality of construction guaranteed by our government, Cayman is the place for high net-worth individuals to live, work and play. And last, but definitely not least, Canadian Banks, including Scotiabank, are prevalent in the local banking system, and it is no secret that Canada’s banks, currency, and real-estate industry have survived the recession

North America and the emerging giants of Latin America, this groundbreaking development will open its first phase doors within the next 24 months. A one million square foot development that features Class A office space together with a range of retail and leisure facilities, this business centre will be situated within an

The luxury property market, given the ease of purchasing procedures, a one-time stamp duty, no annual property taxes, and no restrictions placed on foreign ownership, we expect will experience positive growth this coming year. Additionally, with Moody’s continued AAA rating for Cayman’s economy; a recent CNBC survey,

relatively unscathed. This bodes well for Cayman. Overall the signs indicate that Cayman is well on its way to economic recovery and growth, and with our long-held reputation for being a stable Caribbean nation, Cayman is an ideal and safe choice for property investment.

Tamara Siemens, an award winning realtor in the Cayman Islands, who has enjoyed a successful seven years executive sales career with REMAX, Cayman’s premier realtor. She is a name and a face well-recognised in Cayman, and has a reputation, respected by peers and clients alike, for thinking outside the box and always delivering top-notch service with her trademark pizzazz. Tamara provides a polished level of assistance to both purchasers and sellers of luxury property. She can be reached at 345-926-3430 or e-mail Tamara.siemens@remax.ky . You can also visit the website on www.mycaymanrealtor.com

Own a piece of paradise Scotiabank Cayman can help you bring your dream of a vacation home to life.

ACCESS TO OTHER RESOURCES There are several other professionals that you will rely on to complete your purchase, with our contacts and expertise, we can refer you to: • A real estate professional, who can help you understand the local real estate market and find a vacation property to meet your unique needs. • A lawyer, who understands nonresident home ownership requirements and local mortgage practices. • An insurance professional, who can help you protect the value of your vacation home in the event of theft, vandalism, fire or other acts of nature.

FLEXIBILITY AND STRENGTH We support a number of different vacation home financing options. Whether you’re purchasing an existing vacation home, or buying a lot for future development, we can help finance your purchase and help you through the entire purchasing process! We have mortgage financing tailored to meet the unique and varied needs of vacation home buyers like you. As Canada’s most international bank, and one of North America’s premier financial institutions; the Scotiabank Vacation Home Buyers programme is available throughout the Caribbean, Mexico and Central America. Let us leverage our global strength to bring your dream to life. Our extensive international presence in more than 50 countries, makes Scotiabank a financial provider of choice for residents of the U.S., the U.K. and Canada looking to purchase vacation property. There are numerous ways in which our services can help you secure your place in the sun. Telephone, email or call us to discuss the details of how you can make your dream come to life!

Contact Scotiabank Cayman: Scotia Centre, PO Box 689, Grand Cayman KY1-1107, Cayman Islands Phone: (345) 949-7666 Fax: (345) 949-0020 Email: scotiaci@candw.ky (345) 943-1010 or cayman.online@scotiabank.com www.cayman.scotiabank.com † Some conditions apply. Program details and eligibility will vary by country. This facility is subject to Scotiabank credit approval and verification. 65

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Scotiabank mortgage specialists know that the laws and practices relating to real estate purchases here in Cayman may be different from those of your home country. We will help you go through the special government permits and permissions needed, and plan for the process and timelines which may differ from what you may be accustomed.

Scotiabank is here to help you – every step of the way.

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TAP INTO LOCAL KNOWLEDGE

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You’ve made the trip to the Cayman, and whether it’s the peaceful landscape, the laid back lifestyle, beautiful beaches, or views of a turquoise sea, you’re comfortable and relaxed with the land, people and culture. You’re ready to make a long-term commitment to a home away from home…in Cayman! The Scotiabank Vacation Home Buyers Program was designed to help you and other residents of the U.S., the U.K. and Canada finance the purchase of your vacation home here. We understand that everyone has different vacation property preferences, a different timeline and different location priorities for their home away from home. We can play a key role in helping you finance and purchase, a property that’s best suited to you! Our expert team of Scotiabank mortgage specialists on island can help bring your dream of a vacation home to life. We live and work here in Cayman; we understand local business practices and the intricacies of mortgage financing here on island and so our local knowledge will give you the peace of mind as you buy or build your vacation home.

Dominica

POPULATION: 72,500 SIZE: 290 sq. miles CAPITAL: Roseau CURRENCY: East Caribbean Dollar LANGUAGE: English LOCATION: Southsoutheast of Guadeloupe and northwest of Martinique in the Lesser Antilles. 67

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to push property prices up very rapidly. However, there has not been any sharp decline in property prices in established residential areas such as Canfield, Morne Daniel, Wall House or Castle Comfort where available property is limited, or in areas where the increase has been steadier. At the present time the price of land in Roseau, the capital, is between US$55 and US$74 per sq ft. In comparison with the rest of the Caribbean prices in Dominica have always been relatively low, which makes it a very attractive and affordable country in which to invest. There are still many bargains to be had. For example, it is still possible to purchase an acre of land in the interior and eastern part of the island for US$15,000 or less. If you wish to purchase property for commercial/tourism purposes the banks in Dominica will lend, notwithstanding you are not resident at the time of making the application, provided they are satisfied that the property is a sound investment. In the past it has been more difficult to access funds in

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Dominica is one of the most beautiful islands in the Caribbean. Largely unspoilt much of the interior has untouched primordial rain forest. With 365 rivers and mountains rising to 5000ft. The highest peak is Morne Diablotin on the Mid-West Coast. Some of the scenery is stunning and because of its mountainous nature it was saved from the destruction reeked by sugar cane plantations. Along the coastal areas one finds many charming little fishing villages. The people are friendly and overall the ambience is peaceful and tranquil. The global financial crisis has had repercussions for the Caribbean and Dominica is no exception. There is no doubt that the commercial market is very slow although Safe Haven Real Estate did sell a major hotel towards the end of 2011. There has also been a drop in property prices in areas such as Calibishie on the popular North East Coast, which was subject to rapid growth over the last five years due to an influx of purchasers, mainly from the United States, Canada and England, who helped

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Cicely Lees provides an insight into this beautiful island.

Dominica if you were a nonresident, but this has eased considerably. There are still many good second home and investment opportunities to be had in Dominica and now is the best time to buy, as it is a buyerâ&#x20AC;&#x2122;s market. Dominica remains an excellent country in which to invest with affordable real estate in an unspoilt and natural environment. It is arguably the most beautiful natural environment in the Caribbean and a beautiful place to live. It is also possible for a nonresident to obtain economic citizenship in Dominica. There is no need to invest in property, and because there are no capital gains taxes and no death duties this is an attractive option. The cost of citizenship for a single person is US$75,000.00 and for a family of four with two children under 18 US$100,000.00. In addition the applicant and spouse will be required to pay Due Diligence

Fees. These range between US$5,000.00 and US$10,000.00 Typically someone from the United States or England would pay Due Diligence Fees at the lower spectrum of the scale. Agentsâ&#x20AC;&#x2122; Fees are at the discretion of the Agent. Once an Applicant has successfully passed due diligence, which is undertaken by one of two recognised companies, namely Bishops or Kroll, they will be required to have an interview. This can take place in Dominica, London, New York or Dubai. However, outside of Dominica, the Applicant will have to pay the hotel and travelling expenses of the interview panel on a per diem

Dominica remains an excellent country in which to invest with affordable real estate in an unspoilt and natural environment. It is arguably the most beautiful natural environment in the Caribbean and a beautiful place to live. basis. For more information you can visit the Safe Haven website at www.safehavenoffshore.com Visitors to Dominica come from a variety of destinations. From England they fly with Virgin

Atlantic or British Airways to Barbados, Antigua or St. Lucia and then fly Liat to Dominica. It is also possible to take a Ferry from St. Lucia. From Canada visitors fly with Air Canada or West Jet to Barbados and clients from the United States can fly via Puerto Rico with American Airlines and then American Eagle or Liat to Dominica. Visitors from France usually fly Air France to Guadeloupe and then take a Ferry to Dominica. Air BVI also flies three times a week from St. Maarten. And what a wonderful experience awaits themâ&#x20AC;Ś

Cecily Lees is a UK trained Attorney who read about Dominica 15 years ago and after visiting the island fell in love with it. She later moved to the island and set up business. She is an owner of Safe Haven Offshore and Safe Haven Real Estate with Archipelago Trading Ltd a Dominican Company owned by Yvor Nassief and his wife. Their web site can be found at www.safehavenrealestate.com Cecily can be contacted by telephone at (767) 448 5718/440 0878 or by Email at safehaven@cwdom.dm

St.Kitts & Nevis

POPULATION: 51,300 SIZE: 104 sq. miles CAPITAL: Basseterre CURRENCY: East Caribbean Dollar LANGUAGE: English LOCATION: West of Antigua and south of St. Maarten.

