Issue 3, May 2009
Punta Perla aims to finish construction of the first phase of the project within 24 months.
The architects responsible for overseeing the construction of the tourist complex Punta Perla Caribbean Golf Marina & Spa Resort said that the work will be carried out at full speed because the goal is to complete the first phase in 24 months.
Architects Esteban Becerril and Ramon Ramirez, from B + R Arquitectos Asociados, who are part of the team of engineers and architects in charge of the works, explained that this section of the project has an estimated investment of 400 million dollars and will develop 2 million square meters and 1200 residential units will be built.
Becerril said the complex will occupy a surface of 10 million square meters with 3.5 kilometers of coastline filled with coconut trees and it has been planned to build 8.500 villas and apartments in its different stages.
The architect showed reporters the location of the various infrastructures that have already begun and said that to meet the goal of delivering the work "all technical and economic requirements have been provided." The complete development is scheduled for a period of 10 to 12 years with an estimated investment of U.S. $2,500 million in infrastructure, housing and commercial buildings.
Moreover, a marina will be built in an artificial inland lake with access to open sea through a channel in which three vessels will be able to navigate simultaneously. It will hold 1.200 moorings and provide capacity for large yachts and sailboats; it will also feature inner islands. The first golf course is a creation by Colin Montgomerie Design for which European Golf Design has been contracted as the development firm. This area will also have the first of four luxury boutique hotels with 180 suites of 180 square meters each, for people of high-level lifestyle.
Access roads
Current construction works include mainly access roads to the project and camp for employees. They will also include the first residential units located in the place where the beach club will be, and that will serve as models to show the real estate product to be offered in the complex.
Punta Perla has been designed to be "100% environmental-friendly" and due to this type of design, the complex won the "Bentley Awards 2006” as the best in environmental design and four design medals in the International Property Awards in 2007 as "Best Caribbean Development", "Best Property Caribbean”, “Best Marina Development Caribbean", "Best International Marina Development". Some of the companies involved in building are: B + R Arquitectos Asociados, Ozoria y Asociados construction, Nanita Lembert Engineering, electricity is the responsibility of MAIE and sanitary engineering from AYA.
IAGTO Awards 2009
The Dominican Republic received in Andalusia the award that distinguishes it as the “Golf Destination 2009 of Latin America and the Caribbean”, after being nominated as finalist in the IAGTO Awards 2009 by the International Association of Golf Tour Operators.
This is the first time that the country receives an award in the golf sector, which reflects the development and growth of the tourism industry towards high-level lifestyle. The other finalist destinations were Brazil, Costa Rica and Jamaica, which were pre-selected from a total of 12 candidates.
The International Association of Golf Tour Operators (IAGTO) is an organization that brings together representatives of the global golf tourism industry. It has a total of 1,130 corporate members in 77 nations, including 323 specialized tour operators that control over 80 per cent of the vacation supply in this niche of market, whose annual sales exceed 1.5 billion dollars.
The Tour operators specializing in the golf segment decided to grant the Dominican Republic the first prize as Golf Destination in the Caribbean and Latin America during the Golf Travel Market International Fair in Marbella.
Francisco Javier García, secretary of Tourism, accompanied by a large delegation, travelled to the Andalusian city to accept the award.
CONFOTUR
The Consejo de Fomento Turístico (Confotur) met at its headquarters in the Secretaría de Estado de Turismo of the Dominican Republic on October 9, 2008, in an assembly made up of eight members representing the highest level of the various governmental entities within the tourism sector.
In this assembly they granted to the Punta Perla Caribbean Golf, Marina and Spa Resort project, through the Resolution number 104/2008, the Definitive Classification in accordance with the law number 158-01 of October 9, 2001 and its subsequent amendments.
Resolution
Thanks to this resolution, the project benefits from the exemption of the payment of 100 % of:
- Income tax
- National and municipal taxes, for capital increase of already constituted companies.
- National and municipal taxes for transfer of Real Estate Rights for sales, exchanges, contributions and any other form of transfer on real estate rights.
- Taxes on luxury housing and undeveloped plots (IVSS).
- Fees, rights and quotas for the preparation of plans, studies, consultancies, supervision and the construction of the works to be executed in the project, being the latter exemption applicable to the contractors in charge of the execution of the works.
- Import and other taxes such as fees, rights and surcharges, including the tax on the transfer of industrialized goods and services (ITBIS) that are applicable to machinery, equipment, materials and goods necessary for the preparation of the space rented, primary equipment and starting up of the same, as well as to achieving a high standard of quality in the products it offers.
- Taxes on domestic and international financings, or the interests of those granted to companies that are subject to these incentives.
* Everything listed in this paragraph is taken from a copy of Resolution number 104/2008. The original is available for consultation at our offices upon request.
Delays
According to the article published in the 4.886 issue of the official magazine of the Secretaría de Estado de Turismo, dated November 25, 2008, it is clearly established how “the former administration was questioned for promoting some kind of block of projects, caused by the long period in which meetings of the CONFOTUR were not convened and for the large number of projects that were deliberately paralyzed for long periods, even of over a year”, one of them unfortunately being Punta Perla. Our project was stalled for a period of 2 years and 6 months from the date on which the first application for provisional classification was submitted before the former administration of the Secretaría de Estado de Turismo.
This was also the situation, for instance, for some of the new phases of Cap Cana and Angsana. The latter is a luxury five-star project, to be built in the Bay of Samaná.
As well as the aforementioned projects, many other large projects were affected, despite the fact that these investments would bring benefits to the Dominican Republic (tourist transit, construction job creation, generation of long-term employment…)
The significance of the obstacle presented by the former head of the Secretaría de Estado de Turismo was so transcendent that after the change of government in mid-2008, a large number of media began to analyze and discuss the bureaucracy of the former administration of Tourism.
