Dart group’s planned development activities on Grand Cayman in the next 10 to 15 years extend across the island in myriad ways.
In the 20 years since Kenneth Dart bought the land that has become Camana Bay, Dart Realty (Cayman) Ltd. and its associated companies have also been involved in many other real estate and development activities on Grand Cayman.
Camana Bay, already impressive with some 600,000 square feet of residential, office, retail and other built-out space, is now poised for an extensive US$1.3 billion expansion over the next 10 to 15 years. However, that isn’t the extent of the Dart group’s planned development activities on Grand Cayman in that time frame.
Dart Realty CEO Mark VanDevelde spoke about some of the development plans and possibilities, starting with the company’s extensive land holdings on the northern part of the Seven Mile Beach corridor.
Those lands include the 300-plus acres Dart bought from developer Stan Thomas in 2011, of which the Courtyard Marriott hotel was a part. That hotel was eventually demolished and Dart is now building a new one – the 263-room Kimpton hotel, along with 56 for-sale condominiums – which is scheduled for a late-2016 opening.
VanDevelde calls the lands acquired in the northern Seven Mile Beach corridor the “690 lands” because that’s roughly how many acres Dart has amassed in the area.
“When you factor it all, it’s a little bit more than that, but at some time someone calculated 690 and the name stuck,” he said.
In addition to the Kimpton property, the “690” lands include 50 acres north and south of the Kimpton along Seven Mile Beach, the Cayman Islands Yacht Club, the Salt Creek subdivision and large chunks of undeveloped land abutting the North Sound. More recently, Dart also acquired the North Sound Golf Club and part of the proposed Dragon Bay subdivision just north of The Ritz-Carlton, Grand Cayman.
Although the Dart Group hasn’t decided what it will do with most of the “690” and Dragon Bay lands, there will be some development in the near future on some of it.
Dart Realty’s first for-sale land development was Salt Creek, just north of Vista del Mar and the Cayman Islands Yacht Club in the northern Seven Mile Beach corridor. All but one of the original 23 Salt Creek lots have been sold and VanDevelde said there’s a Phase 2 coming.
“I think in the near term we’ll be looking at a second phase of Salt Creek… in keeping with the first phase, just around the other side of the basin,” he said. “So I think we well be coming to market with some similar, higher-end residential lots in that area.”
In addition, VanDevelde said Dart would continue to enhance the Cayman Islands Yacht Club property, beyond what they’ve already done over the past couple of years, and introduce some for-sale residential lots there as well.
With regard to the Dragon Bay lands that were purchased from the Mike Ryan-led company and include the North Sound Golf Club, Premier Alden McLaughlin announced in February that government had agreed to sell the freehold title to that land, which is currently held through a long-term lease.
The conversion to freehold was part of the renegotiated National Roads Authority agreement that allowed Dart to close a section of West Bay Road north of Public Beach while Dart paid for the extension of the Esterley Tibbetts Highway from Raleigh Quay in Governor’s Harbour to Batabano Road in West Bay.
The sale is contingent on the two sides agreeing to a fair market value, which VanDevelde said would be based on valuations that were being done separately by the government and Dart.
“My hope is [the valuations] are going to come in very similar to one another, so we’ll have a pretty tight range of what free market value is on that,” he said, adding that once the price is established and the deal is finalized, there is great potential for unleashing economic activity through development of those lands.
Dart has already invested in making improvements at the North Sound Golf Club and more improvements are on the way. In addition, residential development around the golf course is planned, based on market demand, VanDevelde said.
“I think we want to continue to expand the quality of the golf,” he said of the North Sound Golf Club, adding that Dart is currently looking at an alternative location for the clubhouse, perhaps closer to the road, with some additional amenities.
The Dart group’s involvement in golf will likely extend beyond improvements at the North Sound Golf Club.
VanDevelde said there have been discussions with the Britannia Golf Club about a joint venture to create another 18-hole golf course on Grand Cayman, with Britannia’s existing nine holes being added to a course built on the northern part of the Camana Bay lands.