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of Frigate Bay property, as well as other areas of the island. Opened in early 2003, the Marriott was the first major hotel chain on the island and compliments our plantation inns and smaller hotels. Originally hosting over 600 rooms the Marriott itself has seen a change over recent years and now offers time-share and condos within the resort property. Located on beachfront and offering all the amenities expected in any Marriott worldwide the hotel offers guests comfort and security in the knowledge that it is a Marriott Resort. The island offers many attractions to keep visitors as busy as they would like to be such as kayaking, catamaran and snorkeling trips, fishing and diving both on reefs and wrecks throughout our shores. However, if you prefer a lazy day soaking up the Caribbean sunshine you can always enjoy our many pristine beaches. And if you are more a land lubber the island offers rainforest hikes, volcano day hikes, a zip line, mountain biking, horse back riding, scenic railway, Brimstone Hill Fortress,

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Whilst still small and in some ways undiscovered, St Kitts and Nevis is definitely on the map with regard to real estate. Increases in airlift with direct flights from Miami, Philadelphia/Charlotte, Atlanta, New York, San Juan, Toronto, and London have opened up the island to tourism, business development, and investment opportunities. The natural sleepy charm of the island and its people offer a warm welcome whether you are here for a day or to escape the cold back home! Over the past eight years real estate has changed with more land becoming available to purchase in areas such as, Half Moon Bay (Phase 4), Cedar Grove (in the hills behind the airport), Beaumont Park (in the northern part of the island), and of course the South East Peninsula with Sundance Ridge and major land parcels being purchased by the Kiawah Group for the Christophe Harbour development which will include a marina, Tom Fazio golf course and boutique hotels along with individual homes. All of these investments have contributed to the increased value

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Brian Kassab extols the virtues of St. Kitts and Nevis- the twin island paradise.

Caribelle Batik, plantation inns, our history and heritage museums and walking tours to name just a few of the many attractions available to all fitness

levels. For the golf enthusiasts, you can play at the Royal Marriott Golf Course with the course design utilizing both the Atlantic and Caribbean as 72

natural water hazards to test the avid golfer. In due course Christophe Harbour will offer a Tom Fazio designed course when complete and Nevis currently offers a Robert Trent Jones course at the Four Seasons Resort. The island also offers a dining experience to suit all tastes and budgets from the elegant plantation inn experience to dinner overlooking the moonlight dancing on the harbour with the lights of Basseterre across the bay. Other choices are Italian, French, Indian, Chinese, Sushi, and International in the form of Spice Mill, the Beach House, Carambolla, Marshalls, Serendipity, Rock Lobster, Ciao, and La Belle Vie. Many restaurants feature fresh fish and lobster caught that day and grilled over a BBQ. Prices suit all budgets and the vast majority of restaurants are also family friendly.

SE Peninsula One of the largest developments on the island is Christophe Harbour. the Comprising about 2,500 acres this long term project is very much underway with two completed restaurants-The Beach House, beach front villas, land sales and homes being constructed, work being undertaken on the golf course and marina, and a beach clubhouse opened in 2011.

Economic Citizenship by Investment St Kitts offers non-citizens the opportunity to invest in real estate on the island and through this investment to apply to the Government for citizenship. A minimum investment of invested in US$400,000 approved property is required for the application to be considered. Additional costs will be incurred with the application process and many attorneys on the island are available to assist.

B Kassab & Associates - We have been in the real estate business over 16 years and I have watched the island develop considerably in this time. Our office has expanded from being sole operated by myself to now employing 5 full time agents/staff making us the largest Real Estate office on the island. We offer assistance in long and shortterm rentals, property management for owners both on and off island, and sales of all types and sizes of property, homes, villas, condominiums, commercial buildings, and development land. We are ideally suited to offer you the expertise and assistance you may need in finding your dream home away from home.

St. Lucia

St. Lucia is bouncing back

POPULATION: 160,000 SIZE: 238 sq. miles CAPITAL: Castries CURRENCY: East Caribbean Dollar LANGUAGE: English and a little Creole Patois LOCATION: In the Windward Islands between Martinique and St. Vincent 77

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and shops all setting up business in the area. The IGY Rodney Bay Marina has been buzzing this year with restaurants reporting an increase in business, and the yachting sector continues to be a growing part of the tourism product. Two new high quality restaurants have opened up in Rodney Bay Village offering more options for diners, and they have been very well received. There has been a major slow down in new residential developments for obvious reasons, and off-plan investment products have virtually disappeared since the recession. However, existing developments continue towards completion albeit at a more leisurely pace. The Landings, St Luciaâ&#x20AC;&#x2122;s most prestigious up market condo development, is seeking to build its final beachfront homes during 2012 and this will complete one of the most spectacular marine communities in the Caribbean. These will be magnificent homes on arguably the islandâ&#x20AC;&#x2122;s most prestigious real estate location at the beach in Rodney Bay. With the expansion of commercial and business services nearby, the

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Over the last year, the residential real estate landscape in St Lucia has stood fairly still with no new major developments starting. Whilst the stunning natural beauty of St Lucia continues to provide the alluring backdrop for all investments here, 2011 turned out to be a year of continued global uncertainty and as a result, the overseas property market remained stagnant the world over. Understandably this has meant more consolidation than new development. However, the start of 2012 has seen increased interest and more sales taking place than last year, so it seems some people who have been sitting on cash are now tired of waiting to see what is happening elsewhere, realizing that you only live once and perhaps now is the time to buy into the lifestyle they have always dreamed of! The tourist and commercial hub of the island continues to be focused in the Rodney Bay area. A range of commercial buildings have been developed in the last year on the highway between Rodney Bay and Cap Estate, with more banks, lawyers, accountants, bars, restaurants

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Local realtor Ollie Gobat sees many positive signs at the start of 2012

location cannot be bettered and the quality of the complex remains first-class. Jalousie continues its impressive expansion, with its beachfront rooms now open for business and the villas at the front of the property are going up fast. Sales are reportedly going well since the start of this year. For those looking

Despite world recession and the slow crawl to global recovery, investing in Caribbean property is still a sound investment on top of a unique and relaxing lifestyle. We offer quality property with some good deals in all areas of residential real estate and some incredible land bargains for those who want to create their own vision of the perfect Caribbean home. for a home in breathtaking scenery, their villas certainly offer the “Wow” factor. Cap Maison Resort and Spa has only a couple of homes left for sale, and continues to grow in strength, winning more prestigious awards for service in the last year. In Cap Estate, Mount du Cap offers a stunning gated community that is nearing completion. Seabreeze Hills and Seabreeze Heights offer residential lots in amazing rolling topography with ocean views virtually all round and within one minute from the island’s championship golf course. Allamanda development is also showing construction progress on its villas. One new development is scheduled for commencement this year, and that is the Freedom Bay Resort just north of Petit Piton. Six Senses are scheduled to be the operator, and this will bring

more focus to the upscale holiday and residential options in the stunning South West of St. Lucia, where Hotel Chocolat is a welcome recent addition to the restaurant and small hotel scene. During the past year there was a change in government on the island, but the new government has publicly declared its commitment to the tourism sector and this will give prospective buyers and investors the confidence to invest in St. Lucia. Airlift remains strong and JetBlue have agreed to a daily service in the summer from New York, which will be a great boost for our summer arrivals figures. Statistics 78

have shown over the years that when tourism figures are high then real estate sales follow a similar curve so let’s hope for better times ahead. The allure of the island remains strong for those looking for the more authentic Caribbean hideaway, but still with all the amenities to ensure a stress-free and comfortable way of life for those seeking to make St Lucia their second home, or in some cases their retirement home. The dramatic coastlines, lush rainforests, beautiful coves and vast array of bird and marine life ensure St Lucia maintains its reputation as one of the prettiest

islands in the world. Despite world recession and the slow crawl to global recovery, investing in Caribbean property is still a sound investment on top of a unique and relaxing lifestyle. We offer quality property with some good deals in

all areas of residential real estate and some incredible land bargains for those who want to create their own vision of the perfect Caribbean home. The topography of the island ensures there are stunning views from a huge

variety of locations, but the rolling hills and cliffs also ensure St Lucia will remain a lush, green island that will not be overdeveloped. The options are wide and varied for those looking to set up home here. Donâ&#x20AC;&#x2122;t miss the opportunity.

Ollie Gobat is one of the most experienced and respected realtors in St. Lucia and is a member of a highly respected local family that has strong business interests on the island. Educated in the UK he is well grounded in the expectations of overseas buyers and the customer service required to satisfy them. Closely associated with the prestigious Landings Development he is also a keen sportsman. Ollie can be contacted by tel: (758) 452 0422 or by email at ollieg@thelandingsstlucia.com 80

Written by Carrie Coolidge, Luxury Lifestyle & Travel Writer, JustLuxe

Sugar Beach is an award-winning 130-acre resort in a one-of-a-kind location. It is now offering a collection of 42 exclusive private homes with three to six bedrooms priced from $2.4 million to $9 million. At nearly half of the cost of comparable luxury real estate on other islands, such as Barbados, Sugar Beach is a fivestar opportunity that is worth consideration. Nestled in a pristine bay between the Piton Mountains, Sugar Beach is a UNESCO World Heritage Site that offers a level of opulence and services not often found in the Caribbean — or anywhere else in the world for that matter. Situated on the site of an 18th-century

sugar mill, the property was designed by world-renowned Caribbean architect, Lane Pettigrew Associates. Roger Myers, who owns and is developing the property, initially came to St. Lucia with his wife Lee to enjoy a well- deserved retirement. A world-renowned restaurateur, Myers was a cofounder and chairman of the Pelican Group, which owned such restaurant chains as Café Rouge, Dome and Mama Amalfi. After selling Pelican Group to Whitbread, he launched Punch Taverns PLC, which operated more than 6,000 licensed premises throughout the United Kingdom.

