After Devastating Destruction, Caribbean Looks To Rebuild

There is no escaping the despair facing residents in Puerto Rico, the Virgin Islands, Barbuda and other Caribbean islands devastated by the one-two punch of hurricanes Irma and Maria in September. Homes were destroyed. There was no water, no power, and no sign of work for the tens of thousands of people who depend on the vital tourism industry.

"Damage was severe and unprecedented—sustained winds of 185 mph and 220-mph gusts are an incredible force," said developer Saro Spadaro, president and CEO of The Maho Group on St. Maarten. "In my 17 years working in the Caribbean, and a lifetime of traveling here, I would have never imagined a storm as powerful and devastating as Irma was."

"Hours after the storm had passed I recall visiting one of our condominium buildings that was built out of reinforced concrete and all that was left of the structure was the concrete," he said. "Everything else including windows, doors, interior partitions, furniture and bathrooms was gone."

Meanwhile, some Caribbean islands, even ones very close to heavily damaged islands, were spared for the most part. These players in the luxury real estate business feel extraordinarily grateful for their luck and they’re moving forward with plans to rebuild any damaged buildings and welcome back visitors.

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Less than two months after Irma and Maria slammed through, mountains of debris are disappearing and signs of progress are everywhere. And the people who love these islands, who have been coming for decades, are beginning to return. After all, the lucrative winter tourism season is close at hand and everyone who is able to participate wants to be a part of it.

"We were extremely lucky," said Mike Meldman, CEO of Discovery Land Company, which is developing a different luxury residential neighborhood called Baker's Bay Golf & Ocean Club in the Abaco Islands of the Bahamas. "We evacuated twice, but both storms missed Baker’s."

Rufus Gobat, the developer of Tamarind Hills on the island of Antigua, about 30 miles from the devastated island of Barbuda, said that his resort development was also spared.

"Some of those islands have been desperately hurt and we’re all helping out as much as we can," Mr. Gobat said.

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Alternative islands see an influx of interest

Antigua, like other islands with limited damage, is getting rentals and other business from people who planned to vacation or buy on St. Maarten or another of the wrecked islands.

"We’ve had an influx of business, particularly from St. Bart’s," Mr. Gobat said. "Obviously it’s sad, but Antigua is going to actually have a bumper season."

Antigua is one of the premier yachting centers of the Caribbean, he said. "The main competition was the island of St. Maarten and the British Virgin Islands. Now those islands are out of action, and there are so fewer places for people to go."

Bryant McClain, who works as a consultant for Caribbean developers, helping them set up their sales and marketing programs for high-end resorts and residential developments, agreed with Mr. Gobat’s assessment.

"The decreased inventory has basically created a huge demand for other Caribbean islands not affected by the storm," Mr. McClain said. "You’ve got thousands and thousands of rentals who are looking for a new location."

He is now working with a developer in Belize to build Itz’ana Belize Resort & Residences, which features a 20-room boutique hotel and 80 high-amenity homes that can be rented out by the night. So far, all but 13 of the homes have been sold, with beachfront home prices ranging from $475,000 to $1.13 million, he said. They were lucky enough not to have damage.

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"You hate to say it, but one area’s misery means traffic for other areas that were not affected by the storms," Mr. McClain said. "It will make for a very strong first year for us."

In early October, the hotel began offering rooms for December. "Everything for December was taken in a matter of hours," he said. "We could have booked out five of the hotels."

Still, though, so many people have been scared away from the whole Caribbean because of the hurricanes, Mr. Gobat said. "There is definitely the perception that it’s all one place, rather than the hundreds of islands and thousands of miles that it really is."

The island of Grenada, for example, is outside of the main hurricane belt and has only had one hurricane in the last 70 years, said Mark Scott, director of development for Peter de Savary’s Mount Cinnamon hotel and residential villa resort in Grenada.

"We had no damage at all, not even a windy day," Mr. Scott said. "For one or two days we had a slowdown in our reservations, but now reservations are very strong for the coming season."

And reservations often lead to sales, he said.

Bookings are far up from last year, he said. "We’ve had an excellent 2017 and 2018 looks to be even better."

Longer term, he thinks Grenada is well positioned because of where it sits in the Atlantic. "Logically if people are thinking of buying a Caribbean home it is safe to assume after a year like this that they would give more consideration to the southerly islands outside of the hurricane belt."

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Long-term effects in the Caribbean

As devastating as the storms were, Andria Mitsakos, president and CEO of Andria Mitsakos Public Relations, which represents several large developers in the Caribbean, doesn’t see long-term damage to the area’s allure.

"I don’t get the sense that people are leaving because of the storms, saying that’s it, I’m getting out of here," she said. "There’s always another storm, and I’m seeing that people are still investing heavily in the Caribbean. Also, it’s a good time to buy because prices have gone down."

And the vast majority of people take these storms in stride, Mr. Scott said. "They know that September and October tend to be the hurricane season and they know what to expect."

