Provenance Properties Special Market Report

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Special Market Report

MEMBER OF CIREBA

The Residences at Seafire


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Contents

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Broker welcome

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Christie’s International Real Estate

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Market performance

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Notable sales

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The Residences at Seafire

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Why Cayman?

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OLEA at Camana Bay

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Cayman Islands properties for sale

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The Peninsula Estate

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Provenance Properties in the community

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Seven tips for listing your property

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Five things to know when purchasing property in the Cayman Islands

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I’ve written a number of “years in review” in my career, but never for a year like 2020. As I reflect on how 2020 started, progressed and ended in the Cayman Islands, I am so proud of how our country and our brokerage performed. Last January, we were welcoming a record number of tourists to Grand Cayman and enquiries from those seeking to relocate to Cayman or acquire a vacation home here were brisk. A month later, we proudly accepted an Affiliate of the Year award at the Christie’s International Real Estate Owners Conference in Palm Beach. Spirits were high and we were confident that our performance would only continue to grow. Yet, just 30 days later, the borders to our country closed and remain closed today (although they are anticipated to reopen following a robust vaccination programme rollout). Pundits quickly proclaimed a significant downturn in real estate sales, with some forecasting a spurt of distressed sales and the end of commercial real estate — but this didn’t happen.

Jackie Doak

In fact, we defied the odds. Through the strong leadership of our government and the strength of our community, we came together to not only survive the initial impact of shelter-in-place guidelines but to emerge from that period in early summer to resume “normal life.” The news of Cayman’s success in this regard quickly caught the attention of international clients. The result? A record sales year in the history of the MLS in the Cayman Islands, and an incredible year for our brokerage. We were a leading brokerage in the number of sales over US$1 million and sold 15 condos at The Residences at Seafire. Our brokerage team embraced technology to stay connected with clients across the miles, participating in more than 35 webinars and hundreds of Zoom calls. We are now welcoming these new residents to Cayman through the Cayman Islands Government’s Global Citizen and residency-byinvestment programmes. Looking ahead to the rest of 2021, we are already experiencing active sales, and I am confident that Cayman’s value proposition will continue to attract the attention of globally mobile individuals who value our quality of life and our “Caymankind” culture. Wishing all a year of prosperity and gratitude.

Jackie Doak Broker, Provenance Properties Cayman Islands President Business Development, Dart 5


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Blending the worlds of art and real estate Christie’s 254-year-old brand has been built on trust, passionate expertise, exceptional client service, integrity and discretion. Like the other members of Christie’s global, invitation-only network of independent brokerages, Provenance Properties’ business was built on the same foundation, and its real estate specialists serve their clients just as Christie’s art and luxury goods specialists would. This is of paramount importance, in no small measure, because those clients are often one and the same and the provision of services must therefore meet Christie’s centuries-old standards.  Provenance Properties possesses a unique ability to service the world’s most discerning clients, representing buyers and sellers of exceptional Cayman Islands homes. Their global reach is achieved by utilising curated, industry-leading marketing initiatives, marketing through Christie’s global auction house and real estate office locations, and leveraging unparalleled marketing channels to communicate directly with high-net-worth individuals, including Christie’s global clientele.

Dan Conn

Dan Conn Chief Executive Officer, Christie’s International Real Estate

Curated network of Christie’s International Real Estate specialists representing: 12,000

Number of Luxury Properties Worldwide

US$45B

Value of Luxury Properties Worldwide

US$500B

Real Estate Sales Over the Last Five Years

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2020: Cayman Islands market— strength amid global volatility

Seven Mile Beach

Last year, the Cayman Islands Real Estate Brokers Association (CIREBA) reported total sales of US$638.7m generated by its 36 brokerage members, the highest in the history of the MLS. This was no small feat, given that the borders to the Cayman Islands have been closed since late March 2020 and country-wide shelter-in-place regulations were observed for more than three months in the spring.

The Residences at Seafire 8

The real estate market’s strong performance surprised some pundits but given recent global affairs and the enduring strength of the Cayman Islands’ value proposition, the results are easily explained.


Cayman Islands value proposition

Cayman’s enduring value proposition enhanced demand for real estate in 2020. As globally mobile and affluent individuals sought properties in jurisdictions for the aforementioned reasons, Cayman’s attributes provided the solutions to their needs. These included: • • • •

• • •

Global affairs

Historic low interest rates and strong stock market performance provided an optimum environment for investors who had liquidity positions to expand their real estate portfolios in 2020. Q1 sales were buoyed by these conditions. The emergence of a global pandemic in Q2 accelerated property demand in the Cayman Islands for three reasons: the desire to acquire a safe haven property in a low-density and safe locale, a greater appreciation of the value of having a back-up property in a stable jurisdiction and a retreat from the turbulent market conditions to real estate as an alternative investment.