An Impassable Opportunity In 2005, Myers was savoring a quiet life in a home he bought on the north end of St. Lucia when he learned that Jalousie was on the market. "As soon as I heard it was for sale, I jumped at the chance to invest in the property," Myers says, "It was a dilapidated hotel in the most beautiful spot. I knew that if I didn’t do something with it right then, I would never get another opportunity like this again." Myers purchased the property with a local partner, who he bought out three years later. It wasn’t just the incredible aesthetic of the island that attracted Myers to it. "The people

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Second home buyers in search of a tropical paradise in the Caribbean, need to look no further than The Residences at Sugar Beach on the Southwest coast of St. Lucia.

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Luxury home buyers find paradise at St.Lucia’s Residences at Sugar Beach

make a big difference there, too," he says. "Most of the Caribbean islands are beautiful, but it is the warmth and the friendliness of the St. Lucians that really make it a special place." It turned out that Myers' status as a visionary isn’t limited to the food and beverage industry — he has earned the same respect in the hotel and property development business as well. In 2010, a London-based consortium, headed by British property developer Anthony Lyons, made a substantial

investment in the development of Sugar Beach. Although developing and renovating Sugar Beach required a sizeable investment of more than $100 million, the resort has since been recognized with countless awards, including first place at the 2010 Conde Nast Traveler Awards (UK) for "Favorite Overseas Americas and Caribbean Hotel" and "Top 10 Resort in the Caribbean" from the Conde Nast Traveler’s 2011 Readers’ Choice Awards. Accolades given to the Residences

at Sugar Beach includes the "Best Property" worldwide award from the International Property Awards sponsored by Bloomberg. Award Winning Architecture Another smart move made by Myers was his selection of Lane Pettigrew as chief architect. Pettigrew, who lives on the island, turned out to be ideal for the redevelopment. "Out of all the projects that I have worked on, Sugar Beach is without a doubt my favorite." says Pettigrew, an award-

World Class Facilities And High End Service

winning architect who has designed more than sixty diverse luxury homes and resorts in over twenty Caribbean countries since 1985. "My architectural approach is a reactionary style to the environment in which it finds itself," says Pettigrew. "One of the things about great architecture is that it takes wholesomeness of the environment in which it sits in. The most important thing is the use of local materials, local

Sugar Beach homeowners have access to all the facilities offered by the resort, including three gourmet restaurants, four bars, tennis and fitness facilities and a scuba center. The full- service spa is especially impressive, as it is located in a series of tree houses hidden discretely within a dense, tropical rainforest setting. The spa was entirely built by hand in St. Lucian style by local Rastafarian craftsmen using traditional techniques. Complete with thatched roofs made from natural, locally grown grass, the tree houses mirror native Arawak Indian huts common a millennia ago. The resort is being managed by the Los Angeles,

For more information about the residencessugarbeach.com, contact the sales office at (758) 285-4181. 85

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California-based Viceroy Hotel Group and will be named “Sugar Beach, A Viceroy Resort” at the end of 2012. Homeowners will be charged a monthly maintenance fee of $1.20 per internal square foot per month, which covers the cost of maintenance for all common areas (as well as external areas for each residence), landscaping services, trash collection, pool cleaning and access to a 24- hour butler service. Housekeeping services and property rental management are also available. Homeowners will benefit from a 15-year holiday granted by the St. Lucian government on income tax at Sugar Beach and a 50% waiver on annual property tax until April 2014. Currently, there is no VAT, capital gains, death duties, inheritance or estate taxes in St. Lucia. It is not too surprising that many of the residences sold to date have been to guests of the resort. "I believe that the mark of successful development is when the people who come leave happier than when they arrived," says Naomi Cambridge, Sales Director. "The sheer number of hotel guests who have chosen to buy here speaks volumes." And having the distinction of being a World Heritage Site doesn’t hurt, either, according to Cambridge. "After all, how many people can say they own a home in a World Heritage Site?" she says. "Long term I think it will guarantee that the few owners who are lucky enough to own homes here will always have an asset that will only appreciate."

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craftsman, local engineering and technology and the use of local knowledge." For the Residences at Sugar Beach, Pettigrew used a classic colonial Caribbean style of design, similar to the traditional homes found in St. Lucia. Each residence has spectacular views of the Caribbean Sea and is equipped with its own private swimming pool and spacious terraces. The most exclusive of the homes offered are located on Glenconner Beach, where five beachfront homes that range from 6,000 square feet to 7,750 square feet in size with five and six bedrooms are set only steps from the beach. Homeowners will have the opportunity to work with Pettigrew to customize the interior layouts to best meet their needs.

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...the resort has since been recognized with countless awards, including first place at the 2010 Conde Nast Traveler Awards (UK) for "Favorite Overseas Americas and Caribbean Hotel" and "Top 10 Resort in the Caribbean" from the Conde Nast Traveler’s 2011

Business & Finance More Positives Than Negatives

CLARENCE HILES

The Caribbean Is Very Special

JENNIFER ATKINSON

Deloitte Offer Quality Tax Advise

IKINS CLARKE

Road To Recovery From The Top Down?

BEN CRAYSTON

Market Update

ROLF PHILLIPS

Protect your Home From Burglaries

100

DAVID ALLEYNE

You Can Still Get A Mortgage

102

ANITA ASHTON

Perception And Reality In Caribbean Construction

106

SANJAY AMIN

Caribbean Sports Tourism In Focus

108

NEIL RUSSELL

Virgin Leads The Way

112

NICK PARKER

How To Build Economically In The Caribbean ROBERT HOYLE 86

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Clarence Hiles

Jennifer Atkinson

Ben Crayston

Rolf Phillips

Anita Ashton

Sanjay Amin

Nick Parker

Robert Hoyle

Ikins Clarke

David Alleyne

Neil Russell

Business

More positives than negatives It has been said everyone has a business brain and that there are only two types of business people-the optimist and the pessimist! If this simplistic approach is applied to Caribbean business then there has been a dramatic change in the outlook of many people over the past four years. One suspects there was an overwhelming majority of optimists pre-2008 and over the ensuing four years that majority has been ferociously eroded by continuous economic decline, political instability and depressing economic outlooks for the future. It takes a lot of self-determination and belief to remain optimistic in 2012, but ironically there are many people in the Caribbean who continue to brave the elements and fight the good fight for recovery in the face of adversity. The pessimists have plenty of firepower in their corner given the magnitude of global economic meltdown, the demise of a number of powerful international financial institutions and within the Caribbean region, the chaos left in the wake of disgraced Clico, British American and Allan Stanford. Pour some IMF and Standard and Poor’s hot sauce onto this already overheated dish and you have a recipe for disaster. Little wonder so many people have been driven into this corner! But the optimist can see many

positives despite the overwhelming evidence to the contrary. After all, our beautiful islands look much the same, the sun rises powerfully every morning and our sunsets are to die for. We have friendly people, low crime rates, high education standards, good social infrastructure and a healthy lifestyle with low stress levels. Tourism figures are on the increase again, and yes things could be better, but they could also be worse. Amazingly, Caribbean people have faith in their future and therein lies the key to understanding how business works in this region. We will bounce back. We can’t ignore the higher energy prices, the lower tourism spend, the increasing public debt and having less money to spend, but life goes on and the region has slowly come to terms with post-recession conditions that were caused thousands of miles away in developed and mature economies. That’s the mystery of global commerce because the spin-off has hit our small island economies with a ferocity that only time and tight monetary controls will eventually negate. Recession wasn’t caused in the Caribbean, but we have to deal with it nevertheless. 88

Banks face a new crisis with high liquidity levels and increasing nonperforming loans, the construction industry has ground to a slow crawl in the absence of overseas second home buyers, real estate sales are low, public debt is abominably high in some countries, and governments need to seriously tackle public sector reform and not tax their way out of the crisis. Little wonder several governments have been toppled in the past 12 months as the people show their distaste for weak leadership and poor fiscal reform. But in spite of the negatives the region has huge assets, not least the quality of life in an idyllic setting. If you want to do business in the Caribbean or make it your home then there is no better place in the world. When you weigh up all the pros and cons the region still wins on many counts. That’s why l remain an optimist! Many thanks to all the feature writers in our Business and Finance section. They come from a wide range of commerce and each person brings an enlightening insight into their industry. Share their thoughts and let’s work towards better times. Clarence Hiles - Editor

Your company has been doing business in the Caribbean for nearly 40 years what is the background? The company dates back to the mid-seventies when our late Chairman Drew Foster established Caribbean Connections after falling in love with Barbados and the Caribbean way of life. Many people with remember Drew with great affection, as he was an effervescent personality who owned the Bamboo Beach Bar on the West Coast, which was a haven for many leading showbiz ands sporting personalities. When the business expanded globally it was re-named ITC Classics although the Caribbean has always been the core element of our business. What services do you provide? We are a Luxury Tour Operator offering tailor-made holiday packages all over the world. We

operate at the top end of the market and our services go far beyond traditional holidays as we deal with clients who want the very best and have the resources to pay for it. Our job is to meet their needs. Would it be fair to say your market is essentially high net worth customers? Absolutely! We deal almost exclusively with senior business executives, celebrities and sports stars. Many of them are internationally known, but for obvious reasons we don’t publicise their holiday arrangements as they want to get a break from the limelight and avoid publicity. In many ways that’s why the Caribbean offers so much appeal to them, as they can live almost normal lives outside the glare of publicity. As an international company

what do you feel the region offers that is special? Caribbean people are very friendly and down to earth, and all of our clients love that relaxed laidback lifestyle. It is something that transcends all of the islands. The region also has some exceptional hotels and restaurants. The West Coast of Barbados in particular is a big favourite with many of our repeat clients. From a personal perspective I feel rum punches made in the Caribbean have no equal! How has the global economic meltdown of recent times affected your business and particularly in regard to the Caribbean? In the early years we suffered like everyone else in the luxury market and our challenges were compounded when our Chairman and mentor Drew

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So says International tour operator ITC’s top executive Jennifer Atkinson. The British-based CEO has no problems selling a region that she absolutely adores…

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The caribbean is very special

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Business

We have the highest respect for our partners in the Caribbean luxury holiday business, both in the UK and in the Caribbean. We find them very professional and they understand the business and the expectations of our clients. Perhaps there are a few frustrations about the laidback approach to some things, but overall it is the Caribbean way and we understand and enjoy it. Most of our clients travel Business Class and they are met at the airports with a “Meet and Greet” VIP Service so they rarely experience Immigration queues and generally enjoy stress-fee arrivals and departures. They are also intrigued at the level of service on the smaller islands where in some cases the Immigration Officer might also be the porter and pops up in a variety of roles. Again, it is the Caribbean way and everyone feels it is part of the overall experience.