“It’s easier said than done in terms of building a new nine holes and coupling that with an old nine holes,” he said, noting that the Britannia course was originally designed as an executive/short course and that adding a regulation nine holes to that course would essentially force together two courses with different characteristics.
“I don’t golf, but those who golf say you’ve got a complete mismatch there,” he said, noting that one possible solution would be to redesign the Britannia course with fewer, but longer, holes and then add it to perhaps 11 new holes at Camana Bay to create a regulation 18-hole course.
From the Camana Bay side, the course would be situated mainly on the “Limestone” property abutting the Britannia course to the south that Dart bought in 2006, but could also be “feathered into Camana Bay further,” VanDevelde said.
“We have not come to any agreement with them on any aspect of joint venture or otherwise, but we’re continuing to be open-minded to that because I think there are some benefits to Camana Bay and vice versa for them.”
VanDevelde believes it would be good for Grand Cayman to have two or even three 18-hole golf courses and that there’s a possibility Dart would build a new championship course on the “690” lands.
“If we have some element of control or involvement in each of [potentially three golf courses], the ability to be able to sell memberships across a platform of three golf courses locally, or for visitors coming down… could be pretty powerful.”
As part of the National Roads Authority agreement, the Dart group completed the Esterley Tibbetts Highway extension to West Bay in September 2013, but it will likely have involvement in other government infrastructure projects as well.
In December, Dart announced a proposed plan to relocate and widen to four lanes the section of the Esterley Tibbetts Highway that goes through the Camana Bay property between the roundabout at Lawrence Thompson Boulevard and the roundabout near the Galleria shopping plaza. The project, which Dart would undertake at its own expense and take 12 months to complete, entails creating an underpass over which Dart would extend the Camana Bay Town Centre, creating what VanDevelde calls “Resort Village.”
The proposed plan also calls for the section of West Bay Road that abuts the Camana Bay property to traverse under the Resort Village, and specifically beneath part of the five-star hotel and residences that Dart plans to build and open in 2019. The proposals have been discussed and agreed in principle with the elected government and various relevant agencies, but are subject to the necessary formal applications and approvals, VanDevelde said.
The widening of the section of the Esterley Tibbetts Highway through Camana Bay will help alleviate traffic problems, but the bottleneck to its south will remain because the road from the roundabout at Lawrence Thompson Boulevard to the Butterfield roundabout will still have only two lanes. VanDevelde said Dart is discussing with government the possibility of getting involved in expanding that section of the Esterley Tibbetts Highway to four lanes as well.
“It’s arguably one of the highest trafficked roads on the island, albeit a relatively small stretch,” he said, adding that because it serves as the feeder road from the airport to the Seven Mile Beach corridor, it has an impact on Camana Bay and all other properties all along the corridor.
“I think one of the biggest issues is it’s probably one of the most unsafe roads on the island, being… relatively high-speed, straight and undivided,” he said. “We understand that it [would cost] about $10 million, plus or minus, to complete the four-lane road, and that would probably be a bare bones four lanes with a divider.”
VanDevelde said the new airport connector road – which the government has already gazetted – is planned to intersect that portion of the Esterley Tibbetts Highway at a new roundabout.
“We have spoken to government about building that roundabout, even as a precursor to the airport connector road,” he said. “What it facilitates is the access to the west. We’re working… to develop an 11-acre site for the rugby club just west of [the Esterley Tibbetts Highway], so it will be kind of across from the landfill, south of the National Gallery, and it will possibly include some other sports facilities that… may include another soccer pitch, maybe some five-a-side [football] courts, etc.”
Having those amenities west of the Esterley Tibbetts Highway without a feeder road connecting to a new roundabout would create more situations similar to that of the National Gallery site, where motorists can only turn left into the parking lot and then have to turn left when they leave, something VanDevelde said is “unsafe and not very efficient.”
“So having a roundabout there that would feed everything to the west is very important,” he said. “We have had discussions with government. We would love to see it done.”
VanDevelde said that he didn’t think government would have the $10 million in its near-term budget to construct the roundabout and expand that section of the Esterley Tibbetts Highway to a four-lane divided road, but there are some ways Dart could recover the expenditure if it were to partner with government on the project. He said government has expressed openness to discuss the possibilities.
“They really want us to do it, or want it to get done, so it’s their approach,” he said. “We certainly see it as a benefit [for] safety and traffic-related issues, and it kind of completes a major part of that corridor and… puts that to bed for decades.”
Another infrastructure project that Dart – along with other major hotels in Cayman – would be willing to partner on involves the Owen Roberts International Airport redevelopment project, VanDevelde said, adding that in a recent meeting with representatives of Five Mile Capital, the owners of The Ritz-Carlton, Grand Cayman, they discussed a joint venture to expand the runway, which is not part of the first phase of the airport redevelopment.
“As a group, the hoteliers and those in the industry would like to see [the runway expansion] more quickly and not take a backseat to some of the other [redevelopment plans].”
The hoteliers and others in the tourism industry see a pressing need for the airport to be able to accommodate the larger, long-haul aircraft coming from Europe, VanDevelde said, noting that there’s a “chicken and egg element” to getting the runway expanded.
“It’s easy to say,‘well, we have no commitments, so why would we build it?’ but no one is going to give you a commitment if you don’t have the infrastructure. [The airlines] are looking two, three years out for scheduling and if you don’t have it, and nor can you commit to having it built, they’re not going to consider you,” he said.
VanDevelde thinks Cayman needs to be proactive on the matter and not give airlines the excuse that Cayman doesn’t have the infrastructure for not coming here.
“I think we feel fairly strongly that it would be money well spent,” he said, referring to the hoteliers. “[European direct flights] might take years to develop, but it’s something that you’d then have the tools to go and sell off of.”
Looking at the hundreds of millions of dollars that have been invested in Grand Cayman hotels in the past few years or that will be invested in Dart’s Kimpton and new five-star hotel over the next few years, and the kind of destination marketing that churns out of hotel networks, VanDevelde said Cayman absolutely needs to fix the airport as a priority. In addition to accelerating the already planned aspects of the airport redevelopment, Dart and others in the tourism industry feel that improvements also need to be made to the general aviation terminal and the fixed base operation.
“While the actual numbers of visitors who arrive by private jet might be relatively small compared to passengers on commercial flights, it is growing and expected to have strong growth for the foreseeable future. Private jet passengers represent the high net worth visitor, investor or business person. Our current aviation infrastructure for the private jet passenger is at least a decade overdue for an upgrade, both in functionality and in design, to provide a visitor experience on par with the rest of the island’s tourism product.”
However, he noted the funding issues on just what is planned in phase 1 of the project could drag the project out anywhere from three to five years.
“So that’s concerning,” he said. “You’re now in a five-year window as opposed to if you had the money today, how quickly could you get it done? Is it two years? Is it two-and-a-half years? Three years? At least, certainly, it’s going to be there in three years’ time.”
If the airport terminal project didn’t get completed for five years and it was only then that the runway expansion phase of the redevelopment or other improvements were considered, it could be a decade before Cayman gets an expanded runway, VanDevelde said.
“So that was the impetus for the discussion with us, Five Mile and others,” he said, adding that when he recently met with Five Mile representatives, the focus was on thinking about creative ways to develop a private-public partnership with government that could expedite the airport redevelopment for the betterment of the country.
“We have some interesting ideas, creative ideas – Five Mile with their background and us with our long-term commitment and the financial support that we can provide,” he said. “I think there are some things that would be worthwhile to speak to government about.”
George Town revitalization
Dart, which has significant land, building and business investments downtown, would also like to support the George Town revitalization project.
“We’ve had some conversations with government of late about this,” VanDevelde said. “We really want to be involved in what we can make out of George Town.”
However, VanDevelde feels strongly that George Town needs to be revitalized with an eye on the future instead of one on the past, especially if a cruise ship berthing facility is built there as planned.
“I think without a doubt it’s cruise tourism-centric,” he said, adding that it would be extremely difficult to change the nature of George Town from what it is now because of road, sewerage and parking-related infrastructure issues.
Instead of trying to make George Town the center of business again, VanDevelde is in favor of seeing the downtown area embrace cruise tourism, starting with the cruise berthing piers, and for opening it up to residential development again.
“I think [calls for] getting it to be the George Town of 30 years ago are misplaced and not the direction [to go],” he said. “You’d be forcing something that is not going to be successful, in my opinion.”
In addition to being involved from a funding or investment standpoint, Dart also supports government infrastructure projects by sharing knowledge, as it has on the George Town Landfill and the Water Treatment Plant, VanDevelde said, noting that they have discussed the latter with government on multiple occasions.
“We provided them our work product on that as well,” he said, delving into a common misconception about the odor coming from the George Town Landfill. “I think that there’s solid support to indicate in most instances where you have… significant odor emanating from the area, it’s coming from the water treatment facility, not the landfill.”
If Cayman is to grow in the near future, VanDevelde said it’s vital that there is sewage and solid waste infrastructure able to accommodate a greater number of people.
“Water treatment and waste management have to be priorities in terms of infrastructure necessary to support not only current population, but a growth in population.”
Not all of Dart’s real estate holdings on Grand Cayman will be developed, VanDevelde said, noting that Ken Dart loves nature and owns extensive land around the world that he holds with no intention of developing.
“Our broader organization has… literally hundreds and hundreds of thousands of acres in remote, pristine areas for conservation purposes,” he said, noting that Ken Dart uses some of the lands to pursue his mountain biking passion. “These are remote, absolutely gorgeous, fantastic places, not to be developed, just to be preserved for recreational use and [because] that they’re just pristine places.”
Dart holds a lot of land on Grand Cayman for conservation purposes.
“There’s a thousand-odd acres in the [Central Mangrove Wetland that] won’t be developed,” he said, adding that Dart has also quietly worked with the National Trust for the Cayman Islands to acquire other lands on their behalf or with them.
With no real structure to hold the lands Dart buys for conservation purposes, many people don’t know about it. However, VanDevelde acknowledges that if they did, it might help alleviate some of the concerns people have about the “big, bad developer… and what’s he going to do next.”
“We’ve been talking about maybe… [putting lands held for conservation globally] into a trust… and [putting] some of the lands locally into that same trust because the story is fantastic,” he said. “Truly, it’s hundreds and hundreds of thousands of acres around the globe in some pretty fantastic locations and people don’t know anything about that.”
Even at Camana Bay, VanDevelde said Ken Dart’s love of nature is evident. One of the reasons Dart is reluctant to allow his personal residence on the West Indian Club property to be used for part of the Resort Village is the emotional attachment he has for the garden he has created on the property.
“Ken loves his garden,” VanDevelde said. “He loves his trees and unfortunately there are a few trees there that would be very difficult to move without killing.”
Instead, the planning team at Dart Realty is trying to figure out ways of incorporating the garden into the plan for the grounds of the new five-star hotel as a way of talking Dart into giving up his personal home for the project.
“It could be an absolute fantastic amenity for lodging customers or residential customers,” he said. “So we are looking at [how] we could have a garden, maybe… configured a little differently, so that you could save some of the big feature trees, save parts of the garden and make it a really amazing amenity, whether it be for the broader public, Camana Bay lodging customers, or otherwise.”
Although developers often get accused of ruining the natural environment, VanDevelde said that sometimes they can develop in ways that are respectful to nature.
“If you look at Camana Bay, there’s no doubt [there’s] an impact on the environment… but if you look at what [has replaced the natural environment], there’s a big focus on landscaping and common areas, native or indigenous types of plants and materials. It’s different, it doesn’t necessarily make it worse, but it’s different.
And in some instances you’re changing unusable habitat… into usable, attractive habitat.