Based on these discussions, Mr. Manuel Quiterio Cedeño, recently re-elected as president of the Dominican Association of Tourist Journalism (Adompretur), which has been representing tourism journalists for the past 31 years, published an article dated October 10, 2008, in the Opinion section of the El Caribe newspaper (page 22), which expressed the following conclusions:
“The Secretaría de Turismo has decided to remove the block that had become a formidable obstacle to investment in this sector, and which irresponsibly stopped the entry into the country of thousands of millions of dollars in the last three years.
For the first time, the Consejo de Fomento Turístico (Confotur) has held working sessions in two consecutive weeks, and will hold a third one the last week of October (...)
“We are seeing files received during 2006, 2007 and before August 2008. There are delays due to developers presenting incomplete files, lack of meeting of law requirements or the delaying tactics of the “experts” of the Secretaría de Medio Ambiente, but the main delay was responsibility of the former authorities in the Secretaría de Turismo, who used the block as a means to punish dissidents or to favor friends.”
Lastly, it should be noted that the Mirador magazine, dedicated exclusively to tourist information, published in its issue number 9 dated December 2008 (page 6), that should the former administration “not have stopped the course of these projects, most of them would be underway and many of them in very advanced stages with the consequent revitalizing effect on the economy."
Mr. Manuel Quiterio Cedeño
He is a Dominican veteran journalist with 36 years of experience. An expert in the tourist industry, he founded RESUMEN TURISMO (Tourism Summary) in 1988, the first daily service of tourist information online in the region of Las Americas, which under his leadership won the award of the
Caribbean Hotel Association, 1996, and the Premio Nacional de Periodismo Turístico (National Prize for Tourist Journalism) 2008. He won the 1993 Journalist of Tourism Award, president of the Dominican Association of Tourist Newspapers in five terms, a position he still holds. Mr. Quiterio Cedeño is an adviser to the National Association of Hotels and Restaurants, the Asociación de Hoteles del Este (Eastern Hotels Association) and The Hotels Association La Romana-Bayahibe. He is Mr. manuel Quiterio Cedeño also a professor at the Universidad Autónoma de Santo Domingo University, and founding member of the Foro Iberoamericano sobre Estrategias de Comunicación (Latin American Forum of Communication Strategies), based in Madrid. He is an adviser to the Pastoral of Tourism of the Latin American Episcopal Council (CELAM). He was honored in 2003 with the Medal for Distinguished Services as a Citizen, awarded by the President of the Republic. He was secretary general of the National Union of Professional Journalists (1975-76) and founder of the Dominican Association of Journalists.
Compensation
The First Paragraph of the Fifth Article of the Promissory Contract for Sale states that investors will be entitled to a compensation for delays in the completion of the property.
However, as explained in this Newsletter in the paragraph entitled “Delays”, the Developer has no contractual obligation to compensate investors in the current situation, since all delays were due to events of force majeure.
Force Majeur Clause
In accordance with the Fifth Article of the Contract, the Developer would finish construction of the property, as well as the club services and facilities, in a period of 30 months from the date of signing of the Contract, except in the event of force majeure.
Regardless of the willingness of the Developer to comply with contractual obligations, throughout the process, they have encountered inconveniences beyond their control which have made delivery of the property impossible, referring exclusively to the delay and obstacles presented by the former head of the Secretaría de Turismo of the Dominican Republic (SECTUR), for a period of 2 years and 6 months, in the granting of the permits required by Dominican Law to carry out the construction of tourist projects.
Without this permits, the Developer was legally unable to proceed with the construction works of the project in question, being, during that period, bound by a situation beyond its will and control, which constitutes a case of force majeure, which, in light of the Contract, results in a clear exception in regards to the penalties for late delivery of the property outside of the planned timeframe.
Definition of Force Majeure
By definition, a force majeure is a legal fact that prevents the compliance or fulfillment of an obligation, due to the absolute impossibility in which the responsible party of such obligation has found himself unable to overcome the power of the event that constitutes such legal fact.
In fact, Article 1148 of the Civil Code of the Dominican Republic states that: “There is no right to damages when as a consequence of force majeure or in fortuitous cases, the responsible party was unable to do or give that which he is obliged to do, or has done that which was prohibited”.
In other words, the fact that the Developer was bound by the force majeure that constituted the lack of the concession of the corresponding permits by SECTUR for a period of 2 years and 6 months, means the liberation of responsibility in favor of the Developer for the non-fulfillment of the obligation to deliver the property provided for in the aforementioned Fifth Article of the Contract.
CONFOTUR
It should be mentioned that, following their meeting on October 9, 2008 (see Page 5 of this Newsletter), the aforementioned permits required from SECTUR were granted on November 12th, 2008, which is the date that constitutes the starting point of the construction works of the Project.
For which, we let you know that the delivery of the property will take place within a period of 30 months counting from the date indicated above.
Visits to the Site
Investors, agents and collaborators will be able to visit the site on the second and Fourth Friday of every month.
In order to coordinate a visit, please contact the Investor Relations Department with at least three week’s notice.
Investor Relations Department
This Department is the only reliable source of information regarding the PP project.
We urge you to be wary of any info you receive from any other party (either agents, lawyers, other investors…)
Effective immediately, the IRD will be sending out periodic Newsletters updating all official announcements and addressing enquiries regarding the PP project.
To investors and commercial agents, we thank you all in advance for your patience, and we know how important it is that everyone be informed about new developments in a timely manner.