No restrictions on foreign ownership of property No alien landholding licenses required No income, corporate, capital gains or recurring property taxes Straightforward permanent residency through real estate investment programmes Stable economy and sound governance and judiciary High standard of living and modern infrastructure Rich natural environment and welcoming culture

These factors appealed not only to international buyers but also to residents who looked to expand their investments in Cayman real estate with confidence after witnessing first-hand the benefits of property ownership in a safe and stable jurisdiction in a turbulent world.

Market insights

Whilst market performance will vary by property type, price range and neighbourhood, the following data provides some insight into the performance of Cayman’s real estate industry in 2020. Provenance Properties specialises in selling luxury waterfront properties priced at US$1m+. As such, this review highlights the performance of that market segment.

In 2020, the median days on the market for all Cayman Islands properties was 199. This includes all properties – residential, commercial and vacant land. In comparison, the median days on market for all Cayman Islands properties priced at USD $1m+ was 327. At first glance, the median days on market may appear high, particularly when demand for luxury properties is increasing. However, despite the efficiencies that were achieved in conveyancing property during the shelter-inplace period, the transaction process was slower than normal in 2020 as individuals, organisations and government adapted to working remotely. Further, the continued closure of borders adversely impacted the number of sales in the high end of the market as some international buyers were reluctant to buy property sight unseen. Other highlights related to the performance of the luxury market sector include: • • •

7% - Average variance from list to sell price of properties priced at US$1m+ 69 - Number of condos sold 57 - Number of houses sold

Assuming prevailing conditions continue in 2021, Provenance Properties is optimistic that the Cayman Islands real estate market will have another strong year. Low interest rates, continued availability of financing, strong financial stock market performance and geopolitical uncertainties will continue to prompt international buyers to seek properties in Cayman.

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Only in Grand Cayman: 2019

2020

• Total number of sales 831 • Total volume US$639.3m

• Total number of sales 700 • Total volume US$694m

Land • Total number of sales 214 • Total volume US$88m

Land • Total number of sales 211 • Total volume US$84m

Single family homes (over US$1m) • Total number of sales 52 • Total volume US$105.5m

Single family homes (over US$1m) • Total number of sales 57 • Total volume US$146m

Condos (over US$1m) • Total number of sales 65 • Total volume US$164.5m

Condos (over US$1m) • Total number of sales 69 • Total volume US$198.5m

All stats have been analysed by Provenance Properties Cayman Islands. This report is not written on behalf of CIREBA. Stats were collected from the CIREBA MLS on 16 March 2021.

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NOTABLE SALES

Residence N802 at The Residences at Seafire Sold August 2020

Residence N603 at The Residences at Seafire Sold October 2020

Residence 512 - OLEA Condominium Sold November 2020

The WaterColours #903 Sold October 2020

Crown Court #832, Britannia

Red Bay Estates

Sold October 2020

Sold August 2020 11


FEATURE

Over

Private owners’ lounge, The Nest

The Residences at Seafire, Seven Mile Beach

70%

sold out

One- to five-bedroom residences Starting at US$2.035m MLS#: 408257, 411752, 54, 412160, 836 Situated on one of the least populated stretches of Seven Mile Beach, The Residences at Seafire deliver a distinctively innovative approach to beach living with an enlivening mix of social and secluded resort experiences infused with Caymanian flavour and Kimpton spirit. Offering a turnkey solution for globally mobile individuals, The Residences at Seafire provides move-in-ready luxury residences on one of the most beautiful beaches in the world, Seven Mile Beach. Owners at The Residences at Seafire enjoy access to the rich amenities of the adjacent AAA Five Diamond Award-winning Kimpton Seafire Resort + Spa, the boutique hotel brand’s first Caribbean resort. Adding to the Seafire experience are three distinct dining venues, boundless beach activities and more. Expansive terraces and light-filled open concept living areas blur the lines between indoor and outdoor living. Some residences 12

highlight views of Seven Mile Beach and the North Sound, a rarity in Grand Cayman real estate. The Residences at Seafire pair world-class design with commanding views of the beach, the sea, and the island. Interiors are as serene as the sea itself with bright whites, cool woods and a selection of blues from the infinite palette of the Caribbean Sea. Owners enjoy access to a private rooftop terrace, The Nest — the highest point on Grand Cayman and a perfect spot for socialising with lounge areas and an outdoor kitchen with grill. The Oasis pool — a second, secluded swimming pool — is also accessible by owners. Furniture packages by Restoration Hardware are available for purchase. Owners may also wish to include their home in the optional rental programme operated by Kimpton Seafire Resort + Spa.

