Luxury Real Estate

Jim Walberg of Caribbean Islands Realty.  

Diageo’s Captain Morgan Rum’s distillery in the U.S. Virgin Islands is finally scheduled to produce rum by the end of the year. Diageo, the parent company of Captain Morgan Rum, and a United Kingdom-based company that is the largest distilled spirits maker in the world, expects the construction of their new St. Croix location to be completed by October and have rum in the aging barrels by December. This week’s simple announcement is packed with controversy that has been boiling for over a year. The rest of the complicated “story” is worth the read.

For many years, a third party distiller in Puerto Rico has been producing Captain Morgan Rum and selling it to Seagram’s. Diageo bought the Captain Morgan Rum label in 2001 inheriting this third party manufacturing agreement. They have looking for years how to arrange a way for them to produce their own rum under the Captain Morgan Rum label. With the manufacturing plant now being built for Diageo to produce the rum themselves, Puerto Rico will be losing millions of dollars that were coming to their territory from the rum excise tax. Since they will not be getting any of these taxes, they are protesting to the Congress that the U.S. Virgin Islands should not get any of them either, because the USVI is going to use these taxes in order to finance the construction of the new distillery on St. Croix.

Here is a brief description of the rum excise tax program. Rum produced in the U.S. territories and sold in the U.S. is taxed at $13.50 per proof gallon, and $10.50 per proof gallon is then returned to the territory where the rum is produced. In 1986 the amount was extended to $13.25, but that extension must be reauthorized periodically and that reauthorization was due by the end of 2009.

Not only is Puerto Rico protesting to Congress they are lobbying to have Congress change the rules related to the remittance of the rum excise tax to be paid to the USVI. Puerto Rico is not just mad about the loss of millions of dollars of the rum excise taxes, they are FURIOUS! They have secured a member of Congress with Puerto Rican heritage, Rep. Luis Gutierrez (D-Ill.) to co-sponsor HR 2122 to eliminate the rum excise tax. He said, “It is preferable for the whole program to be dismantled than to have it used like this. If one is going to use the program to enrich companies, it doesn’t have to exist at all.”

Puerto Rico and Rep. Gutierrez are claiming the USVI have enticed (bribed) Diageo to sign the agreement to produce their own rum on St. Croix by financing the construction of the manufacturing facility using the rum excise tax. And, when the cost of the plant has been recovered, the USVI will also share a portion of the rum excise tax with Diageo. Virgin Island Gov. John deJongh Jr. has stated to Congress that Puerto Rico’s case is completely wrong. The USVI’s never entice an established Puerto Rican business to leave their island.

Since 2001 when Diageo purchased the Captain Morgan Rum label they have looking for alternatives to end the arrangement it had inherited with Puerto Rico. Number One: Diageo has never has produced rum in Puerto Rico so how could they be lured away. Number Two: Since 2001 Diageo has been searching for a site where it could produce its own rum. Number Three: Diageo concluded very quickly it could not make a satisfactory arrangement with Puerto Rico. Number Four: Diageo had investigated sites in Jamaica, Guyana and Guatemala before they ever entered discussions with the USVI Virgin Islands.

This is a BIG deal for the USVI and their financial future. It will create about 120 new jobs, and generate almost $3 billion in rum excise taxes to the USVI over the 30 term of the agreement. We believe this is a significant Win/Win for the USVI and Diageo, and it is anticipated there will be no change in the laws regarding the rum excise tax rules currently in place in Congress. What are your thoughts about this drama between Puerto Rico and the USVI? Until next time…fair winds!

By Robert Lockard

For the past several months I’ve had the pleasure of posting content to the LuxuryRealEstate.com Blog from Jim Walberg, an experienced blogger and the co-Broker/Owner of The Bay Area Team, the most-successful team at Keller Williams Realty-Danville, Calif. Jim’s Caribbean Islands Realty Blog is very well-established and fun to read so I’m always glad to include his work on our blog, with his permission, of course.

Jim took the time to point out something awesome to me in an email on June 11, 2008. I have read about blogs helping with search-engine optimization, but Jim’s message really drove this idea home to me (The links weren’t in his message originally. I added them):

”You may notice when you use my blog postings that LuxuryRealEstate.com jumps up on the Google search engine. I have “owned” Aruba Fractionals on Google for months! LuxuryRealEstate.com just jumped to the top of page one with the posting of my article on your blog site. It is so fun to see how this blogging game works. It is my pleasure to support LuxuryRealEstate.com in any way I can.”

One other comment Jim made also impressed me: “The power of blogging is based on one’s understanding the ‘rules’ that Google and Yahoo have set up for search-engine optimization. The next is to understand the ‘strategies’. Don’t forget, strategies always beat out rules. What I have found among the blogging world is that all of us are constantly sharing strategies. We all want each other to ‘win’. That is one of the fun cultural experiences you will find in the blogosphere. I am always available to share.”

Thanks for the great message and for all of your help, Jim.

I still feel like I'm learning the ropes when it comes to blogs, trackbacks and all of these inventive ways to provide great content and be rewarded by search engines. I think it’s very important to write about important topics first and worry about good placement and all that other stuff second. It’s nice to know that Jim Walberg, who has found a great balance between the two, is on our side!


Editor’s Note:
Robert Lockard is the Public Relations & Media Specialist with LuxuryRealEstate.com. I am Robert. I create all of Luxury Real Estate’s newsletters, write the editorials in LuxuryRealEstate.com Magazine and much more. You can contact Jim Walberg at jim at jimwalberg.com. I sure put a lot of links in this blog entry. I guess I just had a lot of information to cram into a couple of paragraphs, plus I’m learning how to provide more links for the search engines to find us.

By Jim Walberg

From his blog: Caribbean Real Estate Photos Instantly Take You There Wherever Your Computer Is!

Ilya Moshensky is one of the finest real-estate photographers that I have met!

I first met Ilya at the Luxury Real Estate conference in Del Mar, Calif. several months ago. He seemed to be everywhere during the conference taking photos of the participants and various events. I final asked one of the Luxury Real Estate staff people who was this guy! She smiled and said that he is the finest photographer they had found for capturing the essence of luxury real estate homes and estates. I began some homework after the conference to see some examples of this work since we always need a top photographer’s services for the luxury properties we represent - both in the Caribbean and the San Francisco Bay Area. Boy, was I impressed with what I discovered.

My experience is that Ilya’s Photography sets one of the highest standards for quality in the industry with over 30 years of experience. Ilya is the principal photographer of Ilya’s Photography, and he has enjoyed a lifelong passion his work with the camera. His reputation for excellence has spread both in the U.S. and internationally. Ilya has shot luxury estates in France, Spain, