Cuba: let a hundred golf courses bloom
- Submitted by: manso
- Editorial Articles
- 08 / 12 / 2011
August 12, 2011 5:49 pm by Ron Buchanan. The developers of what will be the Cuban Revolution’s first private golf and residential complex are claiming a hole in one.
Sceptics have long questioned the Cuban government’s reluctance to grant full property rights to foreigners who invest in real estate. But all these doubts have been quashed, said Chris Nicholas, managing director of Ottawa-based Standing Feather International, which is due to sign on a golf and residential development in eastern Cuba with the Cuban state company Palmares.
Standing Feather had been assuming that the homes in its Loma Linda Golf Estates project would be granted 99-year leases to the foreign owners, already a big breakthrough for a government that espouses communism.
But now the property rights are unfettered. “The government has assured us that the homes in our project will be granted property in perpetuity,” says Nicholas.
Not all of Cuba’s competitors in the sunshine real-estate market can say the same. Mexico, for example restricts foreign ownership of real estate on its coasts; in practice, ownership is exercised by a trust fund, adding to the cost and red tape of any transaction.
Including Loma Linda, about four golf and related residential developments are on the drawing board for Cuba, with the state-owned Palmares company as joint-venture partner in each of them. When fully built-out, Loma Linda will represent an investment of $455 million, Nicholas maintains.
Together, industry sources say, all four projects are likely to involve more than $2bn. They represent part, says Nicholas, of a complete change of the economic environment for Cuba.
For the first time since the early years of the 1959 Revolution, Cubans are now going to be able to buy and sell their own homes. Private enterprise is beginning to blossom, though still on a relatively small scale.
But the government has much bigger ideas. These include the development of a deep-water port and industrial complex at Mariel, scene of the historic 1980 boat-lift when thousands of refugees fled to the US.
Mariel, near Havana, will be foreign-managed with thousands of hectares for industrial development in a free-zone complex. All over the island, privately owned apartment complexes are to be built for ownership or rental by foreigners.
“It all means a massive change of Cuba’s economic model,” says Nicholas. A change, however, that could generate internal resistance from supporters of a very different model, hostile to foreign investment and private ownership. Not to mention likely resistance to the removal of payroll padding that has been the norm of state enterprises.
Palmares, the state company that is partnering the golf developments, will have its own budget. It can decide on who and when to hire and fire, and make its own investments. Just like the state oil companies of Norway and Brazil, leaving the government only to impose taxes and regulation. So says Nicholas.
If it works, the “bourgeois game” once berated by Hugo Chávez, the Venezuelan president and Cuba’s closest ally, could breath new life into the island’s economy.
The only existing 18-hole course in Cuba is state-owned and is in the beach resort of Varadero about 85 miles from Havana.
The government’s revival of interest in the sport began in about 1995-96 in a drive to offer more variety for foreign tourists sated by sun and salsa. But the Eureka! moment came when officials realised that golf alone would not be profitable. Following the well-worn track of developments all over the rest of the world, golf and real estate had to go hand in hand.
In the long term, the planners aims to have 16 golf and residential developments. Such numbers will probably have to wait for a political rapprochement with the US, however. No US companies are permitted by Washington to invest in golf or anything else in Cuba.
The current golf and residential projects are all led by Canadian, British and Spanish investors.
Loma Linda is under starter’s orders to be the first golf course to be built. Its location is in Holguín province on the east of the island; the others are on the west.
In the Varadero corridor, the Carbonera Club is a venture of Esencia Hotels & Resorts, a British-owned company that has been working for seven years in Cuba where it already has what is rated as the country’s leading boutique hotel.
One and possibly two more are to be developed by Spanish hotel groups in Pinar del Río, where what is rated as the world’s finest tobacco is grown. One of them is being promoted by Barcelona-based La Playa Golf & Resorts. Leisure Canada has a project at Jibacoa just east of Havana.
Will they all make it to the 18th hole? Who can tell? And golf can be an exasperating game. As the late wayward genius of the sport, Severiano Ballesteros once said: “I’d like to see the fairways more narrow. Then everyone would have to play from the rough, not just me.” Just a little bit like Cuba itself.