Part of the reason for increased interest in the islands is that there are now so many more direct daily flights from major U.S. and international cities, both Ms. Mitsakos and Mr. Scott said.

"I’ve definitely seen a lot more development in the Caribbean in the last year or two and I’ve been working there 22 years," Ms. Mitsakos said.

"I’m seeing that people want to have that second or third home—there has been an expansion of that," Ms. Mitsakos said. "It’s not just getting a simple hotel room anymore. Families are traveling together, wanting to spend quality time together."

Mr. Spadaro, the St. Maarten developer, agreed. "The Emerald at Maho, our project in pre-construction sales and approximately 50% sold out, suffered no cancellations after the storm," he said.

"The many aspects which makeresidential property appealing—great beaches, great weather except in a storm, the people and the lifestyle—are not going to be washed away or blown away even by the most powerful storm," Mr. Spadaro said.

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Construction delays ahead

Even islands and luxury resort areas well away from the destructive paths of the hurricanes have been affected by the major storms this year.

The 80 homes on Belize that Mr. McClain is helping to develop were supposed to be delivered in January through September next year. Now they are facing construction delays because of storm damage to Florida and Texas.

"So much distribution comes through Miami and Houston," Mr. McClain explained. "All of our lighting came through the Houston port, which was down for three weeks."

"It’s now affecting our delivery dates—it’s something we didn’t even think about."

That has meant that six beach villas that were scheduled to be completed on Dec. 15 now won’t open until Feb. 1, he said.

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A long road ahead for the hardest-hit spots

Meanwhile, homeowners and developers in places like St. John and St. Maarten are looking to rebuild.

"Property owners are very resilient, committed and in love with the island," Mr. Spadaro said. "While St. Maarten may have been battered, it is still one of the most beautiful places in the world."

All condominiums and most single-family homes were insured, he said. The process of assessing damage and filing insurance claims is well under way, and "soon the reconstruction will start."

Shanna Dickerson, the owner of Blue Sky Luxury Concierge, LLC, whose primary business was booking luxury villas and yachts in the British and American Virgin Islands as well as supplying the necessary personal chefs, babysitters and other staff, said that she is seeing similar attitudes in the Virgin Islands.

"So many people really, really love the Virgin Islands and they want to help—they want to come back," she said. "I already have bookings for this December, and for March, April and May, so people are still coming."

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"Their main concern, they tell me, is that they just want to start giving their tourist dollars to help bring it back," Ms. Dickerson said.

"I feel very hopeful—I’m not crying every day anymore," she said.

"I’m saying give it at least six months, at least until we get the power back on," she said. "And you want at least a few of the restaurants to come back—they’re a really big piece of the puzzle."

Long-term, though, it will be a long, slow haul for the Virgin Islands, she said. "I think to fully, fully come back you could be looking at 10 years—it’s just that bad."

"This winter is a write-off," said Mr. Spadaro of St. Maarten. "It will take 18 to 24 months if we all work hard together for the island to come back."’

In Barbuda, an area that saw the worst of the devastation, there’s hope, too. Mr. Meldman said he remains committed to his plan to build 300 homes and a golf course there.

"Every single house was damaged–it’s basically uninhabitable," he said. "We had a lot of landscape damage, but that’s very easy to replace."

Now he and his company are focused on rebuilding homes, the schools, hospital and police and fire stations—and then they’ll come back to the 300 new homes. "We hope to have it all done in the next 18 months to two years," he said. "Then our residential development will piggyback on the basic community development."

"The biggest issue is making sure the local Barbudians will come back," he said. "We’ll rebuild it nicer, with more and better amenities."

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Tweaking development standards

This year’s hurricanes are also having an effect on how developers will build in the future.

"As a developer, we continuously research new materials and technologies which would help us build better," Mr. Spadaro said. "When it comes to building materials, innovation is very important to improve safety and durability."

In the Bahamas, Mr. McClain, through his company, Keen Initiatives, is working with a developer to build 30 super-high-end homes on the private Star Island, part of the Eleuthera chain of islands.

They are now looking at different engineering and construction techniques, including when and where to use concrete versus reinforced wood, how much super-strong hurricane glass to include as well as protections like roll-down shutters and higher elevations to protect against tidal surges, he said.

"You want to present a really confident hurricane plan," Mr. McClain said.

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They are also designing the resort to deal with the long power outages that often come with the hurricanes.

"Star Island will be carbon neutral—100% solar and wind," he said. And the Belize homes will have solar-powered generators.

Mr. McClain remains confident about the luxury Caribbean market.

"The Caribbean is booming.... The Caribbean has always been seen globally as a safe haven."

Mr. Meldman agreed.

"We’re bullish on the Caribbean," said Mr. Meldman, who also owns a home at his Baker’s Bay development. "We have two deals in the beginning stages," including his Barbuda plans. "We like the weather, we like the water, we like the market, we just don’t like the hurricanes."