A glimpse of Cuba's future in resort north of Havana

Thu, Jun 18, 2009, 01:00

CUBA: FROM €93,000:A British resort company and the Cuban government are proposing to build a major holiday home development on the oceanfront in the country’s principal tourist resort

YOU LEARN a lot about modern Cuba by driving the scenic Via Blanca highway between Havana and the north coast resort of Varadero. My trip one late May afternoon starts on the wave-lashed Malecón, a 7km boulevard separating the capital – both its restored colonial quarter and its communist-designed tower blocks – from the Florida Straits.

Moving on from the sometimes dilapidated nearby suburbs into the outer ones, each junction is lined with workers and schoolchildren sweating in the 35ºC heat, trying to hitch-hike home to their villages.

Soon, the coast road changes from motorway to pot-holed track and back again, ensuring the 140km trip takes a full two hours. But it’s worth it: an occasional industrial plant, village or roadside bar, a few small oil wells, then mostly blue water on one side, lush green countryside and distant mountains on the other, and many fine, empty sandy beaches.

Entering Varadero, modernity immediately takes over. The beach is still beautiful though packed, and bougainvilleas line neatly manicured lawns; clear views give way to the clutter of hotels, restaurants, shopping malls and even a discotheque or two.

This is Cuba’s principal tourist resort and, perhaps more importantly, the place where developers expect to gain permission to build the first holiday homes in the country to be sold to foreigners for more than half a century.

If Havana is Cuba’s past, Varadero is a glimpse of its future and, with some observers anticipating a more open foreign policy from the Raul Castro government, it could serve as a template for other, similar areas to be built out in the next decade.

Under communist control since its 1959 revolution – when almost all private homes were seized and nationalised – Cuba has not kept pace with the rest of the world. The streets are full of old European cars of different vintages and dubious reliability with a few American classics here and there.

Finding a good restaurant is still a hit-and-miss exercise and shops are surprisingly hard to spot, even in many residential suburbs. But large numbers of children playing in the street and an absence of obesity are reminders that falling behind the times is not always a bad thing.

In real estate terms, Havana’s tourist-filled old town has been meticulously restored but that is juxtaposed with its bland tower blocks and, in the tree-lined suburbs of Vedado and Miramar, crumbling 19th and 20th-century architecture.

But change seems to be in the air. Some two million tourists, mostly Canadians, Britons and Spaniards, now visit Cuba each year, frequenting not only Varadero but also Trinidad, a Unesco World Heritage Site, and Sancti Spiritus, deep in the countryside.

Thanks to relaxed rules on imports, young locals now carry mobile telephones and watch plasma-screen televisions; hotels advertise with “Wi-fi here” signs; there are Benetton and Zara shops in Havana; and the occasional modern black Mercedes can be seen among the city’s Lada taxis.

Relations with the US are also improving, with recently relaxed travel restrictions for Cuban-Americans, early speculation that the trade embargo imposed back in 1961 will eventually be lifted and smaller signs of thaw, including news that the state television service will screen The Sopranos and Grey’s Anatomy this summer. (The US army also still has its much-publicised base at Guantánamo.)

Then there is the Carbonera Club, a 15-minute drive from central Varadero. A proposed collaboration between UK-based Esencia Hotels and Resorts and the Cuban government, the oceanfront resort is expected to include 800 villas and apartments, an 18-hole golf course, private and communal pools, a yacht club and restaurants, with residential sales kicking off as soon as the joint venture contract is signed. Savills, sole marketer of the development, says the agreement is in place and the announcement “imminent” although there have been unexplained delays.

“Carbonera will be an opportunity to buy not only a Caribbean holiday home but a slice of history,” says the company’s David Vaughan.

Prices will start at $129,000 (€93,000) for apartments near the back of the site and rise to $1.8m (€1.29m) for seafront villas – comparable to “middle market” prices on other Caribbean islands such as the Dominican Republic and well below those in prime destinations such as Barbados.

The properties will only be available for sale on a 75-year leasehold basis, however, and it’s unclear whether the authorities will allow them to become freehold. Questions also remain about whether deposits will be lodged in Cuba or the buyers’ own countries. And club membership, with a likely fee of $1,000 (€721), is mandatory, with the developer reserving the right to reject applicants who cannot prove their bona fides.

In spite of the uncertainty, Esencia insists Cuba is a compelling market. “Buyers will have so much more than elsewhere,” says Christopher Lawton, director of sales for the company, which is also working with the government on refurbishing some hotels in central Havana.

“The island is the size of England and has more culture than most other holiday-home destinations. There’s the beautiful coastline and countryside that you expect but also an existing infrastructure.”

The road network, though patchy, does criss-cross the island; the national rail network is one of few in the region; and there are 30 airports, nine of them entry points, along with a cruise-ship port at Varadero. The local population is skilled and educated, with a 99.8 per cent adult literacy rate, and surprisingly welcoming to newcomers, even those from the US.

“America may have a problem with us but we have no problems with Americans; the more who visit us, the better,” says Jose Tovar Pineda, director-general of Varadero’s golf course.

Many think his facility is a model that should be replicated in other parts of the country and Pineda says he wouldn’t be surprised if Cuba has 12 or more international-standard courses by 2018, each with hotels and possibly private residences, as called for in the Carbonera Club’s plans.

“What we don’t want is people to come to Cuba, sit on the beach, then go home after a week without having seen the country,” he says. “So our resorts will be at historic centres across the country. That way people get their suntan, enjoy our country and learn about the culture.”

Such ambitions would have seemed laughable five years ago and sceptics still argue that the Cuban government could turn inward once more and kill the Carbonera Club development at any time.

But optimists think it will be the first of many similar schemes – with Qatari and Canadian developers already waiting in the wings – at last breaching one of the final frontiers for private property.

  • 00 44 207 016 3740, www.savills.co.uk/abroad

Copyright The Financial Times Limited 2009