Condos
Condo sales prices actually showed a slight increase over last year but the more telling statistic is that 20% fewer units were sold this year than last year. As a result asking prices for condos are now 13% less than last year. With the Off Season upon us we look for further discounting especially in the mid to upper mid range. At present inventories are about even with last year but we expect an increasing supply. On the plus side this past season another Great House topped the $3 Million mark and 5 of 6 of Brian Butler's Mandalay Units have been sold. One superb property which has just come on the market is a ground floor corner unit at Sovereign. This 4 bedroom oceanfront suite is the finest condo available in Cayman. Call us for details. Nearly all of the Plantana inventory sold this season including 4 of 5 units listed with Coldwell Banker Cayman Islands Realty but there is still one excellent buy there. Oceanfront resales at Colonial Club and a recently reduced brand new custom furnished unit at Crescent Point are good bets. Buyers now have the leverage in the condo market-place.

Homes
Sales prices and marketing time are virtually even with last year and listing prices are up by 5% although the number of sales is down 19%. At the top end, interest has been high with two homes on the south shore under contract between US$3.5 and $5.0 M and another in Governors Harbour at $2.0M. Two of these three properties are listed with Coldwell Banker Cayman Islands Realty. Canal front homes continue to be in high demand and Coldwell Banker Cayman Islands Realty has sold 3 homes in Governors Harbour & Canal Point. The best buy for a previously owned upscale residence is the Greenfield House in Britannia. Featured in an upcoming issue of Marie Claire magazine this home has all the amenities including room service from the Hyatt. At US$2,950,000 it is a very private property at an excellent price.

The houses on Seven Mile Beach which we alluded to in our last issue are now available for sale. Formally named "The Beach Houses" these 7600 sq. ft. six bedroom villas will be oceanfront, and within stunning West Indian architecture will contain state of the art home automation systems and the finest fixtures, fittings and materials. The landscaping plan is expected to be the finest ever produced in Cayman. As the developers are an arm of the Dart Corporation, the quality of the final product and the lushness of the landscaping are assured. These 4 homes are offered separately for US$5.5 M complete but unfurnished.

Commercial
While fewer properties have changed hands, the value of those which have is nearly twice as high as last year signaling a shift toward the prime downtown properties. We feel this trend is likely to continue and foresee several downtown properties which have been listed for some time finally selling. Notably among these is the land between AALL Bank and the Bakery and the property on Dr. RoyÄs drive listed by Coldwell Banker Cayman Islands Realty. Another likely event in the commercial arena is the development of secure warehousing which will provide long term record storage with complete hurricane security for the financial community. We have such a project on the drawing board ù please call for further details. The sale of the Old McTaggart Property with prime views of the George Town Harbour was also completed this season by Coldwell Banker Cayman Islands Realty.

Residential Land
Residential Land has been moving but buyers have been careful about their spending. Land at reasonable prices is moving but higher priced property is not. Good beach and well located waterfront and inland property will always be in demand.

Development Land and Hotels
Sunshine Suites and Comfort Suites are now open giving our tourists choices at a lower price level. The Holiday Inn construction is going great guns and expects to open its doors in November. The upper floors will have great views. We hear the Dart Group has received planning permission for their West Indian Club Resort/Hotel project. Wonder which one will be built first - the West Indian Club or the Ritz?

Sister Islands
Cayman Brac has seen reasonable activity partly due to duty concessions and partly due to some unhappiness with the fast pace of life on Grand Cayman. But sales have been lagging in Little Cayman. The new airport has been given approval and that should stimulate business there. Care must be taken to maintain the "out-island" atmosphere of Little Cayman which is why people go there in the first place. A further concern is where we will find the money to build it. However, Little Cayman cannot grow at all with the current lift capacity.

Special
Bureaucracy/Inflation - Cayman does not exist in a vacuum and the bureaucracy of our neighbors appears to be contagious. Statutory Boards and Departments are making doing business here much more complicated and much more expensive. At the very least this is an inflationary factor in an already expensive destination. The "controlled growth" which we are looking for will not properly be accomplished by roadblocks set up by other departments after a developer has already been granted planning approval. Such actions are viewed as unfair and a development climate viewed as unfair will lead to no growth. Further, if the current pace of expenditure by the government is continued, it will create a further financial burden on Cayman either through an unacceptable debt load or a more direct drain on its residents due to higher costs of living.

OECD - The alternatives as presented to Cayman by the USA and UK through the OECD give us no real options. If we do not agree to begin to accommodate requests for information on tax matters for individuals who are under investigation we will be blacklisted and lose the growing institutional business which is CaymanÄs financial future. If we do agree to accommodate requests for information we will hopefully not be blacklisted but we will loose some individual private banking business which was a large part of our financial past. The unfortunate fact is that even without the OECD initiative the UK and shortly the US will have the power to force Cayman to divulge this information anyway. As a result we expect that Cayman will agree to a modified OECD plan which will phase in compliance over 3-5 years. This will keep us off the blacklist and allow us to continue to grow our institutional business. Meanwhile some of the private banking clients will look for other havens, while others will find other loopholes and remain here. What effect will this have on the Real Estate Market? In the short term, residential supply will probably rise and since demand has dropped off, prices will fall. In the short term, commercial real estate will remain the same or possibly rise due to the influx of institutional business. In the long term, residential real estate will begin to rise again as we feel the effects of new business but commercial real estate will rise even faster and earlier due again to expected institutional expansion.

Kudos
For the second year running Coldwell Banker Cayman Islands Realty was honoured as first in the Caribbean and second in the world for sales volume in our office size at the Coldwell Banker International Convention in Las Vegas. Congratulations to Donnita Moist our #1 Sales Agent for 1999. Donnita has recently fallen ill and we all wish her a speedy recovery. Congratulations also to Carlene Alexander-Kay and Daryn Lansdell, two new agents who have made their mark already with several sales under their belts. Our Cayman-style offices and new extension were recognized recently by the Cayman Islands National Trust with a Historic Preservation Award for new commercial buildings which perpetuate Historic Principles of Design.

Forecast
These are very unsettled times both worldwide and in the Cayman Islands. We expect a fairly slow summer while everyone waits for the above factors to have their effect. In other words we expect overcast skies with intermittent rain showers. But the best part of a storm is that the weather is always clearest after its over.

For information on specific purchasing or selling opportunities or general market or investment advice, call any member of our knowledgable staff. We don't claim to be experts on everything - just Real Estate.