Bahamas developers profit from a government agreement.

The Bahamas has resumed its hotel development quicker than other islands in the Caribbean, owing in part to a recently amended government policy to reduce building costs. Registered developers are not allowed to pay tariffs on most materials in accordance with the Hotel Encouragement Act, first adopted in the basic form in 1954. In 2009, the HEA was modified to cover entertainment, nightclubs, restaurants and stores in specified locations, which provided developers with a substantial boost. freelancer

Eddie Lauth, one of French Leave Marina Village's development partners, a 270-acre property being developed on Eleuthera, says, "It was very, very useful to us."

Mr. Lauth told WPC News that the HEA saves French leave on construction supplies from 20 to 40 percent, depending on composition. For the first 10 years, the HEA also exempts project taxes from charging and enables developers to import construction equipment without paying customs.

"They [the HEA] have been improved and made it much more doable for developers to apply for it," Mr. Lauth added.

According to Tom Dunlap, President of the Baha Mar, the Hotel Encouragement Act also had a role in ensuring that the $3.5 trillion development on Nassau is being developed. The project, consisting of 2200 rooms for hotels, a golf course for Jack Nicklaus and the "one of the biggest casinos in the western hemisphere," was originally suggested in 2004 but stopped until 2011 when the Export-Import Bank of China obtained financing.

According to Mr. Dunlap, this project was supported by the HEA as well as the renovation of the airport in Nassau and $70 million for road improvements.

Mr. Dunlap remarked, "There were very hands on the government." " The initiative offers the Bahamas people possibilities."

The Hotel Encouragement Act is one of several encouragement to Caribbean countries to encourage developers to make projects in the Caribbean.

Despite high tourist numbers in the area, building of hotels has been sluggish to rebound. According to the industry research firm Lodging Econometrics, 15 hotels with 1,502 rooms are scheduled to open this year, indicating an increase of 0.1% in availability.

The experts claim that lenders are still cautious of building projects in the area. In certain instances, it's cheaper to renovate an existing property than trying to build a new resort.

"Ground-up development in Mexico and the Dominican Republic might make sense to some extent," Wall Street Journal recently informed Rick Newton, partner of Resort Capital Partners, a Caribbean hosting consultancy. "However, on the luxury side it is much simpler to acquire an existing asset and to refine it in some manner, shape or kind."

James Andrews, Senior Managing Director of Integra Realty Resources, told WPC News this week that developers are more interested in luxury projects.

"Developers are looking for a chance to return to the market and re-energize trends that were robust before the slump." Mr. Andrews said.