Barbados, Antigua and St. Lucia remain the most popular Caribbean destinations, but in recent times Anguilla, St. Vincent and St. Bart’s have attracted special interest. Barbados has been the favourite haunt of the rich and famous for many years and many of our clients love going back every year, but others have soft spots for smaller and more intimate islands or simply new locations. That’s the beauty of the Caribbean as it offers so many different options. Have you experienced a move away from hotels to villa bookings? Most certainly in recent times, but this is probably a reflection of different strokes for different folks. There are magnificent villas all over the Caribbean and some of our clients are prepared to pay high sums for their intimacy and

Your sports company ITC Sports does a lot of business in the region. Does the Caribbean

We cover a lot of top class sport across the world including Formula One racing, the big horse racing meetings, international football finals and of course, major cricket tours. Cricket has been our biggest sporting business in the Caribbean, especially when the England team tours the region. We have also been involved with both cricket and football Legends tournaments, and some horseracing and polo events, but we recognise watersports and golf are sleeping giants across the region, and perhaps more could be done to promote them in the future. That said, the tourism people do a great job promoting their destinations and use their celebrities to great effect at promotional events like World Travel Market in London in November. In your business experience are the signs positive that we are coming out of recession? I feel things are getting better, but it is impossible to set timeframes. Confidence is the key to looking forward and although many of our clients have suffered they still have the confidence that things will improve so they are prepared to spend on a holiday and enjoy a luxury that they have earned. Recessions create change and we all have to adapt, but we also gain strength from success in difficult times and that means we will be better off when the cycle returns to better times, as it surely will. In the meantime, let’s enjoy our holidays!

Jennifer Atkinson has been CEO of leading UK Luxury Tour Operator ITC Classics for three years. She has been with the company seven years after a career in marketing and advertising. Based in Chester and living in Manchester has given her a fuller appreciation of the beautiful Caribbean weather and culture that she unashamedly loves. She can be contacted by telephone at 01144-1244-355421 or by email at jenniferatkinson@itc-uk.com

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Which Caribbean destinations are most popular with your customers?

Any particular challenges doing business in this region?

capitalize on its sports tourism product or could more be done?

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privacy. It is a different holiday experience and money is no barrier if you have particular needs. We can provide all the extras that go with the villa experience from butlers to nannies, from chefs to chambermaids. It may seem outrageous, but some of our clients are prepared to pay as much as US$200,000 per week for the right package. That said, some of the Caribbean hotels are magnificent and meet other needs.

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unfortunately died three years ago. That was our toughest year, but it sparked a remarkable reappraisal of our business and made us return to core values. I remember it well because I took over as CEO and my first priority was to re-focus the business and meet the challenges head on. From our darkest hours we bounced strongly back and now feel very positive about the future. Nobody knows when things will return to normal, but we do know many successful people are still making money and they want to spend it on luxurious holidays in the Caribbean.

Business

Deloitte offer quality tax advice Tax Partner Ikins Clarke answers some key questions H o w w o u l d yo u d e s c r i b e t he services that Deloitte offers to clients and potential clients in the Caribbean? Deloitte provides a one-stop-shop for your financial services needs in the Caribbean, offering practical, tailored solutions through four service lines – audit, tax, financial advisory and consulting. We are a global name with deep regional and local knowledge, positioned to be your trusted business advisor. You are a big international brand, but how big is Deloitte in the Caribbean? With a globally-connected network of member firms in more than 150 countries, Deloitte brings world-class capabilities and deep local expertise to help clients succeed wherever they operate. Deloitte’s approximately 170,000 professionals are committed to becoming the standard of excellence. Deloitte has a strong presence in the countries of the Caribbean and Bermuda marketplace, with more than 700 professionals dedicated to bringing their talents

to bear on our clients’ unique issues. The Deloitte Caribbean and Bermuda Cluster has eight practices located in The Bahamas, Barbados, Bermuda, British and United States Virgin Islands, Cayman Islands, Dutch Caribbean, Jamaica, and Trinidad & Tobago covering the Englishspeaking Caribbean. Although we operate in multiple countries, our professionals have a single focus: to help clients navigate their business challenges and achieve success. Through our proven effective Cluster-wide collaboration, we offer seamless service to our clients via our ‘asone’ strength. Together, we are also committed to working with clients to strengthen corporate responsibility, build public trust and make a positive impact in our communities. Tax is an integral part of property in v es t me n t , b u t ma n y b u y er s neglect seeking advice and do their own thing. How risky is this approach? Advice should always be sought before making any type of investment. This especially

applies to property investment, as there are many unforeseen tax implications that may arise after the investment decision has been made. A person investing in property should be especially aware of applicable property taxes and also of transfer taxes in the event of a sale of the property. Many overseas companies are now relocating to the Caribbean. What are the major attractions available to entice them? The Caribbean is an attractive place for business as it has many unique attributes that are not easily found elsewhere in the world. For instance, the Caribbean’s attractive tax regime, the presence of double taxation treaties, bilateral investment protection treaties and stable political and economic environments, make it ideal for international business. In addition, the Caribbean’s proximity to North America and Latin America, our highly educated work force and quality professional services contribute to the region being an investor friendly location.

Business

A t wh a t s t a g e s h ou l d t h e s e companies contact Deloitte? We would advise companies to contact Deloitte from the time they decide to relocate to the Caribbean as from the beginning we can offer advice to ensure that their operations are structured in a tax efficient manner. We can

also assist in the establishment of the company (incorporation and registration for example) and managing the tax and other compliance obligations while in the Caribbean. It seems th at tax legislation has changed a l ot in recent times. Is th is a major concern?

Tax legislation is constantly evolving and Deloitte ensures that it keeps abreast of all developments and changes so that our clients are always one step ahead. One example of this is the establishment of our FATCA desk and the guidance we can provide as related to FATCA.

Ikins Clarke is a Tax Partner at Deloitte Barbados. Ikins earned a BSc (Hons) in Economics and Management from the University of the West Indies and is a Fellow of the Institute of Chartered Secretaries and Administrators of England (FCCA). He has varied experience in providing tax and corporate advisory services to a range of international clients, focusing on tax planning, corporate restructuring, corporate governance and statutory compliance. He is familiar with local and regional taxation. Ikins has worked for a governmental agency, which promoted small and medium sized businesses in Barbados and in that capacity he provided research and business development advice to various companies in the manufacturing and service industries. He is also trained in insurance and risk assessment having worked at one of the leading insurance companies in Barbados for eight years. Ikins can be contacted at tel: 246 430 6421 or by Email : idclarke@deloitte.com 96

Business

Road to recovery from the top down? Ben Crayston gives his views. A recent upswing in new Private Banking real estate secured loans business could serve as a significant indication that a real estate recovery in being led from the top down. Certainly the most recent quarter yielded some very attractive business, improving noticeably over the previous quarter and the corresponding quarter last year. So where did this encouraging result come from? As is well known, Scotiabank is founded on the strength of its client relationships and its Private Banking business is no exception. We are extremely blessed to be very well supported by our local Barbadian and regional Eastern Caribbean clients, some of whom were seeking financing. Current overseas clients, looking to do a little more here would add to the compliment of established clients we were pleased to assist, again underlining our commitment to firm client relationships. There were also those prospective overseas clients, who were looking closely at the Barbados market for a year or so and, rather than dipping their toes as previously, decided that it was time to take to the warm and enticing, clear and sparkling turquoise Caribbean sea and make their presence and visits here a little more permanent by purchasing property here, with some borrowings to ease the

pocket a little. In summary then, one might suggest it is a conservatively balanced approach to increasing business, which combined during the period for an attractive result, led by interest in the prime real estate market. Note also that the number of enquiries registered in the Private Banking realm for borrowings in excess of USD1million was into multiples of those of the same quarter in the previous year, and we can add some weight to the argument that it is not necessarily just the case of the stars aligning for a one-off performance just passed. This provides a further indication of a positive trajectory on the road to recovery at the upper level. Further evidence of this can be found in Knight Frank’s Residential Research department’s “Barbados Residential Insight” report, which indicates that searches through their website in the US$1million to US$5million price bracket increased over 20% last year, and over 50% in the 98

US$5million to US$15million price bracket. “With momentum in the market improving and the fact that minimal stock has been added to the island’s property market in the last three years, the supply demand-equilibrium is tighter than it has been for some time. Add to this the scale of wealth generation globally and Barbados’s limited inventory, and we expect demand to continue to strengthen, prices to stabilize and possibly rise in the best locations”, says Christian De Maillac, Head of the Caribbean Desk for Knight Frank, in the same report. Looking more closely at the breakdown of nationalities of those considering buying prime property in Barbados, the report further reveals that 59% are European, 27% North American, with Asia, Africa and South America featuring in the remainder. This approximately represents our client country segmentation, with the UK featuring heavily, whilst again our