Offering a turnkey solution for globally mobile individuals, The Residences at Seafire provides move-in-ready luxury residences on one of the least populated stretches of Seven Mile Beach.


Kimpton Seafire Resort + Spa

Penthouse master bedroom

Oasis Pool

Three-bedroom living area

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Camana Bay

Simplicity. Safety. Sophistication. That is the essence of what attracts people to live and work in the Cayman Islands. Ranked as the easiest place to do business by The Global Complexity Index (2019), this tax-neutral British Overseas Territory has earned accolades for being a straightforward place to work, where establishing a physical presence is a simple process thanks to world-class service providers, a stable and efficient government and a highly regulated financial services industry. The Cayman Islands has also been recognised as the friendliest country in the world*, a reflection of its welcoming population long accustomed to the presence of international corporations in Grand Cayman. A low crime rate, a wellestablished judiciary and a high standard of living contribute to the safe living and business environment. This sunny archipelago is also renowned for its luxury resorts and residential 14

properties, world-class culinary scene and diverse international community, all of which contribute to a sophisticated place in which to live and work. From a new airport and extensive airlift, to modern roads, three hospitals, quality power, water and internet providers, and more, it’s no surprise that visitors and new residents alike are often delighted by the livability of Grand Cayman. Dart has made significant contributions to that sophisticated lifestyle, investing over US$1.5 billion in luxury resorts and residential properties, Class-A commercial office buildings, public infrastructure projects in partnership with government and community groups and, most notably its flagship development, Camana Bay – a 685-acre waterfront town centre founded on the principles of New Urbanism. Dart currently manages over 800,000 square feet of Class-A and Class-B office, retail and food and beverage space in Camana

Bay and other strategic locations across the Cayman Islands. Beyond the role of real estate developer, Dart is committed to the Cayman Islands. Through its investments and strategic partnerships, Dart shares a vision of growth and sustainable development for the Cayman Islands which advances its position as a premier financial services jurisdiction. The Dart business development team helps business owners and individuals learn about the benefits of living and working in the Cayman Islands, and assists with making the relocation process an efficient and positive experience. “HSBC Expat Explorer Survey, 2012”


Camana Bay Town Centre

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2019-2020

Community, lifestyle and healthy habits are enhanced by over an acre of green space at OLEA in the town of Camana Bay.

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OLEA, Camana Bay | MLS#: 409470, 411802, 412680-81, 412856-57

OLEA, Camana Bay Named for a family of trees that is perpetually fragrant, fruitful and green, the waterfront neighbourhood of OLEA is located in the town of Camana Bay and offers a central location and a masterplanned New Urbanist community. Brought to market by Dart Real Estate and NCB Group, this walkable, award-winning sustainable community features 124 residences and family-friendly amenities, such as a resort-style swimming pool, yoga green and the island’s only lazy river.

With homes ranging from one-bedroom condominiums to four-bedroom duplexes and townhomes, OLEA offers diverse floor plans to suit every taste.

Over 60% of released phases sold

8-minute walk to the Camana Bay Town Centre

Stamp duty paid on all residences until 30 June 2021

Cayman’s only lazy river

International Property Awards winner

First residents welcomed in spring 2021

Community, lifestyle and healthy habits are enhanced by over an acre of green space at OLEA. Residents will enjoy a vast array of shared amenities, including children’s playgrounds, a community herb and produce garden, a gym and more. A show home will open spring 2021.

*This is a pre-construction development. All displayed images are renderings.

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LOCAL LISTINGS

Residence N1002 at The Residences at Seafire US$7,700,000 | 5 bed | 4.5 bath | 3,883 sq. ft. | MLS#: 411752 Seven Mile Beach

Residence S1001 at The Residences at Seafire US$7,370,000 | 4 bed | 4.5 bath | 3,361 sq. ft. | MLS#: 411754 Seven Mile Beach 18


Residence 202 - OLEA Townhome US$1,824,950 | 3 bed | 3.5 bath | 3,807 sq. ft. | MLS#: 411802 Camana Bay

Residence 211 - OLEA Townhome US$1,449,950 | 3 bed | 3.5 bath | 2,660 sq. ft. | MLS#: 412681 Camana Bay 19


