The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A leading real estate firm’s typical 10 per cent year-over-year sales growth rate was halved in 2015, with its principal yesterday calling for the Bahamas to “make it easier” for foreign buyers to invest.

George Damianos, Damianos Sotheby’s International Realty’s president, told Tribune Business that the company was “thankful” for its 2015 growth, even though this was 50 per cent below historical rates.

Expressing confidence that Damianos Sotheby’s would either match or exceed last year’s performance in 2016, Mr Damianos said the Bahamas needed to upgrade the investment regime offered to international second home buyers and real estate investors.

He added that this nation had “held tight” to the incentives traditionally offered to international real estate buyers, even though rivals in the Caribbean and elsewhere had increased their competitiveness via citizenship and residency programmes linked to investment levels.

Arguing that the Bahamas was “missing the boat”, Mr Damianos said international buyers would spend on local goods and services, and help “take the load off” the country’s dependency on mega resort projects such as Baha Mar.

“We’re very optimistic about the foreign market, and hope it will hold up and treat us as well as it did in 2015,” Mr Damianos told Tribune Business,

“The Bahamas had a bit of a black eye over Baha Mar, but it’s still a great place for people come and make their second home or residency.”

Assessing Damianos Sotheby’s performance over the past year, Mr Damianos added: “We were up in 2015 over 2014. We weren’t up as much as we were in 2014 over 2013.

“Our sales increased by 5 per cent in 2015. Normally, we’ve been up 10 per cent year-over-year since 2005. But we were very thankful, as in general a lot of real estate companies and agents did find it tough.

“We said: ‘OK, we didn’t do as well as we’d like to have done, but we’ll be fine as we’re not losing money or moving backwards’.”

Mr Damianos said the company and its sales team expected “to work as hard or harder in 2016”, and were optimistic they can at least match last year’s sales volume rise despite the headwinds facing the international real estate market segment.

“We’re definitely going to match it or a bit more. That’s our ambition,” he told Tribune Business. “We’re definitely in the mindset of pushing the envelope and driving our business to make it a bit bigger.

“We plan to push really hard this year. I’m really optimistic that we can be in there, in the game, and scoring goals.”

The strengthening US dollar, though, has hit both the Canadian and European markets as a source of Bahamian real estate buyers.

With the Bahamian dollar pegged to its US counterpart, the Canadian dollar and Euro’s weakness against the latter has resulted in this nation’s real estate becoming more expensive for buyers from those two areas.

“It’s now very expensive for Canadian buyers, and it’s also going to affect Florida, because a lot of Canadian ‘snowbirds’ buy in Florida, and the east and west US,” Mr Damianos said.

To counter this, and boost the Bahamian economy at the same time, the Damianos Sotheby’s chief called on this nation to improve the investment incentives and ‘reception’ for bona fide international real estate buyers.

“The Bahamas Government could do a little bit better in attracting some second and third home buyers,” Mr Damianos told Tribune Business. “They need to focus a little bit more on these people and make it easier for them to come here; just a little bit of help, and a little more encouragement.”

He added that the Bahamas possessed many of the attributes necessary to attract international real estate buyers, such as its location, climate and tax structure, but suggested that the enabling incentive and approval process needed to be more friendly.

“There’s lots of competition out there, with lots of people offering residency for investment dollars, citizenship for investment,” Mr Damianos said.

“We’re still holding tight to the programmes we’ve had in effect for the last 10 years. We’re not being innovative at all to encourage people to move in and set up shop, buy a car from Nassau Motor Company (NMC) and buy a fridge and washer.

“A lot of money can be put into circulation by getting these second home buyers here, giving them residency and moving them along. We continue to miss the boat,” he added.

“If we roll up our sleeves, get smart, put the pieces of the puzzle together, it would be a great help to the economy of the Bahamas and will take some of the load off depending on Baha Mar and one or two other projects at a time.”

So-called ‘Investor Citizenship’ programmes have been mulled and floated in the past, most recently by Sean McWeeney, the former attorney general and key adviser to Prime Minister Perry Christie.

Such an initiative would eventually grant citizenship to a limited group of individuals, once they met certain criteria, including a high multi-million dollar investment threshold.

Those qualifying for such a programme would essentially have to invest in Bahamas-based developments and companies that created local jobs, but Mr McWeeney’s proposal drew a mixed reaction from the Bahamian private sector in mid-2014.

Mr Damianos, meanwhile, said Bahamian real estate could also act as ‘a hedge’ for foreign investors against the current stock market volatility and ongoing political turbulence in areas such as Europe.