Developer St. Clair restarts projects after COVID-19 hiatus
British entrepreneur Keith St. Clair is restarting five development projects he has had on hold since March 2020 due to the year-long COVID-19 hiatus, which he said brought on $30 million in revenue losses.
In an interview with this media outlet, the developer, who arrived in Puerto Rico six years ago, said despite the back-to-back challenges, he’s pressing on.
St. Clair has projects planned in San Juan, Carolina, Cayey and Vieques – several of which have been scaled back in response to the pandemic.
In Carolina, St. Clair confirmed the reopening of the Mare hotel, which operates inside the ESJ Tower building in Isla Verde, in April. The property has both regular hotel rooms and time-share units. That hotel has been closed since the government took steps last year to restrict certain activities to curb the spread of COVID-19.
The pandemic brought with it a slowdown in travel and tourism, which affected both sectors across-the-board.
Another property in Isla Verde, adjacent to ESJ, is the Jade hotel, which was slated to open during the first quarter of 2019 but will now be ready in about six months. That property will entail a $40 investment and will add 112 rooms to the area, a rooftop pool and other amenities throughout its nine floors. Its reopening will require an additional $3 million to $4 million, St. Clair said.
Another project set to restart construction in Isla Verde is the 17-story Noir hotel. That property will represent an overhaul of the former Empress Hotel and four adjacent homes that St. Clair bought and had rezoned. The property will have 110 rooms. It had an initial price tag of $60 million.
The project has been halted, as have the others, for the past year, requiring St. Clair to sit down to renegotiate payment terms and moratoriums with all of its lenders — Oriental, Parliament, FirstBank, Crescent, and Popular.
“When COVID hit, we talked with all of the lenders and reached a moratorium agreement and a payment plan with all of them,” he said, noting that the Noir project is about 18 months behind schedule, due to the pandemic.
But in September 2020, FirstBank sent a letter of default to collect on a loan of more than $3.8 million to finance Noir, which was followed by a lawsuit last month, as this media outlet reported. St. Clair said a settlement has been reached and the bank is moving to dismiss the claim this week.
“It was a surprise and we dealt with it appropriately,” he said.
The Noir hotel is now in the pre-construction development phase and should be completed in 24 to 30 months. The property will now include an extended deck and an additional floor, after securing permits from the Department of Natural and Environmental Resources and the Federal Aviation Administration, he said.
Outside metropolitan area, St. Clair confirmed the projects announced in Cayey and Vieques are still planned but have been scaled-back in size and concept.
The Zafira hotel project in Vieques, which in 2019 had an initial $50 million associated investment that entailed building an 118-room boutique hotel with an an infinity pool, restaurant, spa, disco and suites and villas. Now, that investment has been reduced to $21 million.
“We’ve reassessed the project and what we’re going to do is put a small glamping operation there, starting with 10 tents and a $750,000 investment. We’re going to relook at the opportunity, reworking the original design of the hotel to make it more eco-friendly,” he said of the property in the island municipality’s Esperanza sector.
In Cayey, the company has purchased just over 30 acres of land to develop what is currently known as the Lodges at Cayey, but which he said will likely be re-branded as “Verde.” St. Clair also recently purchased the iconic The Sand and The Sea restaurant, which sustained damages from Hurricane María in late 2017, but remains in operations.
Initially, the project called for building 100, one-, two-, and three- bedroom villas, 14 residential units, a hotel, a restaurant and a spa at a cost of $40 million. Now, the project will be developed into a trimmed down “glamping” site with eco-friendly facilities, similar to the project proposed for Vieques. The Sand and The Sea will also be relocated, he said.
Back in the San Juan metropolitan area, St. Clair said the company entered into a contract extension with the Convention Center District Authority in Miramar, to move ahead with the construction of the $65 million Film District complex.
“Phase one was the demolition of 17 of 18 buildings in the Old Naval Base. We’ve remediated the lead and asbestos on the property, which has been transferred off-island. The site is ready and the agreement with the District Authority is that we’ll break ground on the project by the end of June,” he said.
All told, the projects are expected to generate about 2,700 jobs in predevelopment, construction and after opening, he said.