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How To Make The West The Best
Attracting cost-conscious travelers to Puerto Ricos wild, wild west, creating jobs and improving infrastructure are some of the challenges of this Sundays Multisector Summit for Tourism Development of the west coast. More than $500 million in new investment may be in the pipeline.
BY EVELYN GUADALUPE-FAJARDO
April 26, 2001
Seeking solutions: Puerto Rico House Speaker Carlos Vizcarrrondo mobilizes government and private sector to revitalize tourism in the west
The elusive dream has become urgent. A thriving tourism industry generating thousands of jobs on Puerto Ricos west coast is now needed more than ever.
A traditionally depressed regional economy, turned worse by recently announced manufacturing plant closings, and uncertainty about the prospects of grandiose economic development initiatives such as the west coast Technology Corridor have prompted public and private sector officials in 16 western municipalities to take a fresh look at an old prescription: to turn the region into a tourism development mecca.
And, of all people, House Speaker Carlos Vizcarrondo is leading the effort, with a new twist.
This Sunday, more than 20 Calderon administration cabinet officials and agency directors, 16 mayors [IS IT 18?], and several influential developers & investors from the tourism sector will meet at the islands first Multisector Summit for Tourism Development in the West Coast, to be held at the Best Western Mayaguez Resort & Casino.
The topic is simple: what and how much is needed to transform Puerto Ricos west coast into a prime tourism destination.
The strategy is to focus on the western regions ability to provide a quality, moderately priced, leisure tourism product that would bridge Puerto Ricos competitive disadvantage in that market.
Committed to attend are Luis Falto, president of Empresas Falto; Frank Stipes, president of Westernbank; Carlos Carro, president of Advance Cardiology Center; Fernando Rivera, president of the Puerto Rico Shippers Association; Jose Busto, president of Continental Shipping; Willie Santana, director of Empresas Santana; Marcos Rivera, president of the South Western Industrial Association; Wilhelm Sack, president of the western region committee of the Puerto Rico Hotel and Tourism Association (PRHTA); Louis Muñoz, vice president of the Best Western Mayaguez Resort & Casino; Rafael Molina, president of the Chamber of Commerces western region; Gov. Calderons chief of staff Cesar Miranda; and Jorge Pesquera, designated executive director of the Puerto Rico Tourism Co.
The western regions potential as a tourism mecca appears to hinge on the regions ability to focus on the needs of price-conscious leisure travelers who would stay in Puerto Rico for more than the average 2.7 days.
Thats a huge market that for years has stayed away from the posh San Juan and Northeast coast beach resorts and has instead flocked to other Caribbean destinations such as the Dominican Republic and Cuba.
The Puerto Rico Tourism Co. has committed to promoting the natural resources and tourist attractions found around the islandincluding those that are unique to the west coast like whale watching and eco-tourismin its new advertising campaign scheduled to be unveiled late this summer.
Meanwhile this week, a $500,000 intra-island billboard advertising campaign was launched under the auspices of the Puerto Rico Tourism Co. and both legislative bodies of the Commonwealth government. The campaign is designed to emphasize the islands natural beauty in order to build internal tourism and create a local awareness of the value of tourism to the economy and the need to keep the island clean to enhance the tourism effort.
Besides tourist attractions, west coast government and private sector officials are banking on the regions potential to attract European travelerswho today make up barely 5% of Puerto Ricos tourism marketwith affordable room rates.
There are currently 948 rooms among PRHTA member hotels and inns in the west. Another 900 rooms in non-member hostelries add up to a total of nearly 2,000 lodging rooms in the west.
The average room rate in the west coast fluctuates between $80 to $150 per night, compared to the more expensive rates found in San Juan that start at $125 per night, depending on the season, and may be as high as $1,200 per night.
How did the summit idea begin?
Last month, Vizcarrondo was invited by the PRHTAs western region committee to attend on one of their monthly meetings at which distressed hoteliers told how tourism development in the region had been neglected for years by the government.
Common complaints pertained to the west coasts overlooked infrastructure problems such as poor water and electric power service as well as bad road conditions.
To make matters worse, the west coast is witnessing the closing of some of the islands largest manufacturing plants, like tuna cannery Star Kist in Mayaguez, which employed thousands of people from neighboring municipalities.