LOCAL LISTINGS

Water’s Edge #22 US$4,450,000 | 3 bed | 3 bath | 3,255 sq. ft. | MLS#: 410318 Seven Mile Beach

391 Bimini Drive US$3,500,000 | 5 bed | 5 bath | 6,000 sq. ft. | MLS#: 412448 Grand Harbour 20


Tamarind Bay #12 US$1,550,000 | 3 bed | 2 bath | 1,444 sq. ft. | MLS#: 412400 Seven Mile Beach

Estrella de la Mar US$3,300,000 | 4 bed | 5 bath | 7,850 sq. ft. | MLS#: 411636 Patrick’s Island 21


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FEATURED LISTING


The Peninsula Estate US$17,000,000 | 6 bed | 10 bath | 25,000 sq. ft. | MLS#: 408871

The Peninsula Estate exhibits an unparalleled level of architectural detail and innovative design.

A haven for the connoisseur who appreciates the harmonious balance of everyday living and sophisticated entertaining, this luxurious estate is situated on one of Grand Cayman’s most desirable canalfront locations, boasting 270 degrees of unobstructed waterfront views. This private compound encompasses nearly 1.75 acres within the prestigious gated community of Crystal Harbour, located in the Seven Mile Beach corridor. Featuring a private granite and marble driveway and five air-conditioned parking garages, this grand estate is one of the most exclusive listings in the Cayman Islands real estate market. This remarkable 25,000-square-foot property offers six spacious bedrooms and 10 bathrooms within its three-storeys. The Peninsula Estate exhibits an unparalleled level of architectural detail and innovative design. A 45-foot Koi pond is thoughtfully located at the entrance, inspiring feelings of wellness and serenity upon arrival.

The Peninsula Estate is home to the island’s largest residential swimming pool, complemented by two pool bars and an outdoor barbecue and entertaining area. The commercial-sized European kitchen features state-of-the-art appliances and custom stone countertops. Situated in a separate building, a 21-seat home theatre and bar operate as a perfect entertaining venue. With elegant entertaining in mind during the creative process, this estate features 21 terraces and a 700-bottle wine cellar. The landscaped marble terraces lead to a waterfront amphitheatre. A water lover’s paradise, this estate is surrounded by custom-built seawalls and a boardwalk at the water’s edge, with 500 feet of dock space. With its canalfront location, this property is a boat ride from Rum Point and Kaibo, and a few minutes’ drive from Seven Mile Beach, world-class dining and North Sound Golf Club, the only 18-hole championship golf course in the Cayman Islands. 23


Provenance Properties partners with National Gallery

Provenance Properties in the community

24 Team hosts golf day

R3 Cayman Foundation matches funds raised by Provenance Properties for ARK Cayman

From Rotaract and Toastmasters to the PTA at Cayman International School and 100 Women in Finance, the Provenance Properties team supports local initiatives, undertakes ongoing professional development and builds relationships across the globe. In 2020, Provenance Properties hosted its first-ever auction to raise funds for Acts of Random Kindness (ARK) in support of relief efforts due to COVID-19. This inaugural event raised almost US$50,000 for those in need through matching funds provided by the R3 Cayman Foundation. Due to its success, the auction will become an annual event dedicated to helping vulnerable members of the Cayman Islands community.


Seven tips for listing a property It is often said that buying a house is one of the most stressful undertakings in life. Selling a property can be as well – although it doesn’t need to be! With careful planning, a good strategy, realistic expectations and a sales specialist that meets your transactional and communication style preferences, the experience can be a seamless one. Here are some useful tips for selling your home.

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After the sale – where next?

Vendors are often focused on selling their property and do not allocate sufficient time to think about their next property acquisition. Before listing, consider your next move. Will you be able to find another property that meets your needs? Will you be satisfied with an interim solution, such as a rental?

4 Conduct a property valuation.

Your sales specialist will recommend a listing price based on market comps and general market performance. In some instances, you may also want to consider engaging a property surveyor to provide a valuation.

5 Prepare your property.

Prepare your property for the sales process. Clean cupboards and closets, freshen paint, remedy anything in need of repair and tidy landscaping. De-clutter as much as possible – the “less is more” principle prevails in this instance. It takes about 10 seconds to make a first impression – your home has to be ready to make a good one.

2 Define goals.

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3

7 It’s show time.

Identifying a desired listing price is usually the first consideration when putting up a property for sale. However, vendors should also decide on the sales price they will be willing to accept, the type of concessions to which they will agree (e.g. a quick close, owner financing), whether or not to include contents and a back-up plan should market conditions change significantly.

