Nearly two decades after it was first unveiled with massive enthusiasm — only to be held up by a protracted legal battle that basically left it in shambles — the Cayo Largo hotel development project is finally expected to move forward in Fajardo starting next year, for an opening in 2017, this media outlet learned.
Holding company Resort at Cayo Largo, headed by veteran hotelier Rick Newman, plans to break ground on a 150-room luxury boutique hotel on a 640-acre stretch of land located on Puerto Rico’s eastern end in coming months, he confirmed.
Resort at Cayo Largo represents Flagship Services Corporation, which purchased the property with partner DLJ Real Estate Capital six years ago. Flagship Services also owns the Verdanza Hotel in Isla Verde, as well as other hotel and resort properties in the Caribbean region.
“We hope something will happen there in 2014. Our group bought it in 2007 and we’re currently working on all the logistics and permits,” said Newman. “We’ve already demolished what was there.”
What was there was an almost completed 314-room structure that featured typical resort amenities such as restaurants, pools, a casino and a spa and golf course. That structure entailed a $195 million investment in 2001 by the original owners, a group that included former Puerto del Rey Inc. President Dan Shelley, Fuentes Construction Co., V. Suarez & Co. CEO Diego Suarez Jr., and executive Manuel H. Dubon.
Their plans called for building the posh property and branding it a Four Seasons Resort. However, permitting and environmental concerns plagued the project, which got tangled up in courts for several years. It remains uncertain whether the new hotel will fly that flag once it opens.
Following what Newman called a “more modern thought process,” the proposed project will pursue the upscale luxury traveler market, in line with what has already been accomplished by the St. Regis Bahía Beach in Río Grande and the Dorado Beach Ritz Carlton in Dorado, he said.
“We want to contribute to Puerto Rico’s growth and presence in that luxury market, by supporting what’s already here,” he said. “We have a tremendous amount of support and the other hotels have shown that they can support that market.”
Although the investment for the re-booted Cayo Largo project has not been calculated yet, Newman confirmed that the developers do not foresee dipping into the government’s Tourism Development Fund to move it forward.
“The government is involved, as the Tourism Co., the Economic Development and Commerce Department and the Government Development Bank are all behind it, helping in the areas of permitting and development issues, but we don’t see taking from the TDF for now,” Newman said.