‘High-end real estate busiest I’ve seen it’

• $40m project’s construction to start in two weeks

• Developer: No impact, but prices, supply ‘a concern’

• Reiterates call for faster permanent residency process

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A Bahamian developer yesterday said “the high end real estate market is the busiest I have ever seen it” as he prepares to break ground on a $40m project within the next two weeks.

Jason Kinsale, Aristo Development’s principal, told Tribune Business more than 30 percent of the units in his 11-storey Aqualina development have already been pre-sold as market demand for Bahamian real estate valued between $1m-$10m continues to soar amid the post-COVID surge.

Disclosing that there is “nothing left” in the $4m price bracket in high-end communities such as Lyford Cay and Old Fort Bay, he voiced optimism that the recent hike in construction material prices - coupled with supply chain bottlenecks - will not impede Aqualina’s progress as it has done other projects such as Sandals Royal Bahamian’s $37m upgrades.

“Obviously it’s a concern for all of us,” Mr Kinsale told this newspaper of the construction materials situation. “I was up in Toronto recently, and from what I was seeing up there, there was a lot of price gouging on concrete and steel.

“I understand there was a cement shortage here as well but, as these things start to calm down in the US and Canada, hopefully over the next six months, then we will start to get back to some semblance of normalcy. My understanding is that it’s not a long-term problem.”

Aqualina is presently mobilising its contractors and construction workforce to start installing its foundation, and related pilings, within the next two weeks and Mr Kinsale said the project had yet to feel the supply chain shortages and price hikes that have impacted others.

“We had to order some steel and didn’t have any issues,” he added. “We have always looked at a two-week lead time, and were still able to buy in that period. Plywood has increased substantially, but we don’t have one sheet of plywood in the project. It’s mostly concrete.

“I believe this is hurting the middle market, especially the $500,000 condominium, as you can’t increase prices to offset costs. The buyers don’t have the budget. It’s having an impact on everybody, but some are able to weather the storm better than others. We’re hoping that by the time we’re ready for major materials construction costs will have come down by then.”

Mr Kinsale said Aqualina has pre-sold ten of its high-end condos to existing buyers, with units ranging in price from $2.6m up to a peak of $11m for the penthouse residence. “Considering that we’ve not broken ground and just got the project started, we’re pretty happy with that,” he added. “It wasn’t something we really expected. It makes you realise there’s a lot of money out there.

“I think that the high-end real estate market without a doubt is the busiest I have ever seen it. If you try and find anything in Old Fort Bay, Lyford Cay, in the $4m range, nothing is left. Everything is getting into the $5m-$6m range. Every day I’m getting e-mails saying ‘sold’, ‘full’, and ‘nothing available’. It’s all the high-end communities.”

Defining the high-end market as between $1m-$10m, Mr Kinsale disclosed that The Bahamas was attracting American real estate purchasers in numbers “we’ve never really seen before” because the benefits of permanent residency were more than offset by the global reach of the US tax system.

He added that this interest was “being driven by lifestyle decisions” in the aftermath of COVID-19, as persons with wealth and means sought to escape colder home climates and pandemic lockdowns/health restrictions via properties in other countries.

“I didn’t really understand it until I was up in Toronto and sitting there for six weeks,” Mr Kinsale told Tribune Business. “You’re sitting in the house; you’re cold and bored, with nothing to do. People with money don’t like to be locked up and told what to do. “I said: ‘I understand why they’re coming to The Bahamas and other parts of the world.”

Aqualina will employ around 175 workers at the construction peak, with units starting at 2,6900 square feet for a three-bedroom. “The developments that have done well historically, Bayroc, Albany and Caves, all had larger condo units in their development,” the Aristo chief explained.

“We don’t try and fool ourselves into believing there’s unlimited demand, and we’ve learned over the years to be conservative in our forecasting. If we can, we’d like to sell one unit a month, but if it sells out sooner then great.”

Mr Kinsale, though, said he had yet to see any improvement in the pace at which economic permanent residency applications are processed on behalf of high-end expatriate buyers. “It’s very frustrating, and it’s something that in my opinion is a major revenue source for the country,” he added.

“I’ve said it before and sound like a broken record, but if we make it easy and people tell their friends and family they got permanent residency in a month, it will attract more persons to come here. Affluent people hang out with affluent people. We need to expedite those quickly.

“I don’t understand why it has to go through Cabinet approvals. It boggles my mind. Make them easy. It’s not that hard, especially if we have financial concerns and need money. Fifteen thousand dollars for an economic permanent residency application can add up pretty quickly, and I’m sure there’s plenty of them out there,” Mr Kinsale said.

“I’ve seen the kind of growth they’re having in Toronto, and it’s all driven by Immigration - responsible Immigration. That’s something we should really be pushing.”

Comments

KapunkleUp says...

I say it again, make residency dependent on a minimum amount of time foreigners have to stay in the country. Raising the minimum purchase amounts do nothing but make money for developers and agents. You want residency... you gotta stay a minimum of 180 days in country.

Posted 7 July 2021, 3:31 p.m. Suggest removal

Proguing says...

Hmmm what about the 12% tax on purchase and the annual property tax. That also makes money for the Treasury.

Posted 7 July 2021, 3:55 p.m. Suggest removal

KapunkleUp says...

True but the tax on purchase is a one time deal. As for yearly property tax... it goes into the treasury... then it gets "processed and tiefed". Much better for people to have to stay for a longer time and spend their money in stores, restaurants, etc... This way the money goes to where it needs to go - YOU and ME.