Engage a sales specialist.

Interview a few agents before selecting one. Ask about their professional network of contacts, their brokerage’s marketing resources, and how they will communicate with you. Understand if they work part time or full time in sales and if they focus on niche geographic markets, certain demographics or specific property types.

Create a marketing plan.

Once the property valuation is completed and a list price has been established, a marketing plan is developed. Discuss requirements for staging for photography and video tours, social media campaigns, paid ads, and open houses. Have original house plans, property surveys, utility bills and more readily available to assist the sales specialist with representing your home with all necessary information.

The vendor should ensure the property shows to its best advantage at all times. Keep your home tidy inside and out to be ready for short-notice showings. Keep your sales specialist up to date with information relevant relevant to potential buyers, such as home improvements, changes to strata fees, new properties that you hear are going to soon be listed for sale in your neighbourhood and more. 25


Five things to know when purchasing property in the Cayman Islands

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Ask anyone how long they have lived in the Cayman Islands and you will often hear a similar reply: “I initially came here to work for a year…that was 20 years ago.”

before Cayman is a place they want to call home, whether it be for vacations, a base for a globally mobile lifestyle or a permanent fulltime residence.

Tourists are equally inclined to start imagining living in the Cayman Islands soon after they arrive. It’s common to see visitors asking hotel concierges on their third or fourth day of vacation to introduce a realtor or provide information on properties for sale. The Islands have a way of capturing people’s hearts, and one trip is all it takes

Acquiring a property abroad can be a daunting exercise, even for experienced international property investors. Fortunately, property conveyancing in Cayman is a straightforward process thanks to expert professional service providers in legal, financial and real estate professions.


Here are five questions often asked by first-time buyers.

1

Are there any restrictions on overseas persons owning and renting residential real estate in the Cayman Islands?

There are generally no restrictions on foreign ownership of property, and alien landholding licenses are not required. In addition, there is no requirement to develop lands within a specified period of time. For investment-motivated purchasers there may be certain local licenses needed to rent a property. It is recommended to get professional advice prior to acquiring the property so that licensing can be considered in the overall investment decision.

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Is title insurance required?

The Cayman Islands operates under the Torrens system of land registration. The registry records all title records and the details of all land ownership information in the Cayman Islands, together with a Registry Map which indicates the boundaries of each individually owned parcel of land. There is a “statutory guarantee” of title whereby the Government of the Cayman Islands will pay compensation to any person who suffers a loss due to an error in the Land Register which cannot be rectified. On this basis, obtaining title insurance is generally considered unnecessary in the Cayman Islands.

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What is stamp duty? How and when is this assessed?

Stamp duty is a one-time tax (land transfer fee) that is paid to the Cayman Islands Government, usually by the purchaser. On real estate transactions, stamp duty is payable at a prescribed rate — usually 7.5% of the market value of a property or the price paid, whichever is higher. Stamp duty is assessed when the transfer of property documents is presented for registration at the Cayman Islands Land Registry. The Cayman Islands Government will then assess the market value of the property to ensure that it is receiving the correct amount of stamp duty.

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Can you obtain residency by investment (RBI) through real estate in the Cayman Islands?

The Cayman Islands has long been favoured by foreign real estate investors for several reasons; not only are the islands tax neutral and home to a world-class financial centre, but the modern infrastructure, excellent airlift, glorious year-round weather and low crime rates provide a quality of life higher than many other islands in the region. While Cayman does not offer a citizenship-by-investment programme, there are a few residency options for those looking to relocate to this British Overseas Territory. Contact a sales specialist today to learn more.

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Aside from the sales price, what other costs are associated with conveying property in the Cayman Islands?

Purchasers will pay stamp tax, which is 7.5% of the purchase price (excluding chattels) for most properties. Vendors will pay commission to the realtor that sells the property – the commission rate is normally 5% (4% and 6% on some properties). Other costs may include home inspections, valuations (e.g. for mortgages), legal conveyancing and stamp tax on mortgages. Many financial institutions require mortgage clients to purchase life insurance and property insurance.

The ease of conveying property with the support of professional advisors and an efficient government process is just one reason why the Cayman Islands is one of the premier Caribbean nations for owning vacation, investment and full-time residential properties. 27


MEMBER OF CIREBA

provenanceproperties.com +1.345.640.7000 45 Tanager Way The Residences at Seafire Seven Mile Beach, Grand Cayman Cayman Islands