Upon hearing the plight, Vizcarrondo stood ready to commit his time and personal effort to help resolve the western regions economic problems through a major, concerted effort to spur the development of a world-class tourism destination along Puerto Ricos west coast. Thats how the idea of a summit was officially born.
"I am convinced that we can immediately integrate multisectoral economic growth through this tourism development effort," Vizcarrondo said. "We dont need to reinvent the wheel to improve the economy, we can maximize the promotion of our natural resources now, developing tourism as the foundation for economic growth."
Part of Vizcarrondos input will be to analyze the possibility of turning over to Mayaguez, the largest municipality in the region, the management of the government-owned and run Rafael Hernandez Airport in Aguadilla.
Vizcarrondo is also contemplating the imposition of the governments 7% room tax on west coast inns, condominiums, and small hotels that are currently not being taxed yet are being used as tourism lodging facilities.
Lastly, Vizcarrondo is analyzing the possibility of developing an incentives program for local businessmen who want to establish an air cargo or airline company in the western region of the island.
"It was made clear to me that the west coast hoteliers were tired of hearing empty promises and unfulfilled proposals for evaluating the possible development of the region," Vizcarrondo said. "So I decided to take action immediately."
That action, with the help of marketing strategist Enrique Grau, involved the coordination of government & private sector leaders, who have either pending projects to develop or projects under construction in the west coast, to meet face-to-face and discuss a short-term action plan.
These leaders are committed to transforming the 16 municipalities starting from Guanica to Isabela as well as Maricao, Las Marias, and San Sebastian into one of Puerto Ricos prime tourism destinations.
"I believe the loss of jobs and closing of manufacturing plants is causing a psychological effect that is ruining investment initiatives in the region," Vizcarrondo said. "So we must come here [to the summit] with real concrete efforts to restore hope to these economic sectors in the west coast."
If the government doesnt do something effective to substitute the loss of jobs in the manufacturing sector, Vizcarrondo indicated that the west coast should declare itself bankrupt.
It is no secret that so far, Vizcarrondo has secured investment commitments from several private investors of nearly $500 million to upgrade tourism facilities throughout the region.
Private prowess--Luis Falto and Willie Santana
Falto, president and CEO of the Best Western Mayaguez Resort, has just been given a green light by the Puerto Rico Planning Board to begin his hotels $100 million master expansion plan that should be completed in the next five years.
The plan includes the construction of villas, two condominium buildings, multilevel parking, a river pool, and hotel suites, in addition to remodeling the existing facilities.
Sprawling over a 22-acre site, a third of which is now developed, the hotel will begin construction of a $4.5 million river pool, and some 69 villas surrounding the river pool-- each one featuring three apartments for a total of 207 units at an investment of $13 million.
In addition to the villas, the hotel will invest $33 million in the construction of two apartment buildings featuring 46 units each. The hotel will also invest $8 million in the construction of 60 additional hotel suites to be located near the hotel lobby area, which will also be remodeled. The original investment was set at $70 million, but Falto is now contemplating adding more rooms.
A $5.2 million investment will be for the hotels multilevel parking garage that will have a capacity for 500 cars. The 10th and top floor of the garage will be used for an enclosed expo center.
Falto is also interested in a pier development with another investor, Willie Santana, director of Empresas Santana. To be called Windows of the Seas in Mayaguez, the $5 million project would be a sport-fishing pier where the partners could also develop hotels close to the marina.
Santana, whose company holds the franchising rights in Puerto Rico for Howard Johnson, claims the hotel has expressed interest in the project.
"The Howard Johnson chain is interested in having a hotel on five acres next to the pier," Santana said. Empresas Santana currently operates a Howard Johnson hotel in Isla Verde.
The fishing pier would be the start of a potential major private and government development of the Port of Mayaguez to handle cruise ships and other tourism related activities. The cruise ship port project investment is estimated at nearly $500 million.
The Port of Mayaguez is 30 feet deep, which allows for the entrance of mid-size cruise ships.
Last week, Vizcarrondo met with Michele Paige, president of the Florida-Caribbean Cruise Association (FCCA), to discuss what would be needed to transport cruise ships to Mayaguez. According to Vizcarrondo, the FCCA is interested in increasing the cruising industry in Puerto Rico.
"We believe the opportunity exists o the west coast to handle cruise ships," said Fernando Rivera, president of the Shippers Association. "The west coast has numerous tourism attractions and the cruise industry has a genuine interest in Puerto Rico. They want Puerto Rico to be the axis of the Eastern Caribbean."