Posted 7 July 2021, 4:21 p.m. Suggest removal

Proguing says...

"People with money don’t like to be locked up and told what to do." I guess they have not heard about our lockdown PM...

Posted 7 July 2021, 4:03 p.m. Suggest removal

Dawes says...

Not in some of those gated communities out west, they kept on going like nothing had happened.

Posted 8 July 2021, 9:09 a.m. Suggest removal

mandela says...

Well the Bahamas for sale, and I can bet the wealthy are just snapping up the properties, by the time (15 to 20 years) an honest young person achieves enough money to be able to purchase any plot of land on New providence they will all be gone and perhaps still out of their reach.

Posted 7 July 2021, 4:08 p.m. Suggest removal

Emilio26 says...

Mandela actually the majority of the high-end real estate developments are in areas like out west that are really expensive.

Posted 12 July 2021, 4:26 a.m. Suggest removal

TalRussell says...

Let's start with what's lawful? Yes, it's lawful for a developer to assume a **Spin Doc's** role...Why even the now **booted** from a job,** the Donald will be returning to the **more suitable** role of acting as his own developer's Spin doc **aka** John Miller...yes, that's a fact!
Already off good start be associating new development's name with those names the two other projects.
Anyone care to recommend a good new John Miller, substitute name, yes?

Posted 7 July 2021, 4:36 p.m. Suggest removal

GodSpeed says...

All the rich Americans fleeing Biden's America.

Posted 7 July 2021, 4:37 p.m. Suggest removal

Proguing says...

and all the poor Mexicans are flooding the USA

Posted 8 July 2021, 10:52 a.m. Suggest removal

tribanon says...

Sounds much like all the rich Bahamians fleeing Minnis's Bahamas and all of the poor Haitians flooding (invading) The Bahamas.

Posted 8 July 2021, 10:57 a.m. Suggest removal

realitycheck242 says...

Developers like Mr Kinsale are up scale. They only develope for the rich and powerfull. What Nassau needs now is developer's who can compete with Arawak homes now that the present administration is only selling lots and not in the bussiness of building houses. Who is looking out for the average Bahamian, the small man, and future generations of our many young people.when it comes to affordable housing. The Bahamas needs developers who can buy up the many abandoned houses that are situated in many of the subdivisions across new providence,many of them are bank reoposessed , renovate or demolish the structures and build new affordable homes for the average young person.just starting out.

Posted 7 July 2021, 5:09 p.m. Suggest removal

DWW says...

why you ask? because the 10% tax to buy it and then sell it after fixing it up means you actually lose money doing it. simple math mate.

Posted 8 July 2021, 7:58 a.m. Suggest removal

Dawes says...

And the 6% commission to the real estate agent and 2% to the lawyer. No point buying here as all 3 shaft you.,

Posted 8 July 2021, 9:10 a.m. Suggest removal

WETHEPEOPLE says...

Sorry, nobody cares for the small man

Posted 7 July 2021, 5:41 p.m. Suggest removal

realitycheck242 says...

It this trend continues. Bahamians will be replaced as the majority population because of gentrification. New providence will be too upscale for many of us to afford to live on.

Posted 7 July 2021, 5:47 p.m. Suggest removal

Emilio26 says...

Realitycheck242 actually a real estate developer told me once a while back that they're trying to make western New Providence like areas extending Cable Beach all the way out to Albany the next Beverly Hills.

Posted 8 July 2021, 4:39 p.m. Suggest removal

Emilio26 says...

WETHEPEOPLE.the reality is the small man cannot afford a piece of high-end real estate in western or eastern New Providence.

Posted 12 July 2021, 4:23 a.m. Suggest removal

Bonefishpete says...

"You want residency... you gotta stay a minimum of 180 days in country."
Isn't that kind of cruel?

Posted 7 July 2021, 6:48 p.m. Suggest removal

KapunkleUp says...

Why do you think that's cruel? Foreigners who want residency do it for one of two reasons: 1) They want to live here. 2) Tax purposes. People in group one would have no problem with spending at least 180 days a year here as they would be living here. Group 2, well if they want income tax free benefits then they have to stay here for a while too and contribute to the economy.

Posted 7 July 2021, 9:51 p.m. Suggest removal

DWW says...

what are you implying? The Bahamas is hands down no argument the #1 100% best place to be in the world. silly comment there. fishedoutpete

Posted 8 July 2021, 8 a.m. Suggest removal

tribanon says...

I can only assume you've travelled to a very limited number of other countries. lol

Posted 8 July 2021, 6:55 p.m. Suggest removal

John says...

Erryone looking for a safe haven. But you can’t run from God and your judgment! Mystery Babylon is being revealed.. Come out of her, my people.

Posted 7 July 2021, 9:48 p.m. Suggest removal

KapunkleUp says...

But I can, and do, run from my mother-in-law.

Posted 7 July 2021, 9:54 p.m. Suggest removal

DWW says...

do you know the one about Jesus in the temple and the false prophets? is that you?

Posted 8 July 2021, 8:01 a.m. Suggest removal

ThisIsOurs says...

and the poor have never been so poor

Posted 8 July 2021, 9:51 p.m. Suggest removal

tribanon says...

...nor so persecuted by their elected officials.

Posted 9 July 2021, 10:56 a.m. Suggest removal

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