CAYMAN BRANCHING OUT WITH CRUISE PORT AND DOWNTOWN GEORGE TOWN DEVELOPMENTS Following last quarter’s record-breaking tourism numbers in the Cayman Islands, as well as enhancements to continue the momentum, the destination has moved full steam ahead on two significant projects: its cruise and cargo port and developments in downtown George Town. The cruise and cargo port will reportedly cost just under CI$200 million to build, government revealed on August 5 as it formally announced the Verdant Isle group as the preferred bidder for the project: a significant milestone in a project that has been in procurement for some six years. The group—comprised of Carnival Cruise Line and Royal Caribbean, along with local construction companies McAlpine and Orion Marine—will fund the project through capital from the two cruise lines and a loan from FirstCaribbean International Bank: what Premier Alden McLaughlin called a “unique financial structure” that ensures no risk to the government, with no single cruise company controlling the pier, and proof that the cruise lines are financially invested in the long-term success of the Cayman Islands. In return, Verdant Isle will receive a portion of the head tax, with the difference in the passenger fee increase and a government allowance going to the 56 THIRD QUARTER 2019 | TRAVEL & CRUISE
group. However, overall costs will remain roughly the same through the elimination of the tender fee and the government’s reduction of its head tax share. While government will take approximately $2 per passenger less in head tax, it expects to make up the difference through increased arrivals. Premier McLaughlin said he believed government had secured a great deal for the Cayman Islands, continuing that the final design improves the environmental impact by moving it to deeper water and involving a coral relocation project. While acknowledging there was much work to do before construction begins, including an updated environmental impact assessment on the final design, geotechnical studies of the harbor and the finalization of the contract, the premier said he believed work would not begin until next summer at the earliest, with construction expected to take two and a half years. Funding from other cruise lines, who had signed letters of intent offering part financing to the project, will not be required. Instead they, have agreed passenger guarantees with Verdant Isle in exchange for priority berthing rights at the new pier. Separately, George Town Manager Colin Lumsden and other officials addressed the public in late July to provide an update on developments in downtown George Town. Lumsden shared some of the development plans—which incorporate mixed-use buildings, commercial and institutional areas to boost business growth and multi-family sites and single-family dwellings to improve housing diversity—and informed that a ‘complete streets’ concept is being explored to integrate bike lanes, sidewalks, safe crosswalks and trees into the zone’s roadways, with the hope of making George Town both more modern and welcoming for residents and visitors alike. He continued that city planners are focused on a 200-acre space along Harbour Drive, and that though some ongoing efforts—such as code reforms, capital infrastructure development, public consultations and minimum operation upgrades—will carry on past 2022, the research and planning phase is expected to conclude by 2020.
Governor Albert Bryan Jr. addressing CHRIS delegates in Miami
INVESTOR EXCITEMENT FOR USVI TOURISM USVI Governor Albert Bryan Jr. is extremely encouraged by the response of investors to the tourism opportunities and incentives offered by the Territory. He shared that excitement at the Caribbean Hotel and Resort Investment Summit (CHRIS), especially as he and the Territory’s team broadcast a strong message “that we’re open for business.” He informed that federal resources are being invested into the infrastructure to drive his administration’s plans for presenting St. Thomas as a top tier tourism product, while developing distinct identities for St. John and St. Croix. Also fueling the excitement, he added, were the high number of arrivals at airports and strong cruise ship numbers returning after the 2017 storms. The governor, who addressed a plenary conference session featuring heads of government from the British Virgin Islands and French St. Martin, said some investors were awed at the scale of incentives the USVI government offered businesses. “To have a destination in the United States, where you can get 100 percent exemption from your state taxes and 90 percent exemption from your federal income taxes, is just incredible.” Describing the importance of the industry, Governor Bryan asserted that tourism is an export business. “The hotel product is sold to people from foreign places. Getting them to our islands and getting them in the hotel is the battle, but we don’t actually make a lot of money directly off our hotels. It’s the ability to house people who shop, eat, want to play, want to