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Conventional Wisdom Is Putting Its Money On Puerto Rico

Milton Segarra’s past life in the hotel business is paying off in his role as President & CEO of Meet Puerto Rico. After a decade as CEO of a medical services company, he returned to tourism just over a year ago as the island was catching the wind from its new all-star resorts such as Ritz-Carlton’s Reserve at Dorado, Royal Isabella, St. Regis, and W, as well as renovation of its grand dames and a sprinkling of high-end boutique properties.

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On a trip to New York this week, Segarra (right) was making calls on Major League Baseball and targeting the National Football League, not to attract their games, but to get their meetings business. “There are two sides to professional sports,” he said. “One is the event but the other part is the business side.”

As a hotel executive he had major league players and officials staying in his hotel as part of a series of baseball games played in Puerto Rico.  There he found out that major league sports meant major league meetings business, seeking to expand fan bases, holding regional combines to identify talent and even with sports agents who put together post-season groups with their star players. With a tag line “escape the conventional,” the Commonwealth offers the benefits of its affiliation with the United States, including no passports, American business practices, currency, and easy commercial air access for those in the group not arriving on private jets.

Getting meetings business now means getting to the top, Segarra said.  “It used to be you had an in-house meetings department and they would hire a big incentive company. Now decisions on destinations go through the office of the CEO and even the Board of Directors. You need to have the CEO and Board onboard.”

Puerto Rico’s plethora of new five star properties and renovation investment in older properties is paying off. “Companies will usually only have a meeting in one place two or at most three times. To have so many new options is a big benefit,” Segarra said during his New York sales tour.

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While Puerto Rico may have always had a significant industrial base, it is in fact becoming a new global home for elite travelers. MariJo Laborde, Chief Sales and Marketing Director of Puerto Rico Tourism Company, noted that the government’s investment and residence incentives are paying off. Act 20 and 22 target companies and individuals, respectively, making residency or business relocation attractive.

Perhaps the best example of the success is that Puerto Rico’s new super rich residents are investing in their new home, buying hotels, building hotels and restoring and redeveloping areas as future arts and culture hubs. The EB- 5 visa that offers residency is attracting wealthy families from as far afield as China, Brazil and Russia. Entire families are relocating so children can attend U.S. universities.

There has been so much traction from the programs that there is now an annual conference for the super rich and their advisors to review everything from tax treatments to school options and how to get the most out of the diverse culture.

Payoffs from attracting elite travelers can be huge. It is estimated that when Roman Abramovich had one of his mega-yachts in San Juan for repairs over two months it generated $2 million for the local economy, excluding what the owner spent. On a smaller scale service businesses such as concierges are popping to cater to the new Ultra High Net Worth residents.

Clarissa Jimenez, CEO of the Puerto Rico Hotel & Tourism Association (above), believes there is more business from elite travelers in the future with more five star hotels opening, including the long awaited Condado Vanderbilt (below) in December, a J.W. Marriott in Dorado at the end of 2016 and a Four Seasons a bit after that. A yet to be named 150-room luxury resort is expected to join the 22 villas at Royal Isabella, the award-winning golf course developed by tennis hall of famer Charlie Pasarell.

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With hotels often getting more than 25 percent of their revenue from meetings, particularly higher end board and incentive movements that Puerto Rico is now well equipped for, elite travelers may find Segarra in their waiting room looking to give his pitch on bringing you and your next meeting to Puerto Rico.