The tourism industry in the U.S. Virgin Islands is robust, Gov. Bryan told attendees at the Caribbean Hotel and Resort Investment Summit in Miami Beach on Tuesday, adding that now is the time for investors to take advantage.
According to a statement from the Department of Tourism, Bryan told investors attending the conference that the territory has about 2,500 of its 4,500 hotel rooms available, with three of the four major hotels still undergoing repairs. Bryan said the territory received an estimated 1.9 million annual visitors in 2018 and airports on St. Thomas and St. Croix are operating at about 90 percent capacity.
He said the government is working to encourage building of housing to rent to visitors through the online Airbnb service.
St. Thomas Airbnb bookings shot up more than 600 percent from 2017 to 2018 and as of March, Airbnb projected 2019 bookings would increase beyond that by 338 percent. Airbnb even ranked St. Thomas its number one destination in 2018.
St. Thomas has historically received the overwhelming bulk of tourism and still does. But St. Croix and St. John also saw big gains in Airbnb visits.
This growth has come even as air arrivals dropped sharply in early 2018 after the storms of September 2017.
As of August 2018 there were 1,430 Airbnb listings in the territory: 830 in St. Thomas, 350 in St. Croix and 250 in St. John, according to Department of Tourism budget testimony. At the same time there were only around 1,800 hotel, timeshare and bed and breakfast rooms online – down from more than 4,500 before the storms of 2017. By that measure, Airbnb appears poised to overtake traditional hotels.
Overnight stays tell a different story, one of growth, but not as dramatic. Through the end of July or beginning of August 2018, 17,200 people had stayed in Airbnb accommodations in the territory. St. Thomas received 10,200 visitors staying in Airbnb properties for 2018; St. John saw 2,200 Airbnb guests, and 4,800 people stayed in Airbnb locations on St. Croix.
That amounts to just under 8 percent of all air arrivals from January through July of 2018.
In 2017, Airbnb signed a deal with the V.I. government to automatically collect and remit the territory’s hotel occupancy tax from its V.I. rentals. And of course visitors spend money while they are here.
Bryan pitched potential developers on the 100 percent deduction on local taxes and 90 percent deduction on federal taxes, and said the Bryan/Roach Administration would help developers through the permitting, financing and construction phases to get a new hotel built in the territory.
“Right now we have opportunities in the Virgin Islands where you can take your capital out and get a tax deferment, [that’s] a U.S. tax deferment, for 10 years. Anything you make from that money, you get that tax-free as well, and any of the dividends from that money is tax-free,” Bryan told conference attendees. “We’re going through tremendous growth.”
At the panel discussion, which included Bryan, British Virgin Islands Premier Andrew Fahie and President Daniel Gibbs of the Collective de St. Martin, Bryan also discussed the V.I. government’s support for smaller hotels to assist as they rebuild and begin hosting travelers again.
“If you look at our numbers from year to year, even with the storms, we’re still coming back to our high of 2.6 million [visitors], which was in 2012, very, very rapidly,” Bryan said. “This year from last year, we’re up to 1.9 million in total passengers to the territory.”
He also talked about the tourism experiences offered on St. John, which is considered a luxury destination with an eco-sensitive tourism product. And he said St. Croix is one of the top priorities of his administration as the island continues to develop and attract visitors in search of authentic Caribbean experiences.
“We’re trying to do the things now that will make sure that St. Croix will be a destination, complete with giving it its own identity,” Bryan reportedly told the investors attending the conference.
He said the territory is working with the hotel and cruise industry to bring St. Thomas back as a premier tourist destination as quickly as possible after the 2017 hurricanes.
With a $40 million waterfront project on St. Thomas, $20 million in upgrades at the Cyril E. King Airport coupled with the enhancements underway on Main Street on St. Thomas, the territory’s capitol is poised to host more travelers as infrastructure upgrades begin, he said.
“We’re looking very aggressively for new attractions to come to the island so people can see a new St. Thomas when they get there,” Bryan said. “On St. John, we’ve lost our luxury product, Caneel Bay, which was destroyed during the storms, and we’re making all the arrangements and working with the owner there to get that resort open.”
“On St. Croix, lots of things are happening there as well. A $33 million stadium is going in in Frederiksted. Lots of incentives are coming up now where we’re able to do our ‘One Town Frederiksted,’ which is our main cruise port, to encourage the building of Airbnb’s” Bryan said.
“We have a $25 million arena that is going in at the university so that we can accommodate large conferences as well as tournaments, like our Thanksgiving tournament on St. Thomas, Paradise Jam for college basketball, he said.
The Caribbean Hotel and Resort Investment Summit is an annual event that provides opportunities and insight for investors and other entities of the finance industry to network and interact with governments, businesses, and stakeholders in the hospitality industry to include the Caribbean Tourism Industry. The three-day event is attended by delegates who are focused on hotel development and investment in the region, and it features an extensive array of sessions and panels led by hotel, cruise, and finance industry experts.
“We found it important to actively pursue hotel investment by attending meetings like this where experienced investors that know the Caribbean product is attending. we were happy to share with them the opportunities in the U.S. Virgin Islands,” Bryan said.
Others attending the conference with Governor Bryan included Tourism Commissioner Joseph Boschulte; Government Employees Retirement System Administrator Austin Nibbs; Economic Development Authority Director Kamal Latham; and V.I. Port Authority Executive Director Damian Cartwright.
While there the governor had one-on-one meetings with numerous hotel investors.
Video of the Governor’s address is available on the Government House Facebook page.