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Following the U.S. government’s recent ease of travel
restrictions and improved diplomatic relations with Cuba,
more than 40 percent of all Americans are now interested in traveling
there, according to a report from travel insurance provider, Allianz Global
Assistance. Cuba is already one of the largest tourismdestinations in the
Caribbean and is second only to the Dominican Republic in visitor arriv-
als. According to the Caribbean Hotel & Tourism Association, Cuba’s
hotel room total is approximately 62,000, with another 15,000 planned
for construction in the next two years.
New access to the “forbidden fruit” is attracting lots of attention.
Many tourists want to see Cuba before mass development changes
the Cuban character that has been protected for so long. And there are
those who want to be among the first to visit Cuba, with bragging rights
that compel other travelers to want to go there, too.
But is Cuba ready for timeshar-
ing, let alone a surge in tourism
from the U.S.? According to many
with a finger on the pulse of activity
in the Caribbean region, there may
be a ways to go.
Deals in the Making
Hotels, airlines, and cruise ship com-
panies in the U.S. are already planning
to be a part of a future business boom
for U.S. travelers in Cuba. “Some U.S.
hotel companies have started work-
ing out arrangements in principle with
Cuba in the past several months,”
says Vanessa Ledesma-Berrios, chief
operating officer for the Caribbean
Hotel & Tourism Association.
In March 2016, the U.S. government approved an application from
Marriott International to pursue joint-venture business deals in Cuba.
The company immediately began discussing opportunities with poten-
tial partners there.
Starwood Hotels & Resorts Worldwide also inked three hotel man-
agement deals in Cuba in March of this year, making it the first U.S.
hospitality company to enter the country’s market in almost 60 years.
This summer, the Four Points by Sheraton, formerly the Hotel Quinta
Avenida, opened in Havana. By the end of 2016, the Hotel Inglaterra in
Havana will join Starwood’s Luxury Collection, and Hotel Santa Isabel
is set to follow.
Several airlines are planning for round-trip flights from U.S. cities to
Cuban destinations before the end of 2016. In fact, JetBlue Flight 387,
originating from Fort Lauderdale, Florida, touched down in Santa Clara,
Cuba, on August 31 — the first U.S.–based scheduled commercial
flight to Cuba in more than 50 years. The Department of Transportation
has approved flights to Havana from 10 U.S. cities for eight airlines:
Alaska Airlines, American Airlines, Delta Air Lines, Frontier Airlines,
JetBlue, Southwest Airlines, Spirit Airlines, and United Airlines. Earlier
in the summer, the DOT approved flights to nine Cuban cities other than
Havana for American Airlines, Frontier Airlines, JetBlue, Silver Airways,
Southwest Airlines, and Sun Country Airlines.
Exploding Demand, Lack of Infrastructure
A survey by Allianz Global Assistance, conducted during President
Obama’s historic visit to Cuba this past spring, found that after the easing
of travel restrictions, 42 percent of those surveyed would like to travel to
the country. About 7 percent said they would be very likely to plan a trip
to Cuba, while 22 percent were somewhat likely to do so.
Of the adventurous ones likely to visit Cuba, only 4 percent plan on
doing so in 2016, while 10 percent will do so in 2017, and the remainder
don’t know when.
While Americans determine their likeliness to travel to Cuba in the
future, according to permitted categories of travel, they will also make
decisions based on changes in travel infrastructure in the country that
still need to happen. This includes key areas such as: being able to use
a credit card there, having access toWi-Fi and the internet, the presence
of modern medical facilities, staying in hotels with modern and up-to-
date amenities and services, and traveling via U.S. airline flights and
cruise vessels.
Don’t Forget There’s
Still an Embargo
Along with general concerns and a
lack of infrastructure, it’s important
not to lose sight of the fact that the
Cuba embargo has not yet been
lifted, according to Tomas Acevedo,
Esq., director of state government
affairs and legislative counsel for
the American Resort Development
Association (ARDA). “Travel to Cuba
for general tourism is still not per-
mitted for U.S. citizens,” he says.
“It’s only allowed if it falls within
[the] 12 categories identified in the
Cuban Assets Control Regulations
enforced by the Office of Foreign
Assets Control (OFAC).” (See sidebar on following page.)
The only change, he notes, is that a specific license is not required
as long as the reason for travel falls within one of the 12 categories of
travel. Previously, travel for any of these reasons required a specific
license to be granted by the OFAC.
What Does This Mean for Timesharing?
Because no timeshare legislation exists now in Cuba, timeshare oppor-
tunities on the island are not immediate, and a lot needs to happen first
between the U.S. and Cuban governments in order to create an environ-
ment for business to thrive, says Acevedo.
“A U.S.–type timeshare product would be hard to conceive in Cuba
at this time. It certainly wouldn’t be a deeded product in Cuba because
all land belongs to the government,” he explains. “Any timeshare law
[would likely only] allow a right-to-use product, which has worked well
for Mexico and the Dominican Republic. They are the two most suc-
cessful timeshare markets in the region.”
Changes in regulation are certainly critical for the establishment of
timesharing in Cuba, observes Marcos Agostini, Interval International’s
senior vice president of resort sales and service for Latin America.
“Because the U.S. consumers are the number-one buyers of timeshar-
ing, regulations that recognize some formof the right-to-usemodel would
be helpful and wouldn’t interfere with Cuban real estate laws.”
In terms of purpose-built new product in Cuba, Acevedo says the
most likely scenario could result from an integration of existing sites into
a multisite offering.
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