Ben Crayston is a Financial Consultant for Scotia Private Client Group covering Barbados and the Caribbean East. He works with a team of experts in private banking, wealth management and wealth structuring to deliver the most effective solutions for each client’s unique circumstances. He graduated with a BA (Joint Hons) from Southampton University and has worked in financial services in England and Trinidad before moving with his family to Barbados in 2007. Ben has completed the Certificate in Insurance (UK), the Roytec/Advocis ‘Certified Financial Planner Education Program’ (Trinidad) and the Canadian Securities Course. He is also a committee member of the Barbados Association for the Correction of Learning Disabilities (BACLD), a charity that runs ‘the Learning Centre’, a school for children with learning disabilities in Barbados. Ben can be contacted at (246) 253 5964 or by email: ben.crayston@scotiabank.com 99

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there is some interest from Russia. So far 2012 is proving to be a solid year with value of transactions back to mid decade levels.” It is interesting to compare the experience and sentiment above with the mood summed up in the title to an 11 page report on global real estate trends by Adrienne Warren of Scotia Economics in December, largely focused on 12 advanced nations and average inflation-adjusted house prices entitled, “Global Housing Markets Limps into the New Year”. “There is no denying that there are clients around with money to invest however the price and the property have to be right for a sale to occur. Unfortunately over priced, over supplied or mediocre property isn't getting the same level of interest at this time,” says Richard Young, Managing Director of West Coast Villas Sotheby’s real estate agents. “It is also worth noting however that the top end of the market

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Barbadian clients provide notable additional support, as do those citizens in the Caribbean East territories, including St. Lucia, Antigua and St. Maarten. Private Banking clients and prospects are also showing increased levels of interest in regional luxury markets such as Mustique and Anguilla, underscoring our proposition that the recovery is being led from the top down. Terry Hanton, MD of PCS Inc. the consultancy and development division of Altman Real Estate and an international associate of Savills plc, comments: “The top end of the luxury real estate market peaked in late 2007, in terms of both price and volume. The crash of March 2008 hit volumes hardest for the period to 2011. Prices of properties over (US)$3m fell by an average of 25%, but volume declines were double that. We are now seeing much improved trading volumes but relatively static prices. The short-term price reductions remain, but there are far more buyers from the UK around and

remains strong with either super luxury or unique property still attracting the wealthy looking for only the best…some buyers just want to enjoy the island's enviable lifestyle now (and) are not prepared to wait”. In conclusion, whilst we all know the road to recovery is never a straight one, the signposts suggest the upper echelons of the market are leading the way on the path to recovery. In discussing the profile of our membership, it would be remiss not to take the opportunity to thank all our clients for their business, continued support and ongoing custom and we look forward to continuing to serve your unique needs and further enhancing and developing our relationships through our dedicated team and Scotia Private Client Group services. Scotia Private Client Group provides personalized, customized borrowing solutions for our client’s unique needs through a team of experts approach, encompassing Private Banking, Wealth Management and Wealth Structuring disciplines as determined by each individual client’s specific personal circumstances, goals and objectives. Our local Scotia Private Client Group centre, whilst located in Barbados, serves client’s needs through the Caribbean East also. We would invite you to contact our local Scotia Private Client Group Centre in Barbados through the contact information below to discuss your needs and how we can best assist you.

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Market Update Top Caribbean banker Rolf Phillips looks at the changing banking environment and offers some advice for borrowers in 2012â&#x20AC;Ś The regional residential property market continues to exhibit weakness in many areas underscored by prevailing weak economic conditions in most countries! On the banking side financial institutions continue to pay close attention to their property portfolios to ensure these remain healthy. While levels on nonperforming loans continue to be high the good news is that flows of new loans into the nonperforming category have slowed in the past twelve months! This increased stability has allowed resources to concentrate more heavily on recovery rather than prevention. The greater part of the effort in this area is focused on working with borrowers (who got into difficulty due to loss or reduction in income) to find solutions, which will enable then to recover over a reasonable period of time. On the positive side there is still some demand for domestic residential mortgages. However, the levels are still low compared to the period before 2009. Levels

of demand are even lower for International Mortgages, which is reflective of the low levels on turnover in this sector. Most of the current turnover is focused in the upper end of the second home market. The good news for borrowers is that most financial institutions are experiencing unprecedented high levels of liquidity. Low demand for corporate and retail loans as well as a lack of good investment opportunities is impacting the balance sheets of most financial institutions and creating these very strong surplus funds positions. Most banks are therefore keen to lend to well-qualified borrowers and willing to offer great deals to attract the best loans. Borrowing rates have fallen quite significantly in some markets. The most acute of these is Jamaica driven initially by the restructuring on Government borrowing, but now continuing by competition among banks. Borrowers will find that in most cases the conditions for obtaining new loans are still

restrictive and they should expect to provide a lot more information than in the past. However, the effort is well worth it as the rates on loans and the ability to negotiate good deals is better than it has ever been in this region. Borrowers who are able to meet the requirements are encouraged to use free equity in residential property to obtain lines of credit, which can be used for multiple purposes. Home Equity Lines of credit are becoming increasingly popular in this region and is enabling consumers to borrow at much cheaper rates than before for consumer and other purchases. A line of credit is a very good product to have as it makes borrowing available in case of need on a revolving basis for periods of up to ten years. Current conditions should teach us that borrowing is least available when you need it the most. Having a committed credit line available in case of need is there a prudent practice.

Rolf Phillips is Managing Director Retail Banking at CIBC First Caribbean International Bank and is one of the most experienced bankers in the region. Based in Barbados he travels widely in the region visiting the bankâ&#x20AC;&#x2122;s extensive network of branches and developing new business. An innovative and visionary banker, he can be contacted at Tel: 246-367-2553 or by Email at rolf.phillips@cibcfcib.com 100

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Protect your home from burglaries With crime on the increase, United Insurance COO David Alleyne offers specific advice to Caribbean property owners Today unfortunately the likelihood that your home will be burgled is increasing. Even in gated communities, you are not necessarily immune to unwanted intruders entering your home. That’s why protecting your family and your property is even more of a priority today than ever before. With regard to protecting your home from burglars, there’s the approach which we’ve used for years in the Caribbean and that’s to have a trusted guard dog around. Most dogs as we know, are excellent at letting us know when a potential intruder is around and they can serve as a warning in advance of a possible break-in. But, with the everincreasing sophistication of our burglars today, we also need to become more sophisticated with our approach as well. Thus although many individuals are continuing to depend on a dog for warning, they are also installing security systems to protect their home and families. There are many types of home security systems available

offering a variety of features and functions. The one you choose will depend on your financial circumstances and your security requirements. Most systems are designed to detect and scare off potential intruders by sounding an alarm providing effective protection for the entire home. Thus, you can get a system that detects a window breaking or door opening as well as incorporating sensors which can alert you to movement within or outside the home triggering an alarm or causing lights to automatically turn on. Surveillance cameras can also be employed that will record exterior activity. However, whether you have a security system installed in your home or not, there are other simple steps you can take to protect your home and your family. Popular in the Caribbean are wrought iron grills and gates at windows and doors, and we know that these can definitely help to deter intruders. However, be sure to install grills

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which can open from the inside in the event of an emergency, such as a fire. As Caribbean people, we also love our glass sliding doors; but we need to take extra care to ensure that we place a bar in the bottom track of the doors to prevent the door from being pried open. You should also ensure that two or three sheetmetal screws are inserted into the track above the sliding door and that these screws are adjusted so that the top of the door barely clears them when it is operated. This will prevent intruders from lifting the door out of the track to enter your home. We also enjoy having wonderfully

landscaped gardens around our home to provide beauty and privacy. We must remember however, that bushes and trees near to doorways, verandas and windows, give a burglar somewhere to hide. So you should really plan your landscaping with safety and security in mind. Many of us like to engage in handiwork in and around our homes from time to time. We just have to be sure not to store any ladders where a burglar can use them. And if you keep your bikes, tools or other valuables in your garage, be sure to keep the door closed when not in use. This is especially important where you have a door in the

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One of the key things to do, if you live in a neighbourhood, is to “be neighbourly”. Ask your neighbours to report any suspicious activity they see and you can do the same for them. It’s important to note that good neighbours make safe neighbourhoods. garage which leads directly into your house. It’s just too easy for a burglar to conceal himself in the garage while working on entering through this door. Also, please don’t leave valuables that can be reached through windows without even

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entering the house. Remember, always try to “keep an honest man honest” as they say. One of the key things to do, if you live in a neighbourhood, is to “be neighbourly”. Ask your neighbours to report any suspicious activity they see and you can do the same for them. It’s important to note that good neighbours make safe neighbourhoods. If there’s an opportunity to be part of, or to start a neighbourhood watch, be sure to take advantage of this.

These are just a few of the key steps you can take to ensure that your home and ultimately, your family are protected. Of course, to prepare yourself for the unexpected, you should ensure that your insurance coverage takes into account any damage to your property and the valuables which can be taken from your home. Ideally, you should also review your insurance policy on an annual basis to be sure that all the additions you make to your

home, as well as those family heirlooms which have appreciated in value, are protected in the event of a burglary. Ultimately, we owe it to ourselves and to our families, to take preventative action today and to ensure that we do not, through our own negligent actions, contribute to life’s unfortunate occurrences.

