Turks and Caicos’ luxury real estate market is hot. It’s an easy three plus hours direct flight from New York’s JFK to Providenciales, the largest island in the Turks and Caicos chain. Providenciales is home to the Island’s largest population, luxury resorts and luxury residential development. Those who fly private enjoy the ease of two FBO terminals. Thanks to the islands being a British Overseas Territory, it’s a solid and safe place to vacation and invest attracting both Americans and Canadians.
Over the past 15 years or so, Providenciales has benefited from a major push in luxury residential development. Listen to Mark Durliat CEO and owner of Grace Bay Resorts since 2001. “We hit the big time here in 2004 to 2005. There was a strong demand for second homes, and we carved out a niche driven by baby boomers’ demand for second home real estate coupled with new hotel and resort construction,” Durliat recalls.
Financing became available for the condominium hotel model which, according to Durliat, “offered world-class hotel rooms while giving those second homeowners the opportunity for rental income as a way to offset costs.” As tourism and the destination’s popularity grew, so did the returns to owners. “We were able to bring in high-quality hospitality options because the tourism market was strong and growing,” Durliat recalls.
Fast forward to today with Durliat developing The Rock House expected to break ground this month. These one-and two-bedroom homes are built into the Providenciales cliffside. Pricing ranges from $600,000 to $1.625 million. Resort amenities include a 100-foot infinity pool, tennis courts, restaurant and of course a private beach.
“With The Rock House, we have created a hybrid between a condominium hotel and a version of a branded micro-resort,” Durliat notes. The “cottages” are like single-family homes. Buyers must participate in a rental program by signing a rental agreement.
Rock House buyers Paul and Mary Lou Little of Toronto first came to Turks and Caicos in 2005. “We have been owners here for a long time. It’s very easy for us here since it’s in the same time zone and English is spoken here. There is a solid government here which is important when you’re investing serious money,” notes Mary Lou, a retired attorney.
The couple have known Durliat for years since they first bought a villa and then an estate in Durliat’s Grace Bay Club. They recently purchased a 3,500 square foot property with beachfront at The Rock House for $1.5 million. “Mark makes a great product. We are going to be staying in our larger home and renting this one out and our children and grandchildren will stay there when they visit,” said Paul, a retired investment banker. “When Mark is doing something new, we will be there because everything he develops is the gold standard,” he adds.
Joe Zahn, president, and CEO of Turks & Caicos Sotheby’s International Realty has been in the islands since 1989. Zahn is armed with long-time first-hand market knowledge. “We are the most active we’ve been since before the financial crash. There’s a big difference in today’s market compared to 2005 to 2007 when there were lots of new projects and we had a lot of wolves in sheep’s clothing. There were more investors and flippers then.”
Today’s market, according to Zahn “is more rational with buyers doing their due diligence. High and ultra-high net worth buyers are not glib today. They are all about costs and how a deal works. We have evolved into a very dynamic luxury market with the infrastructure, service, and amenities to support that demographic.”
Zahn’s market report covers the fourth quarter of 2018 and a year-end comparison. Note the numbers only include closed transactions and not pre-construction sales or pending transactions. Some key numbers are the total sales of single-family homes. That 2018 year-end number was $123,032,496 compared to $111,673,706 at year-end 2017.
Ian Hurdle, managing partner of The Agency’s Turks and Caicos office, came to Providenciales in 1998. “Turks and Caicos is a brand itself and the number one buy in the Caribbean today. It’s a low-density island with well-planned luxury development that has learned from mistakes of other islands.” Hurdle confirms “there are lots of new luxury projects including low-density luxury villas and high-end resorts coming online.” The growth of VRBO and Airbnb has helped fueled sales. “Buyers see they can net a 6-12% return on investment annually through renting their properties. Showing them, they can get expenses covered and possibly get some extra income makes the sales process easier.” Beautiful beaches and perfect weather help too.