Luxury tourism industry execs: Puerto Rico has potential to compete globally
Puerto Rico has the potential to compete with other global destinations when it comes to luxury tourism, but private sector companies must work together – and the government must do its part – to make that a reality, two local industry players stated at the recent Puerto Rico ICON Conference.
During the panel “Double Down on Puerto Rico, Playing the Long Game,” moderated by Ricky Santana, co-founder of the Puerto Rico ICON Institute; Rolando Padua, president of Paulson Puerto Rico; and Federico Stubbe Jr., chief executive officer of PRISA Group, discussed the impact of market changes on new luxury projects, efforts to adapt to evolving resale markets and sustainable development practices.
In his presentation, Stubbe emphasized the potential Puerto Rico has to compete with other markets. He explained that the island’s diverse offerings give it a competitive advantage over other markets such as Miami.
“We understand that there are many challenges, but as businessmen, we cannot allow particular interests to stagnate the development of Puerto Rico; we must dare to think and act with courage and determination for the benefit of future generations,” he said.
“An example of this is the high-quality, large-scale coastal developments, which have become a very important engine of tourist and residential development for Puerto Rico. A positive attitude toward them must permeate, including on the part of the Government of Puerto Rico,” he added.
For his part, Padua pointed out Puerto Rico’s potential to stand out globally in different areas, such as luxury tourism, and the importance of supporting and maximizing available resources.
He noted that projects such as Vanderbilt Residences and Ocean Drive are aimed at addressing the shortage of hotel rooms necessary to make the island competitive internationally.
“The development of condo hotels on the island places us at the forefront of other markets and creates added value in the tourism industry,” Padua said. “To promote diverse economic development, which addresses diverse needs, our company has invested in a diverse portfolio ranging from hotels, real estate and commercial offices to the automotive industry.”
Nearly 200 attendees participated in the two-day event, including entrepreneurs and business leaders. The event provided a platform for sharing ideas, experiences and strategies related to Puerto Rico’s unique business landscape, along with the challenges and opportunities that the market faces.
In their presentations, both Padua and Stubbe emphasized the importance of two local companies that should not be seen as competitors but should present a united front, working for Puerto Rico’s future.
“We’re always adjusting as the market changes. Since 2012, we have had great achievements in adapting in developments, real estate sales and diversification. John Paulson has led significant hotel transactions that totaled $1.5 billion in Arizona, Hawaii and California; $150 million in Miami; and $1.25 billion in Orlando and Phoenix, to provide a few examples,” said Padua.
“In Puerto Rico, our business principle is always to reinvest profits in the island. This way, we create an ecosystem of sustainable economic development and job creation, which allows us to plan our long-term investments,” he added.
Stubbe discussed the market opportunities and how PRISA Group has found niche projects. Among them are the creation of Dorado Health in the health care area; regional tourism with Fairfield by Marriott Luquillo Beach & El Tropical Casino; entertainment and commerce with Distrito T-Mobile; and the Popular Campus office project.
“The projects are aimed at attracting more foreign investment to Puerto Rico through the creation of world-class communities and destinations. This effort is generating thousands of jobs that contribute to a better quality of life for numerous Puerto Rican families,” he said.
However, the executive noted that the industry faces certain obstacles.
“One of the main challenges is the complex permitting process in Puerto Rico, which continues to stall and delay much of the important work that must be done to advance our infrastructure. This includes the limitation of developable areas,” he said.
“There is a shortage of affordable housing here in part because the [government is] limiting development in green areas. And for small and medium enterprises, the process is almost impossible, and without strong SMEs, Puerto Rico won’t move forward,” Stubbe said.
The developer assured that Puerto Rico “has the potential to compete favorably with other tourist destinations, and it is our responsibility to take the step forward, establish alliances, use the necessary technology and resources to achieve the Puerto Rico we long for.”
“We, the entrepreneurs of Puerto Rico, must present a united front, as our competition is with foreign markets. Global competition is necessary to make Puerto Rico better, but internally, we have to work together,” Stubbe emphasized.
He also highlighted the need to welcome competition and for the government to communicate and educate residents about the benefits Act 60 participants provide to nonprofit and community-based organizations.
“The government has to be part of that education, even if the private sector leads the effort,” he concluded.