David Alleyne is the Chief Operating Officer of United Insurance and also sits on the Board of Directors of the company. In his role as COO, David is responsible for running the day-to-day operations of United. Prior to his appointment to the Board of Directors and as General Manager in 2008, David was the Overseas Manager, responsible for United’s 13 territories within the region (excluding Barbados), for over 18 years. David is a Chartered Insurer being an Associate of the Chartered Insurance Institute (ACII) of the United Kingdom and an Associate in Reinsurance (ARe) of the Insurance Institute of America. He also holds an MBA from the University of Durham. His service to the industry includes sitting on the Executive Committee of the Insurance Institute of Barbados, lecturing under the Barbados Diploma of Insurance programme (BDI) and serving as a Director of The insurance Association of the Caribbean (IAC). David can be contacted at 246-430-1900 or via e-mail at dalleyne@unitedinsure.com 104

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You can still get a Mortgage! Caribbean Mortgage Broker Anita Ashton provides an insight into the sometimes confusing world of Caribbean mortgagesâ&#x20AC;Ś While it is difficult to include all destinations on the same page, mortgages continue to be available across the Caribbean region despite the continuing meltdown in the financial sector. Global recession took its time to hit the region, but when it did, the consequences were severe for small island economies, most of whom are dependent on tourism and overseas investment for economic survival. The drop in the number of tourism visitors was compounded by the disappearance of the second home investors, a combination of speculators, retirees and genuine purchasers looking for a better lifestyle in warmer climes. But slowly and surely these investors are returning to the market albeit a lot more cautious and wiser about their commitments. It may surprise overseas visitors, but throughout the past four years of financial and economic turmoil across the globe Caribbean lenders have maintained a lending profile and not closed the doors to new business. Understandably

delinquency levels have increased and more and more provision has been made for bad debt, both domestic and commercial, but banks need to lend to generate profits and that is still good news for overseas purchasers looking for mortgages. Mortgage Terms and Conditions continue to vary from island to island, but where the interest rates have been aligned to external rates, the spin-off has been good news for borrowers. The low US$ LIBOR rate has been stagnant for some time and doesnâ&#x20AC;&#x2122;t look like rising too much during 2012 so we should expect non-resident interest rates to remain below 5%. But lenders have increased their margins and tightened their credit controls. Applications are much more difficult to process because of the higher scrutiny, although it seems incredulous to think the slower processing is part of a concerted strategy to reduce or control lending. Certainly the time taken to process applications has increased and from the outside it is impossible

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to determine whether this is intentional or simply the crusty old problem of delivering an efficient customer service. Stories of 6-12 months processing times are not uncommon and lower Loan-toValue (LTV) ratios have significantly lowered the lenderâ&#x20AC;&#x2122;s risk and perhaps taken some potential buyers out of the market. Lenders have also taken cognizance of their risk experience with both developers and borrowers, and understandably dropped the LTV as low as 50% on some islands where their experience has been unsatisfactory. Funding to developers has taken a severe jolt, and many projects have been stalled. The mortgage risk has also been adversely assessed alongside finished developments where ambitious rental returns have not materialised because of the drop in tourism figures, and delinquency levels on Buy-to-Let investments have significantly increased. Caribbean lenders generally will not approve stand alone Buy-to-Let mortgages and expect independent income to

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meet the loan repayments, but when the rental income doesn’t materialise it is usually the mortgage repayment that suffers. The value of using a Caribbean Mortgage Broker in these challenging times has never been more important. Horror stories of Do-It-Yourself non-resident mortgage applications abound, and with a domicile thousands of miles from source it can be a costly and frustrating exercise to communicate let alone negotiate. The scenario is compounded by the involvement of so many other interests including developer, lender, vendor, valuer, attorneys, banker and whoever. The broker’s modest fee set alongside

the services provided is a small price to pay for someone acting solely in the client’s interest and with the professionalism and expertise to deliver the exact services needed in a timely manner. Caribbean Mortgage Services has brokers with over 30 years experience in UK and Caribbean lending and has an excellent network of contacts throughout the region. Services are billed on results and for purchasers the use of someone on the ground to manage a difficult process is invaluable. CMS will provide advice, consultancy, application services and manage the process to completion in addition to

liaising with all the relevant players in the transaction. They will also broker to get the most suitable product to meet the client’s needs and if they can’t deliver a charge is not applicable. There are no upfront fees or hidden costs. Buying an overseas property is a challenging prospect and buying it with overseas finance adds to the challenge. However, the rewards are tremendous as owning a home in the Caribbean is living the dream. Let us help you make the dream come true.

Anita Ashton is a Director of Caribbean Mortgage Services and has lived in the region for over five years. She is a former UK banker with a wealth of experience in retail banking and domestic mortgages. Based in Barbados she regularly visits other islands. Her contact details are: Tel: 246 230 5824 or by Email anita@caribbeanmortgages.com . www.caribbeanmortgages.com

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Perception and reality in Caribbean construction Sanjay Amin looks at the past year and provides an assessment of what may happen in 2012… BCQS International Ltd has been an established cost and value consultancy in the Caribbean construction and property industry for over 40 years, during which time we have built on our reputation as the leading independent consultant of our kind in the region. We believe that our research remains a valuable initial resource to fellow construction professionals, builders, established and first time developers, lending institutions, and indeed, anyone who has an interest in, or reason to follow, the construction industry in the Caribbean. We concentrate on ten jurisdictions, consisting of those countries where BCQS have offices, namely, the Bahamas, Barbados, British Virgin Islands, Cayman Islands, Jamaica, St. Lucia, Trinidad and the Turks and Caicos Islands, as well as those where we had good supplementary local knowledge, namely, St Maarten, and Curacao. Last year, we also anticipated growth in the importance of two of the larger economies within the region, namely Guyana and the Dominican Republic. This has

coincided with the expansion of our business to now include an associate office in Guyana.

Market Overview The downturn experienced since 2008 has continued to make it felt region wide. A large number of construction projects remain on hold while the developers and their funders continue to discuss exit solutions to attempt to unlock what value remains in partially built assets. We have also experienced an increased workload in valuations for foreclosed upon property. The greatest challenge remains the profitable disposal of assets to the market. In recent years up until 2008, many of our jurisdictions GDP’s relied in part, on the sale of income producing second homes to overseas investors, which in turn would bring revenue in terms of purchasing costs and duties, ongoing maintenance charges, bed tax etc. For the most part, the developers of these types of property were aiming their product at individual purchasers from either North America or Europe. With the dramatic shrinking of that

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market, today’s Caribbean developer must be malleable in approach to turning a profit out of real estate. Our research shows that generally across the region, tourism numbers were up in 2011 which is encouraging developers to look at ways of selling a piece of the Caribbean to investors, who would generally not be in a position to purchase an entire asset. This concept of ‘Fractional Ownership’ has been mooted for a number of new developments as well as a disposal solution for underselling existing developments. Only time will tell whether the market will accept and invest in this concept, and funders will be wary of such a structure until a proven sales record develops. Half-poured concrete columns, rusting rebar and the slow reclamation of building sites by indigenous flora are a constant reminder of how the Caribbean has been impacted by global recession. These reminders also remain as a hard lesson to a number of developers and funders who were caught in a rising market, where the actual cost of the asset under construction up to 2008

new construction, which is especially true when considering that cost and value are now not the close bedfellows they were up until 2008. As owners, receivers and funders begin to realize that there is no quick route out of the current

that has historically encouraged so much investment, ensuring a positive outlook for those with longterm vision meaning that now may look like a good time to invest in future profitable capitalization. This year we continue to see a vast disparity in construction costs over 109

the region. What is most interesting is the forecast for declining construction costs up to 2015 as both the global and regional markets take stock of the current and forecasted economic climates. This in turn leads to the reasonable prediction that the property and construction industries will be forced into taking measures to keep their markets moving and generating income. An example of regional government actively looking to mitigate the effects of the recession can be demonstrated by the reduction in stamp duty in property transactions. Some countries are encouraged by positive tourist arrival figures and are looking at demonstrating to the airlines a requirement for increased airlift, which in turn will bring more foreign currency into government and private coffers. Individual governments are also looking at improving infrastructure to service this requirement as well as to put money into the private sector to encourage employment. The most significant change in construction cost escalation occurs in Jamaica, which can be explained by changes in legislation, namely the increase in Value Added Tax and Import Duty as well as a 17% levy on unionized labour costs. It is yet to be seen whether this will be a positive change, but what it does do is raise the cost of construction in one of the hitherto lowest cost Caribbean construction environments. Most other jurisdictions have a much shallower cost increase curve for year 2011, whilst those countries which had seen large profit margins in construction up to 2008 have actually seen minor overall reductions in cost, namely Barbados, TCI and The Bahamas. However, findings show that times remain very uncertain and that costs are fluid, as we predict that most markets will begin to show a reduced construction cost into 2012. Feedback from our

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distressed market, and a return to the heady values realized in 20072008 are ever further away, we may begin to see some more movement in the market as prices begin to reflect real value and while those investors with the biggest teeth and a long-term plan start to take control of the best and most distressed properties. This being said, only with the coupling of more accessible finance and the willingness of individuals to take risk, can we expect to see our regional market begin to generate again. However, the Caribbean remains a very desirable location and retains the charm and beauty

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considerably exceeds any realizable value on the open market today. We should expect to see a number of the heavily distressed assets changing ownership at large discounts over the coming years. Whilst our research has shown that for 2011, construction costs have risen slightly overall, from 2012 we are forecasting an overall decrease in costs up to 2015. The two major components of this are firstly, an overall negative escalation prediction of commodity indexes and natural resources used in the production of materials, and secondly, the natural balancing of the market in terms of demand for

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Business offices however individual demonstrates that Contractors percentage for profit and tender mark up has become slightly more bullish over 2011, and it remains to be seen whether savings associated with predicted reductions on material prices will be passed on to the end customer. Market forces will decide this. The steadiest construction environments can be described as being in those countries, which had not experienced exponential growth from the early 2000’s. Established and organically growing construction environments have of course suffered less than those less mature and reactive jurisdictions. Our figures may suggest that if the pockets are deep enough, the next few years may be a good time to build, however, now more than ever, what this also demonstrates is the importance of achieving best value. This involves the reduction of risk on any construction project through proper project planning, controlled design development and the definition and agreement of construction prices and contractual obligations. The now historic year on year increase in property value is no longer able to mitigate the risks associated with poor planning or performance.

