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Tourism In The DR Means Lots Of Opportunities For Investors

By Luis Asmar, CEO of Compass Financial Advisors

Last week, I was reading an article by a local real estate developer in Punta Cana.

He stated that, “The Dominican Republic is the undisputed king of tourism in the Caribbean…”

And he’s right.

In 2019, the Dominican Republic accounted for 29% of the total tourism market in the Caribbean, more than double its counterparts in the region. Jamaica, the second most popular destination last year, accounted for only 12% of the total visits to countries in the Caribbean.

Over the last decade, year in and year out, the Dominican Republic has dominated tourism in the Caribbean. No other country in the region comes close.

On top of that, tourism demand here continues to grow.

The DR’s position in tourism in this region is why I believe that it’s the only place in the Caribbean that investors should be considering for serious investment.

For investors, the tourism trend going on here translates into a lot of opportunity.

In other words, there’s huge ROI potential here.

Obviously, one of the sectors that investors can capitalize on is hospitality. As tourism visits increase, so does short-term rental demand. You’ve got several large, international hospitality groups developing new hotel and resort properties throughout the country to take advantage of the growing rental demand.

Apple Liesure Group, a U.S-based hospitality conglomerate, bringing in $3 billion in annual revenue, is developing two new, all-inclusive resort in Miches, situated on the Northeastern coast—a total investment of $400 million. Marriott International, the world’s largest hotel operator, is developing a 650-room hotel in Punta Cana. Playa Hotel & Resort group, in partnership with Hyatt, just launched two luxury properties Hyatt Zilara and Ziva in Cap Cana. Hyatt Hotels Corporation in partnership with Pipax Investments is launching a 120-room hotel in Santo Domingo in the Piantini district.

There’s also segment of tourists who prefer smaller boutique-style hotels and B&B’s along with private condo rentals through online booking sites like Airbnb and VRBO.

Tourism, however, drives other industries and sectors outside of hospitality as well.

As more people are introduced to the Dominican Republic via tourism, the more they’ll become interested in idea of living here or simply investing in a second home to spend time with family during the holidays increasing demand for residential development. You’ve got master-planned beachfront residential communities like Casa de Campo and Bahia Principe Playa Nueva Romana that offer condo, townhouses, and single-family home. There are even opportunities for sub-developers to buy parcels of land within these communities and develop their own residential projects.

In Santo Domingo, residential condo buildings sprouting up all throughout the city’s business district.

You can invest in residential development at a commercial or individual investment level. I believe you can make considerable returns on both.

As the development of new hotels and resorts along residential communities grows so does need for infrastructure development such as new roads and highways, electricity power grids, and communications (internet connectivity, cellphone towers, etc…).

The Dominican Republic is looking for new technologies and efficiencies to improve the infrastructure on the island.  For example, the DR, in an effort to improve it electricity generation by using more renewable, clean energy sources is offering special tax incentives—up to 100% tax exemption—for investors to bring this type of innovation to the island.

As a result of tourism, the restaurant, services, and entertainment sectors are ripe with opportunity. With tourists coming into the DR from all over the world, the need for a diverse selection of cuisines is undeniable. In terms of services and entertainment sectors, I see opportunity for gaming (casinos) and the development of family-friendly attractions (water parks, bowling alleys etc.), particularly in areas of the country still developing.

If you’re an investor that wants to diversify your investment portfolio into the Dominican Republic but not necessarily looking to be too hands-on, there’s opportunities for you to directly invest in local businesses, technology ventures, and real estate development here.

To learn more about investing in the Dominican Republic, get in touch with Compass Financial Advisors

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