Santana pointed out that the west coast is not interested in taking away tourists from San Juan, which would defeat the purpose of the summit.
"We are targeting a more price conscious tourist, similar to the visitors stay at the all-inclusive resorts in the Dominican Republic," he said.
Empresas Santana is a main provider of aviation services at Luis Muñoz Marin International Airport. Santana recommends converting western Puerto Rico into a charter flight destination. But that is easier said than done. It would entail a government investment to fix up the west coasts airport facilitiesin Mayaguez and Aguadilla.
The government is in the process of purchasing the navigation equipment that is necessary for the Federal Aviation Administration to certify the Rafael Hernandez Airport in Aguadilla, in order for larger planes to land there.
As soon as the airport is certified, American Eagle plans to operate daily flights from San Juan to Aguadilla.
Six developments with no government funding
Despite poor infrastructure conditions, investors have definitely seen potential in the islands west coast. A burgeoning tourism industry has developed in the region in the past few years. It is also known by tourists as the place to go to relax and stay away from the hustle and bustle of the city life. The west coast is known for its quaint inns, guesthouses and mid-sized hotels rather than the large hotel chains or resorts found in the San Juan metro area.
Considered a linchpin in west coast development is the planned Monte Carlo Resort in Cabo Rojo. The $2 billion project will include 1,300 hotel rooms and 2,700 residential units. Currently, there are six major developments under construction on the west coast, representing 405 rooms with a total investment of $100 million. These projects are Villas de Costa Dorada, a 36-room expansion, in Isabela; Paradise Village Resort, a 108-room hotel in Isablea; Villa Montaña, a 16-room expansion, in Aguadilla; Rincon del Mar Beach, a 103-room hotel, in Rincon; Rincon Beach Resort (Playa Almirante), a 120-room hotel in Añasco; and Horned Dorset Primavera Villas, 22 luxury villas in Rincon.
"These hotel projects are all being developed with private sector funds," said PRHTAs Sack who is also partner in the Horned Dorset Primavera in Rincon. "The west coast hoteliers also have the commitment to deal with wholesalers once we have the airlines to fly into the region."
Wheres the financing?
"We have to analyze each project to make sure its viable," said Westernbank President Frank Stipes. "Any tourism project presented at the summit should have earnings projections."
Stipes, a native of Mayaguez, says his bank is ready to provide financing to tourism development projects. So much so, that a source said Westernbank is willing to provide a lower interest rate than the conventional loan rate, only if its a tourism-related project.
"To transform the west coast into a prime tourism destination, developers & investors must join as one, with one common goal," Stipes said. "The west coast has to function as one region, the investors must take a more macroscopic look at development."
Stipes indicated that now is the right time to invest due to the closing of manufacturing plants and the economic slowdown. "All these factors in the economy present an opportunity for potential investors to capitalize on them," he said.
Improvement of the west coasts economic situation must also entail an educational program so locals know the importance of making the regions towns, plazas, streets & residential areas more physically attractive. The billboard campaign launched this week speaks to that effort.
As part of the recently approved American Airlines (AA)-Trans World Airline (TWA) deal, TWAs daily flight from Newark to Rafael Hernandez Airport in Aguadilla will to be discontinued effective May 1. According to AA, the Aguadilla flight will be discontinued because it doesnt make economic sense to continue the service.
Enrique Cruz, managing director of American Airlines in San Juan, met with Vizcarrondo to discuss the possibility of continued AA service in Aguadilla but told him no dice, American Airlines wont fly into service to Aguadilla any more.
Despite that, AA does plan to provide some kind of incentives package to help lure potential west coast visitors---a summer sale for its American Eagle flights from San Juan to the Mayaguez airport.
American Eagle operates four daily flights to Mayaguez. Prices will be cut by 25% for those traveling from the States on the weekdays and those traveling on weekends. A 90-day maximum stay will receive $50 premium. The sale is valid until August 31 from destinations such as Hartford, Boston, Baltimore, Dallas, Newark, Ft. Lauderdale, Dulles Washington, New York (JFK), Orlando, Miami, Philadelphia, Tampa, Los Angeles, San Francisco, Atlanta, and Houston.
This Caribbean Business article appears courtesy of Casiano Communications.