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Eleuthera poised for boom period

Eleuthera poised for boom period

Investors tip island to be the next big thing for second home, beachfront developments

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The Bahamas Investor Magazine
December 8, 2010
December 8, 2010
Catherine Boal

Famous for its pink sand beaches and fascinating history, Eleuthera is one of The Bahamas’ most interesting islands. Now this sleeping beauty is poised for growth, thanks to renewed interest from local developers and wealthy sunseekers eager to invest in their own slice of paradise.

The first European settlers to make Eleuthera their home were led by William Sayle, a former governor of Bermuda, who fled to the island after falling out of favour with the English authorities. Sayle and his group of 70 faithful followers made their way to the island in 1649 and, after being shipwrecked on the treacherous reefs off Spanish Wells, washed ashore in what is now known as Preacher’s Cave on the north side of the island. The Eleutheran Adventurers, as history named them, eventually made their way to Cupid’s Cay, now regarded by many as the birthplace of The Bahamas.

Although Sayle was to eventually return to Bermuda, his sons remained in Eleuthera to govern the small community that had made the island its home.

During the piracy era, the island thrived economically thanks to its treacherous reefs, which locals took full advantage of–using lanterns to lure ships onto the rocks and plundering them once they were wrecked.

By the early 1900s, however, Eleutherans had engaged in a much more reputable means of growing their economy, namely farming. The pineapple industry was responsible for one of the greatest boom times in the island’s history, although production in recent times has declined.

Today Eleuthera, which is 110 miles long and only two miles wide, is the fourth most populated island in The Bahamas and benefits from its close proximity to both the country’s capital Nassau and the US.

Island charm
The name Eleuthera derives from the Greek word eleutheros meaning freedom, and it is easy to see why it was so named. Over the years, scores of investors have been drawn to the island’s easy charm and relaxed tropical lifestyle. Two of the most notable migrants were the American industrialist Arthur Vining Davis and Pan American Airways founder Juan Trippe. These men are frequently credited with bringing about the most sustained period of growth in Eleuthera’s long history.

Davis was the island’s first developer. He first came to the island in the 1930s and eventually acquired around 30,000 acres. In 1952, his plans to build a hotel in Half Sound, South Eleuthera, were thwarted when the government at the time rejected his proposal and he eventually sold the land to Trippe.

The airplane magnate not only expanded the Rock Sound airport to improve transport links to the island, but also, in 1959, built the legendary Cotton Bay Club. In its heyday, the club attracted wealthy American industrialists, celebrities, and even royalty.

Trippe went on to build the Cape Eleuthera Resort in 1973, but it closed ten years later.

Idyllic lifestyle
Almost three decades on, Eleuthera is ready to return to its previous glory days thanks to new developments and a resurgence in the second home market.

Arvid and Nadiya Hvidsten, a married couple in the property development business, are hoping to capitalize on Eleuthera’s potential by targeting foreign homebuyers.

The Hvidstens, who have over 20 years experience in the real estate sector, live and work in Fort Lauderdale, Florida, but are frequent visitors to The Bahamas and, in particular, Eleuthera where they own a house and several lots. Arvid Hvidsten, who is a broker and real estate dealer, obtained the lots almost by accident, when they were included as part of a bigger deal negotiated in the US.

“I ended up with these lots in Eleuthera and took them on without even looking at them,” he explains. “We went down there in February 2004 to see them and fell in love with the island right away. We hired bicycles and biked around all over to see it. We came back more and more–every month after that for several years.

“We love the nice beaches, and the people are very friendly. There is almost no crime. I’ve been to Freeport and Nassau many times and they cannot compare. There is a tranquillity and a different mindset to the people.”

The couple, who have worked together buying and selling property for 10 years, were so entranced by the island that they bought a house in Palmetto Point, an area south of Governor’s Harbour. They use the property as a holiday home, soaking up the relaxed island lifestyle and bringing their friends and family out to enjoy it with them.

“We take family out there and we show them around. We’ve had some of my family from Norway out and they all love it. It is so nice, quiet and peaceful,” says Arvid. “Our house is right on the water. We go in the wintertime to escape the hustle and bustle of life [in Florida], to just relax and take it easy.”

Property boom
Eleuthera, which is shaped like a string bean, is divided into three districts–north, central and south. The Hvidsten’s lots are located in the central area and have proved popular with overseas buyers, particularly those from Europe.

“We have had a good response, mostly from Europeans,” says Hvidsten. “I think what attracts them is the weather and the beautiful beaches. People from Europe come to look at the property and, even though they have had a long journey, once they get to Eleuthera, they forget all that.”

Hvidsten, who began his career in the US with real estate firm Coldwell Banker, believes that, while the property sector is stagnant at the moment, the second home market is going to help propel the island forward into a period of significant growth.

“It is slow, we cannot deny that, but the prices are holding in Eleuthera better than in the US. I think that is because there are more international buyers. It will definitely pick up and something will start to happen in the next couple of years. It is going to boom,” he says.

Top destination
In 2006, Travel + Leisure magazine named the island one of the top five destinations in the world. That same year, Eleuthera Properties Ltd announced the launch of the $300-million Cotton Bay Estates & Villas development, which is presently under construction and encompasses luxury villas, a spa, clubhouse and golf course.

In south Eleuthera, Cape Eleuthera Resort and Yacht Club luxury estate homes, beachfront villas and marina opened in 2008, with a development cost of around $85 million.

Hvidsten sees these projects as a positive sign that growth is on the way. “Tourism is going to come up as there’s been some development in the last few years. [Eleuthera] is really going to take off,” he says.

For now, the property pair is planning to sell some of their lots and develop others. Like many other investors and developers, they are preparing for the next boom period of growth in Eleuthera.

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Sidebar:
Cays on the market
The Bahamas is home to over 700 islands, many of which are small, low-lying and composed of mainly sand and coral, known as cays (pronounced keys). Below is a selection of the most sought-after cays currently on the market and ready for development:

Cave Cay
Lying in the beautiful Exuma chain, $110-million Cave Cay is poised for development, with approval already granted for a hotel and clubhouse.

The 222-acre island boasts its own 2,800 ft private airstrip, 35 dock marina and deep-water harbour.

Children’s Bay Cay
Just north of Great Exuma lies Children’s Bay Cay, a 167-acre slice of land with approvals already granted for hotels and associated commercial operations.

The island is on the market for $37.5 million and comes with a private marina and a dock. Some infrastructure, such as roads, is already in place.

High Cay
High Cay just off the coast of San Salvador is on the market for $3 million. The 31-acre island is easily accessible via San Salvador’s international airport and, as real estate agent John Christie suggests, is perfect for an exclusive, high-end retreat.

Boasting three beaches and high elevations, complete with unique white cliffs, the cay is paradise for nature lovers and watersports enthusiasts.

Big Darby Island
One of the largest of the Exuma Cays, Big Darby Island is 554 acres and could support a 3,000 ft to 5,000 ft runway. The cay includes a protected deep water harbour and the ruins of a castle suitable for redevelopment.

The $37.5 million island is 95 miles from Nassau, 14 miles from Great Exuma and 250 miles from Miami.

Leaf Cay
Located in the Exuma Cays, Leaf Cay is 30 acres and is the only private island in The Bahamas to have power supplied by the Bahamas Electricity Corp.

The island, priced at $6 million, has a two-storey private residence, guest quarters, a 1,500 ft airstrip and a dock.

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