Cuba Real Estate Not For International Buyers, Envoy Says

Cuba Real Estate Not For International Buyers, Envoy Says
By Mike Blanchfield, The Canadian Press
Posted: 04/06/2015 3:12 pm EDT Updated: 04/06/2015 5:59 pm EDT

OTTAWA - Vast, sandy expanses of undeveloped Caribbean coastline,
sprawling green countryside and the faded but lingering beauty of old
Havana have sparked many a business development fantasy in some of
Cuba's more entrepreneurial visitors.

Those dreams of new beach resorts, golf courses and condos seemed a
little closer to reality after this past December, when presidents Raul
Castro and Barack Obama declared Cuba and the U.S. would try to
normalize relations after 53 years.

But Cuba's top North American envoy has a special message to all those
dreamers — keep dreaming.


"We are not against selling property, but not freely," said Julio
Garmendia Pena, the Cuban ambassador to Canada.

"We want to keep the country for Cubans."

In a recent speech in Ottawa to an audience of diplomats, academics and
government officials, Pena made clear Cuba may be open to foreign
investment, but buying land is not on the table.

Many obstacles remain to a full-on Cuban-American rapprochement,
including two big ones — establishing diplomatic relations and lifting
the crippling U.S. economic embargo, which Cuba simply calls the blockade.

But the biggest one is a long-running feud over property, valued at
billions of dollars.

After Fidel Castro's communist revolution in 1959, the new Cuban
government seized and nationalized U.S. assets across the country. These
included the American-owned telephone company, utilities, sugar cane
fields, and various properties, including several Hilton hotels.

When heiress Paris Hilton recently visited Havana and posted selfies in
front of the old Hilton hotel, she was castigated online for thumbing
her nose at the legacy that underwrites her current life of celebrity
leisure.

The value of seized American assets has been estimated at as much as $7
billion, much of it claimed by the very angry and influential Cuban
expatriate community in Florida that reviles the Castros.

Like many other informed observers, Mark Entwistle, Canada's ambassador
to Cuba from 1993-97, said Monday some sort of compensation agreement
will have to be reached before Cuba and the U.S. can move forward.

As one of the founders of a Toronto-based boutique merchant bank (his
partners include Belinda Stronach and former Onex executive Anthony
Melman), Entwistle has spent a lot of time in Cuba the United States
recently.

One refrain he is hearing in the U.S. these days goes like this: "How do
I buy that piece of beachfront, how do I buy a downtown city block of
Havana to redevelop it?"

No time soon, is Entwistle's standard answer, because Cuba views land as
a national asset that belongs to the state.

"There's a sense, especially in the United States, that there's some
gold rush bonanza is about to happen," said Entwistle.

"This is largely informed by a tremendous lack of information and
understanding of Cuba itself, and where the Cubans have come from, and
who they are and where they're going."

Pena himself made clear that Cuba had learned lessons from its
pre-revolution era of American influence.

"We already went through this," he said. "And at the end of the day,
when we began to see who is owning these properties, it was a
frightening list. So we decided to be more careful in that direction."

Eventually, Entwistle said, Cuba will have to open itself up to more
foreign investment if it wants to grow an economy hobbled by a half
century of economic isolation from its massive neighbour 135 kilometres
to the north.

But that doesn't mean Cuba will start selling off deeds and titles to
hoteliers and developers, especially from the United States, he added.

"A situation in the past, in Cuban history, where one country owned
two-thirds of the national economy and all the utilities and phones and
electricity and over 80 per cent of the fertile sugar lands and
agricultural lands — that's not going to happen again."

That is if you're an interested international buyer.

Source: Cuba Real Estate Not For International Buyers, Envoy Says -
http://www.huffingtonpost.ca/2015/04/06/cuban-property-not-up-for_n_7012498.html?utm_hp_ref=canada-business&ir=Canada+Business