St. Clair pacts with China’s Yingke Travel to promote time-sharing in P.R.
Three weeks ago, the St. Clair Collection signed an agreement with Yingke Travel — which has the largest network of travel agencies in China — to promote its time-share properties in Puerto Rico, company Founder Keith St. Clair confirmed in an exclusive interview.
“I think it will prove to be the largest individual tourism contract between Puerto Rico and China. We signed with Yingke Travel, which has 6,000 travel agencies going up to 10,000 for their business to promote our time-share products in China,” St. Clair said.
“We feel very sure that we’ll be seeing thousands of Chinese travelers next year and in years to come, and that sometime next year we’ll start a weekly flight from Beijing and Shanghai to Puerto Rico,” St. Clair predicted, saying talks are already happening with Chinese airlines.
The St. Clair Collection forged the relationship to work with Yingke Travel through its local office, Yingke Caribbean. Yingke is China’s largest law firm with 8,000 attorneys on staff worldwide, and parent to several business divisions.
Through the agreement, the St. Clair Collection will provide the product and Yingke will do the training and distribution within their network in China, St. Clair said.
The promotional efforts will encompass all of St. Clair Collection’s current and future properties in Puerto Rico — seven in total — including Mare, Jade and Noir in Isla Verde, Safiro in Vieques, a planned mountain resort in Cayey, a 300-room hotel planned for the Miramar Convention Center District, and a seventh property in the pipeline.
As part of the pact, St. Clair Collection will have offices in Beijing and Shanghai in the same buildings where Yingke’s offices are, he said.
“Yingke Caribbean has been working for two years in building a cultural and business relationship between Puerto Rico and China. The St. Clair Collection is a perfect way for Yingke Caribbean to build the Puerto Rican relationship with Yingke China,” he said.
The time-share business in Puerto Rico has been under the radar, and is outpaced by other countries in the region, such as the Dominican Republic and Cancún, where 45 percent of the 20 million or 30 million that visit that Mexican resort town are time-share clients.
“Time-share clients are the most amazing, fertile clients for a tourism economy because they invest by buying for the long-term,” St. Clair said. “All of these projects being built are time-share, so when the Jade opens in two months, there will be another 7,500 time-share weeks to sell there, which is $120 million in inventory.”
“You have the opportunity for the Chinese influx to be very significant. Part of our business philosophy here is to reinvest everything that we make, so we’re reinvesting and as the China business helps to empower the tourism economy here, we will take that and build more properties,” St. Clair said. “We’re taking the money from the Chinese relationship, and we’ll be investing it in more properties in Puerto Rico.”
The seven projects St. Clair Collection is developing will have about $484 million worth of time share opportunities, which the company is planning to sell over 10 years.
“It’s an easy sales task. Over those 10 years I would think we should be looking at somewhere between 5,000 and 10,000 time-share owners from China, which is significant,” St. Clair said.
Meanwhile, Jeff Carmichael, CEO of the Yingke Caribbean China Center in San Juan, said since the office opened two years ago, it has “been working diligently to establish relationships and do a lot of cultural education about Chinese business practices, and cultural similarities and differences and bridging those gaps.”
As a result, there has been an influx of Chinese investors buying land and properties in Puerto Rico.
In addition, about three weeks ago, Yingke held an “Invest in Puerto Rico” summit in Shanghai, attended by 300 investment and real estate groups and the Chinese media that was covering the event “was publishing that Puerto Rico was the best place for investment in the Americas and that the Chinese should look here for investment opportunities,” Carmichael said.
“The way a lot of relationships begin is with travel, and that’s tourism. Yingke Tours is the largest privately-owned tour agency in China, with more than 20,000 employees and it’s becoming the largest presence to represent more than 180 million Chinese residents that travel outside of China each year,” he said.
Buying time-shares is becoming a growing trend in China, he said.
“Over the past five to 10 years, the Chinese middle-class has grown dramatically. Now, some 300 million people now have money to travel. They may come to Puerto Rico or they may go to other places,” Carmichael said, adding the time-share program will be promoted in China as the Yingke Vacation Club, powered by the St. Clair Collection.
Puerto Rico is an ideal destination for Chinese investors because it is essentially sheltered from the trade war between the U.S. and that country that has been unleashed by the Trump administration.
That is because Puerto Rico has a different tax system that is separate from what applies in the U.S. mainland, making it attractive.
Yingke plans to build a Chinese cultural park in Puerto Rico, which has already been designed. The groundbreaking should be in the next six to nine months, and the first phase of that will be a $250 million investment, Carmichael said.
The project, whose location was undisclosed, is expected to create 2,000 jobs and “serve as an ongoing representation of all of the provinces of China to promote culture. The plan is to cross-promote Puerto Rico culture and Chinese culture.”