Slowly but surely, Puerto Rico is attempting to relive its golden age, by attracting out-of-towners with a widening array of luxury real estate options.
Facing a recession that has lasted longer than the one in the United States, the Island of Enchantment is luring big spenders with attractive offers—tax incentives—and a growing number of resort-style communities.
Sotheby’s, the famous auction house, recently entered the luxury real estate game in Puerto Rico through one of their Sotheby’s International Realty affiliates. But they are not the first. Sotheby’s main rival, Christie’s—the iconic and currently largest auction house in the world—planted their flag in the island two years ago.
Christie’s luxury real estate venture—Christie’s International Real Estate—is affiliated exclusively down in the island with Trillion Realty Group, which is run by the mother-daughter team of Leticia Brunet Gonzalez and Ani Gonzalez Brunet. The pair saw an opening in the market for luxury real estate after the real estate market in Puerto Rico crashed.
“Our decision was to revive the luxury market,” Gonzalez Brunet told VOXXI. “[Until that point] no one had thought about affiliating with an international corporation in the luxury market.”
That luxury real estate market is largely comprised of properties above the $1 million mark. In the past few years, more and more resort-style communities have surfaced along the coast of the island, attracting the likes of many well-known personalities, including St. Louis Cardinals outfielder Carlos Beltran and boxer Oscar de la Hoya.
Puerto Rico’s luxury real estate market offers exclusivity
For Gonzalez Brunet, the “luxury” qualification is not solely dictated by price, but also by the uniqueness and exclusivity of the luxury real estate property.
“We try to focus in high-end, unique properties,” she said. “That’s a huge difference in the international market between Christie’s and Sotheby’s.”
Sotheby’s is just getting started in Puerto Rico. Their franchise there is owned by Margaret Pena Juvelier, who is a former senior vice president and associate broker from Sotheby’s East Side Manhattan Brokerage office in New York. And it’s about to bring even more business for an economy that desperately needs it.
It wasn’t always like that, of course. Puerto Rico’s resorts saw a flurry of well-connected and well-known personalities once upon a time. But as things got tough, the not-so-tough got going… out of the island. Gonzalez Brunet and her mother are trying to change that.
“Puerto Rico is a very limited resource, and people value the fact that we have the U.S. flag and it’s a solid investment from a title-ownership point of view,” she said.
Luxury brands like St. Regis and Ritz Carlton have opened locales on the island in recent years. The St. Regis Resort is located in the exclusive Bahia Beach Resort, which is located in front of the beach and right by the rainforest in Rio Grande, Puerto Rico. Bahia Beach counts with a golf course and exclusive residences, including villas, townhomes, apartments and The Residences at St. Regis, which are 26 estate homes in a private island.
Meanwhile, The Ritz Carlton now operates what used to be Hyatt’s Dorado Beach Resort. The Ritz has converted Dorado Beach into “a Ritz Carlton Reserve.” Dorado Beach has been an institution in Puerto Rico since the 1950s, when Laurance Rockefeller bought the land and hired golf architect Robert Trent Jones to design the golf course around which the resort would be built. Now it counts with countless amenities, including a restaurant from acclaimed Spanish chef Jose Andres.
Puerto Rico’s luxury real estate market has some competition in the Dominican Republic and Panama. However, for some people, to go to the island is to go abroad without needing a passport or a lengthy flight. Gonzalez Brunet said that Gov. Luis Fortuño’s tax incentives were a big part of the reason why the island is seeing a real estate renaissance of sorts.
“You buy an existing property and you are 100 percent capital gains exempt,” she said. “And you don’t have registration or mortgage fees.”
These benefits will expire at the end of the year, but many expect them to continue if the governor is re-elected.
“We’re looking for the buyer that believes in the value of real estate in Puerto Rico,” Gonzalez Brunet said. Meanwhile, they need to accommodate those buyers’ needs.
“Clients are looking for amenities, they’re looking for privacy, they’re looking for uniqueness and value,” she said. Perhaps this is a match made in heaven.