Private equity investment (PEI) is fueling a new wave of development in the Caribbean’s hospitality industry, creating exciting opportunities for investors and entrepreneurs alike. With its thriving tourism sector, the Caribbean continues to attract international firms seeking to invest in luxury hotel projects. A prime example of this is Rosewood Hotels & Resorts’ recent announcement of a 124-acre project in Exuma, in partnership with Miami-based Yntegra Group. Companies like LionGrove, Driftwood Capital, and London & Regional are also making their presence felt, further signaling the region’s potential.
The acquisition of the 486-room Frenchman’s Reef Resort in St. Thomas by Fortress Investment Group highlights the region’s attractiveness to private equity investors. This transaction is part of a broader trend of private equity focusing on high-profile, large-scale investments that promise significant returns.
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Private equity investments in the Caribbean hospitality sector are growing, but they are not the sole avenue for capital flow. According to Michael Register, co-founder of Trust Hospitality, high-net-worth individuals and family offices remain dominant players. Trust Hospitality recently partnered with Hotel Equities to expand their operations across the Caribbean and Latin American markets (CALA)​. Register highlights that private equity investors tend to focus on trophy assets, where the potential for value creation over five to seven years is high, while family offices and individual investors take a longer-term view.
Beyond high-end resort developments, boutique hotels are also gaining traction, especially through localized private equity initiatives. Vivant Capital, based in Puerto Rico, is leading the charge with its investment in the Plaza Colón Hotel & Suites in San Juan and a luxury beachfront hotel in Rincón. This move underscores the importance of local expertise in making smart investments. Eric Berman, Vivant Capital’s managing director, notes that navigating the Caribbean hospitality market requires in-depth knowledge of local tax incentives, market trends, and regulations​.​
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A key driver of this growth is strategic partnerships. The collaboration between Trust Hospitality and Hotel Equities exemplifies how partnerships can leverage regional expertise to unlock new opportunities. By combining Trust Hospitality’s local knowledge with Hotel Equities’ operational prowess, both companies are poised to accelerate their growth in the Caribbean. Brad Rahinsky, CEO of Hotel Equities, emphasized the importance of this partnership in driving value for hotel owners across the region​.
A Promising Future for Private Equity in the Caribbean
Looking ahead, the Caribbean is ripe for even more private equity investments, especially as global interest rates show signs of decreasing. This shift in macroeconomic conditions could further encourage private equity firms to invest in the region’s booming hospitality sector, particularly in luxury and large-scale developments. With its strong tourism industry, favorable market conditions, and growing interest from international investors, the Caribbean presents a wealth of opportunities for those looking to tap into this vibrant market​.​
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