The robust real estate recovery in the Turks and Caicos Islands continued in 2015 with total market sales volume expanding by more than 18 percent over 2014 and dollar volume growth expanding from $210 million to more than $250 million.
What was the cause of this “banner year” and the continuing upwards trend through the first quarter of 2016? I believe it is a direct result of the Turks and Caicos Islands accessibility to North America for those demanding luxury and ease of use. Single-family home sales, once one of TCI’s weaker market segments, performed like a market leader with sold listings up by 12 percent and a 38 percent increase in dollar volume in 2015.
The managed luxury villa development model continues to gain traction, and I expect to see continued broad growth in this sector, as a second or third home has the potential to become a legitimate business interest, while still providing that “legacy” investment for the family. Surprisingly, our condo market did not do as well in 2015, but that, for me, comes down to a lack of inventory after the surge in sales of 2013 and 2014 and the fact that investors can make increased returns via a “self-managed” investment (villa in short-term rental market) versus a “resort-managed” investment (condo in short-term rental market). There are obviously pros and cons, but if the right management company is introduced, then the yield on a villa can be exponentially greater than a condo. Further, you do not have the headaches of being part of a strata and governed by bylaws.
That said, I do forecast a reemergence of the condo market in 2017, as there are major projects in the pipeline. The Ritz-Carlton Residences are about to break ground in Grace Bay, which will bring about an influx of recognized luxury brands with island chatter concerning potential W and Viceroy Hotel developments that may not be too far in our future. Certainly this will increase our condo inventory and elevate the standard of luxury by way of increased amenities and service.
Another real estate investment aspect that I think is worth exploring is mixed zoning development. With tourists demanding that they be within walking distance of restaurants, shops, and the “world’s number one beach,” the savvy developer should be looking at those land lots that are tucked just off Grace Bay Beach. A great example would be Grace Bay Court, which is set back behind Grace Bay Club. The potential for this development is limitless: plenty of raw land, good access, heart of the tourist district, a well maintained building housing existing businesses providing immediate revenue generation. The only thing better than owning a slice of paradise is owning multiple slices of paradise and being paid for the pleasure!