Caribbean Resorts... Opportunity Knocks? All of us in the Caribbean are acutely aware of the effects that the global economic downturn has had on resort investment in the region – but is now the right time for investors to get back in the water? Although we have had our fair share of doom and gloom, there have been savvy investors taking the

opportunity to step into projects that appear to have real value in this changing market. Some have snapped up distressed properties that have been over-leveraged or under-managed, some have picked up deals from defaulting loans and others have recognized the evolution in the resort investment market and restructured their projects to suit. Resort developers must be able to adapt to the changing tourism investment model in order to attract new backing for their projects. In particular, there appears to be a trend away from those concepts relying on residential components as a significant source of financing. Residential condominium products have seen significant reductions in price due to a lack of demand, typically to a level below what the replacement cost would be – therefore discouraging developers from starting or continuing with these types of resort projects. The reduction of second home real estate investment from the Caribbean’s key investment markets combined with falling tourism arrivals and a decline in real estate based project financing has also had a dramatic effect. In a recessionary economy, where consumer confidence is low, there is an obvious reluctance to invest significant sums in second homes, particularly when property markets at home may have contracted significantly. Hence the resort and condominium market must evolve to cater for new market demands – vacation ownership, timeshare and fractional ownership are all examples of reducing the significance of the investment to encourage demand.

Similarly, the global financial crisis and tightening of credit guidelines has led to the failure or stalling of many resort projects under construction and has prevented many others from starting construction. With lenders focusing more on cash flow and debt service rather than real estate security, and a reluctance to finance projects relying on real estate sales, the days of the condominium resort appear numbered. Success would appear to lie in the effective operation of a property as a hotel first and a real estate ownership product second. Whilst hotel rates (ADR’s) and turnovers declined significantly in 2009, occupancies are now bouncing back and tourism arrivals typically on the rise. Thus the profitability of hotel operations should continue to improve and provide development opportunities in refurbishment of existing prime hotel stock or new resort development concepts. With the lack of support from financial institutions, private equity investors are finding themselves with liquidity in a buyers market and able to choose from a considerable array of distressed or defaulting properties. Those projects that demonstrate strength of design, revenue generating potential and value for money are attracting interest from investors who recognize the evolution in the resort market. With the return of the tourists and increasing investment confidence from some of the less traditional sources, now may be the time for visionary developers to find new ways of packaging the traditionally idyllic Caribbean assets of sun, sea and sand.

Sanjay Amin FRICS ACIArb is a Director of BCQS International, a property and construction development consultancy firm that provides Valuation, Quantity Surveying and Project Management to individuals, financial, commercial, and governmental clients. He is a Fellow of the Royal Institution of Chartered Surveyors (RICS), an organization with over 140,000 members representing property interests worldwide, as well as an Associate of the Chartered Institute of Arbitrators. He is also the Chairman of the RICS Caribbean Board. You can contact him at samin@bcqs.com or for more details on BCQS, view the website at www.bcqs.com 110

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Caribbean sports tourism in focus Irish cricketer Neil Russell has been a regular visitor to the Caribbean over the past decade and he gives his views on cricket’s place within the region’s sports tourism industry. You have toured all over the world with cricket teams. Where does the Caribbean sit in your best experiences? Without doubt, it is Number One! I first toured Barbados in 1998, when I was Captain of our school team at Royal Belfast Academical Institution in Northern Ireland, and we were invited to participate in the Sir Garfield Sobers International Schools Tournament. It was the best four weeks of my life and from that point onwards, I have been hooked on Caribbean culture and its unique way of life. Since that initial trip, I have visited Barbados seven times, and also toured St Lucia and Antigua, plus I had a two weeks holiday in Jamaica. What is the big appeal of the region for overseas cricketers? For me, it’s the unique way of life. Nothing is ever done instantly in the Caribbean, and when we are so used to doing things at 100mph in our daily lives here in the UK, we find it

refreshing to enjoy things being done at an easy pace. The nightlife can be great too, and overall it’s a safe place to venture out for the tourist. Sports tourism is big business in the modern world. Did you feel people in Caribbean tourism and travel appreciated your business? We have always been looked after well so overall the answer would be yes and this includes family holidays as well. Maybe the Irish charm helps us in that regard! However, much of the initiative has come from our end and we have used existing contacts in the region to help us. Caribbean Tourism Boards could do more to market and promote in the UK, as there is a huge market in clubs and schools. As a tour organizer what is good and what is bad trying to set up a cricket tour to the Caribbean? We have been very fortunate regarding tours to the Caribbean because we have superb contacts in the region, one of whom was a

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former cricketer in Northern Ireland. We also have Barbadian Henderson Wallace, who was a fantastic fast bowling professional in Ireland during the 1980s and who has great contacts throughout the region. When we toured Antigua we used former West Indian captain and current manager Richie Richardson’s company and that worked well because we played at the two test grounds. Overall our contacts have enabled us to get good fixtures against good clubs and meet some amazing people through sport. On the flipside, it may be difficult for new tourists to find these contacts so perhaps Tourist Boards need to offer more assistance to get them. The only negative we found frustrating was the time that it takes to get definite commitments for a tour fixture list. Tours are organized over a year in advance and few Caribbean clubs look that far ahead! Of course, we now understand the Caribbean way of life and put our trust in our contacts, but it can be frustrating trying to explain that to young

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enthusiastic cricketers looking forward to their first tour. What more could be done to get cricket tours to the islands? A good question. Obviously times are tough at present, but tourism is such a huge part of the Caribbean economies it still needs to be aggressively promoted, as there are so many options for sporting tours. A few years ago the Barbados Tourist Board sponsored a Six-a-Side Tournament in Belfast through their Irish Representative Nan Short and offered the best prize in Irish Cricket to the winnersan all-expenses paid week to

sunny Barbados! Unfortunate bad weather in Ireland sometimes messed up the tournament schedule, and some clubs found it difficult to field teams because of re-arranged league matches, but the concept was very good and it received a lot of publicity. If I was working in the Caribbean sports tourism industry I would be liaising with Cricket Ireland, our governing body and perhaps arranging a national Twenty20 tournament for provincial teams with similar prizes. Also, a good relationship might involve winter training for the national team similar to what they did in Jamaica a few years ago. I understand some of the

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counties already do this. If the tournament was properly organized it could be on a closed day to get good spectator support and possibly sponsorship from Caribbean businesses. I also believe using cricket personalities both for promotion and when clubs are in the region is good PR and largely underused. Would you consider touring in the lesser-known cricket islands like St. Vincent, St Kitts or Nevis? Absolutely! It was a hotly debated topic among our last touring management team before we

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finalized the 2011 Caribbean Tour arrangements. We decided on Antigua and Barbados, but we were very keen to try one of the smaller islands too. Perhaps one

and goats grazing on the outfield, as we witnessed in one match! I’ll not name the island! The one thing that was superb on our most recent tour was the friendly

suppose there’s an element of pure jealousy on my part that I can’t lead that life 365 days a year!! The people are always helpful, courteous and smiling.

banter that existed between the two teams both on and off the field. This made the tour and ensured we had an absolute blast. Great fun and the way sport should always be!

The weather is always top drawer, the beaches are sublime and the cricket and nightlife are second to none. If anyone from the a Caribbean Tourist Board wants to offer me a job living out there, please get in touch, ASAP!! My advice is to enjoy your cricket tour to the Caribbean, and if you are a first timer, it will NOT be your last trip. If like me you have been many times before, then clearly the same “Caribbean Bug” has bitten you as when I first toured Barbados in 1998.

