Friday, March 24, 2006

caribbean is hot as 2nd home market

Caribbean is hot as 2nd-home market
Lesser-known and more remote islands draw development boom

By June Fletcher
The Wall Street Journal


In a bid to feed the growing appetite for second homes among U.S. residents, a number of major developers are building luxury projects on far-flung Caribbean islands.
Americans have been buying vacation or retirement places for years on well-known Caribbean islands like St. Thomas, Barbados and St. Croix. But the latest wave of building involves real estate that doesn't register on most people's radar -- islands with names like Great Exuma, Roatan and Scrub -- and is geared toward everyone from small-time investors looking for bargains to wealthy executives seeking tax havens.
The new waterfront developments include big players like Marriott International's Ritz-Carlton, Four Seasons Hotels and Starwood Hotels & Resorts Worldwide's St. Regis Hotels and Resorts. With Swiss/Italian partners, New York developer Donald Trump is building Trump Island Villas on the five-square-mile island of Canouan.
At least 30 resorts with some residential component are planned or under construction throughout the Caribbean, double the number of two years ago, says Scott Berman, a partner specializing in the hospitality industry at PricewaterhouseCoopers in Miami.
Although island chains closest to the U.S., like the Bahamas and Puerto Rico, remain popular, Geoffrey Pidduck, an Antigua real-estate broker, has seen home prices as much as quadruple in the past two years on the lesser-known and more remote Caribbean islands. "It's been a feeding frenzy," he says.
The development boom is part of a broader movement of Americans buying homes overseas in pursuit of better climate, cheaper cost of living, tax breaks or other incentives another country may offer. Some are simply looking for lower-cost waterfront housing without having to compromise certain standards. A growing scarcity of prime waterfront property on better-known islands is causing builders to turn to more isolated places.
While a bare-bones condominium in a place like the Dominican Republic can sell for as little as $40,000, prices in the higher-end resorts are much more expensive.
Offering everything from nanny service to massages to private chefs, the packed-with-amenities developments can rival the cost of oceanfront resort developments stateside. They range from $325,000 for one-bedroom apartments at NonSuch Bay, an Antiguan resort being built by the Dutch development group La Perla International Living, to $7 million for ultra-contemporary four-bedroom villas at Viceroy Resort and Residences on Anguilla, built by the Kor Hotel Group.
To attract buyers who can afford to pay these prices, but don't want the hassle of importing furniture, developers often sweeten the deal by offering furnishings.
Not all of the developments are being done by famous resort chains, though these, of course, tend to be more modest. Windward Development Group, based in St. Georges, Grenada, is building 40 villas ranging from $500,000 to $1 million on Carriacou, a 13-square-mile island that's about 5 miles south of Canouan. Opening at the end of this year, the project will encompass a 20-unit hotel with spa services, a restaurant and a mini-putting range.


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