Sublime being the 3W’s Oval in Barbados, Beausejour Stadium in St Lucia, Sir Vivian Richards Stadium and the Queen’s Park Oval, in Antigua. The ridiculous being, playing on a field as hard as a road with barely any grass and goats grazing on the outfield, as we witnessed in one match! for the future, but even with our contacts, it is still challenging to arrange. One thing we would expect is that the smaller islands provide excellent nightlife as well as cricketing competition as touring teams are out to enjoy themselves and spend a few dollars in the process! Play hard and party hard has been our touring culture over the years. Do you feel local sporting and tourism people make the most of their cricket facilities to attract overseas tours? The short answer is no. In our experience the grounds and amenities have ranged from the sublime to the ridiculous. Sublime being the 3W’s Oval in Barbados, Beausejour Stadium in St Lucia, Sir Vivian Richards Stadium and the Queen’s Park Oval, in Antigua. The ridiculous being, playing on a field as hard as a road with barely any grass

What will bring you and your fellow cricketers back to the Caribbean? It is such a passionate cricket destination the sporting element will never change, but for many of us it is the relaxed, easy paced lifestyle. Everybody “limes” and I

Neil Russell is a leading senior cricketer with one of the top clubs in Ireland and one of the driving forces in the Grasshoppers Club, a nomadic club of Irish cricketers that has toured the world in the past 30 years. He is a busy Sales Executive in the pharmaceutical industry and makes the most of his holidays and especially cricket tours. Neil can be contacted by email at neilrussell_2000@yahoo.com 114

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Virgin leads the way Virgin Atlantic has been a good friend to Caribbean business and continues to lead the way in aviation commerce. Who better to answer key questions on the current situation than Regional Manager Nick Parker? Virgin Atlantic is a household name in global travel and has made a huge contribution to the Caribbean tourism industry. Is Virgin currently expanding or contracting in the region? We will be slightly increasing our seat capacity into the region as a result of an exciting product upgrade that we are doing to our Gatwick fleet, part of which is increasing our Premium Economy cabin capacity. We are currently planning to maintain our existing schedules into the Eastern Caribbean, although we do add extra flights during the winter season. We read a lot about fewer people travelling and the impact of UK taxes on long haul flights. What has been your experience in relation to the Caribbean? The UK taxes are clearly having a negative impact on demand and restricting growth in passengers between the UK and the Caribbean. While Virgin Atlantic continues to lobby hard against the UK taxes it is highly regrettable that many of the Caribbean

governments undermine their own lobbying credibility by increasing their own aviation taxes which makes it harder for the Caribbean market to compete against other tourism and business destinations in the global market. What are the main challenges in your industry in modern times? Without doubt the biggest challenge is the ever-increasing cost of fuel, which obviously has a huge impact on our cost base and bottom line. There is also a constant focus on efficiency to ensure we can shield the customer from as much of the rising cost as possible. Consumer confidence is a key driver in the aviation industry, which has obviously been greatly affected by the downturn in global economy over the last few years. What changes do you foresee in the future relating to air travel? Are prices going up or down? Is pricing going to be determined by seat locations, individual size or the amount of luggage being carried? The exciting thing about aviation is the speed of change. While I donâ&#x20AC;&#x2122;t

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see the total cost to the consumer reducing due to high fuel and infrastructure costs, combined with increasing government aviation taxes, I do expect the customer experience to keep getting better, particularly given improvements in technology. We continue to invest heavily in the customer experience with new fuel-efficient aircraft such as the A330 and B787 joining our fleet and innovative next generation inflight entertainment systems and seating is being added to our existing fleet to take our service to a new level. Customers are already able to buy extra legroom seats and additional baggage allowances, so in years to come I would expect this trend to continue across the industry with customers able to buy enhancements to personalise their travel experience in the areas that are important to them. On-line check-in and fast bag drop is already starting to eliminate queues at the airport Redjet has introduced a cut-price culture into regional travel. Is this something that might happen in the long haul sector?

Virgin has to work with interisland carriers, as it doesn’t fly everywhere. Does this work effectively and if not, what can be done to improve it. The main issue that restricts connectivity is the lack of proper, intergraded transfer facilities at many of the Caribbean airports for passengers and their baggage. For example, why should passengers have to clear immigration, collect their bags, clear customs and then go through the check-in process again? This is hugely inefficient and adds considerable time to the

We are very proud that we are one of the few international airlines that offer a full service regional office as well as our own staff at the airports. Many flights to and from the Caribbean are full, but at some times the number of passengers is quite sparse. Obviously this is known from afar so why does the airline not offer massive discounts at short notice to fill the seats? It would be easy to offer massive discounts, however before doing so we have to always evaluate if the discounted rate actually increases the number of bookings over the course of the year or just changes the dates when people choose to

fly. Aviation is a very slim margin industry so we have to be careful to protect the profitability of routes. Additionally, when you look at the fares we charge, you’ll see that they are competitive, however an excessive and disproportionate amount of the ticket costs are made up of government taxes over which we have no control. Are there any improvements that could be made in the Caribbean to improve the efficiency of Virgin’s service? We are very proud that we are one of the few international airlines that offer a full service regional office as well as our own staff at the airports. Last year we invested heavily in staff training across the region and we will continue this programme to ensure that the customer experience is at the heart of everything we do. In addition to this we will are also investing in new technology for our Regional Contact Centre, which will deliver a better experience for our customers as well as improving efficiency.

Nick Parker is the Caribbean Regional Manager for Virgin Atlantic, responsible for all operational, commercial and sales activity in the region from Cuba to Tobago. Nick has been with Virgin since 1999 and has held a variety of commercial, operational and sales roles during that time. Nick can be contacted at Virgin Atlantic's Caribbean regional office based in Hastings, Barbados, on +1 246 228 4915. 117

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passengers’ journey. The introduction of intergraded transfer facilities would improve the customer experience and strengthen certain destinations as a regional hub, encouraging growth.

c a r i b b e a n

The low cost model works well in the short haul/regional market but there are several challenges that prevent the model being replicated to the same degree in the long haul market. Customers need and demand a different level of service on an 8-hour flight compared to a 2-hour journey and we strive to give our customers a differentiated, better experience than our competitors. Generally speaking when there is competition on routes fares have to be competitive.

m a g a z i n e

Business

How to build economically in the Caribbean. Quantity Surveyor Robert Hoyle of Rider Levett Bucknall outlines basic strategies that could save developers and homebuilders a fortune on their building project. The Caribbean shares similarities with other construction markets and has inherited practices from North America, Europe and elsewhere, but it is a unique market in its own right. Within the Caribbean, there are additional sub-markets, which have their own particular influences and procedures; recognizing this is fundamental to the success of any building scheme in the region. Despite these complexities, there is still one rule that remains critical for successful development in the Caribbean or anywhere in the world and that is to set up properly in the first place. The old adage that â&#x20AC;&#x153;prevention is better than cureâ&#x20AC;? has never been more applicable. A sound procurement strategy is key to achieving an economical outcome and this is relevant whether you are developing a single-family dwelling or a resort. While the procedures in the Caribbean may vary and will have to be adapted to suit the economics of the particular scheme, the principles of sound procurement practice remain the same.

Set a budget

Consider refurbishments

Have a budget professionally prepared. If you do not have an accurate assessment of cost, the cost cannot be managed.

Particularly in the current depressed market, a properly designed and managed refurbishment can unlock value.

Appoint a professional team

Draw up an agreement for all contractual relationshipsThis is not expensive or difficult, but it clearly sets out what is agreed between the parties and for how much. The most important of these is the agreement between Employer and Contractor. Again there are standard agreements for all manner of procurement strategies and the correct selection, correct drafting and subsequent administration of the contract is vital to success.

The myth that this is an unnecessary expense is generally unfounded. A good professional team will generally save you money by avoiding common pitfalls and properly managing the Contractor. Manage risks Identify the risks and leave them with the person most able to manage and control that risk. For example, usually you should not directly employ subcontractors. Managing subcontractors is a different skill set and one which main contractors are adept at doing. Constrain your contractor to a program and penalties for late completion and leave the site management up to him.

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Tender not negotiate If you wish to use a particular contractor through track record, experience, existing relationship or where there are not many options, this is fine. But, if you are not so constrained, tender the works. Especially in the current market, there is no better way of achieving value.

Business

Pick appropriate contractors Always properly pre-qualify contractors to establish they have the capacity and experience to undertake your scheme. An overextended contractor without the relevant expertise will more often than not lead to trouble. Don't make changes Decide what you want, have it designed, tendered and then built. Limit any changes post contract. If you canâ&#x20AC;&#x2122;t do this, summarize the changes and make proper provision for them in the contract. Tailor the design to suit the local market and expertise

but unlikely to be on the smaller islands in all but the largest of schemes. Donâ&#x20AC;&#x2122;t start too early Starting early without a substantially completed design will often lead to additional cost and late completion rather than the intended outcome of early completion.

Particularly on larger schemes, performance bonds are essential. They are not overly expensive and insure against the contractor defaulting. Include a Performance Bond

Avoid stage payments Stage payments are often arbitrary assessments of value and generally lead to Contractors being overpaid. It is a simple exercise to pay a contractor regularly for the work he has done and it is fairer to both parties to do this.

For example precast or modular structures are fine in Barbados,

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Particularly on larger schemes, performance bonds are essential. They are not overly expensive and insure against the contractor defaulting. However, make sure the provisions of the bond are professionally vetted. You donâ&#x20AC;&#x2122;t want to pay for a bond that you may never be able to call.

Business

Consider local suppliers There are some very good manufacturers within Caricom, which are cheaper than imported duty payable alternatives. Seek Concessions Governments will award concessions for qualifying schemes, which can result in some significant savings on

import duty, VAT and other taxes. Of course, the majority of the above assumes a scheme where program is not the biggest driving force and that is often not the case. But, even when program is the driving force, the fundamentals still apply and have to be adapted for an accelerated start. I have seen many examples where projects have failed or

incurred phenomenal additional expense because some of the basic rules of procurement have not been followed. Employ professionals, select the correct procurement route, properly document and tender everything and apportion risk. You will mitigate your exposure and significantly increase the likelihood of your project being completed on time and on budget.

Robert Hoyle is Chartered Quantity Surveyor with over 20 years experience and is the Prinicipal of the Barbados office of Rider Levett Bucknall. RLB is a global property and construction practice with over 2,500 people in more than 120 offices across Asia, Oceania, Europe, Middle East, Africa and the Americas. Services provided include Cost Management, Project Management, Quantity Surveying and Advisory Services. Rider Levett Bucknall publishes a quarterly Caribbean Construction Cost Commentary which is available on their website at www.rlb.com. 120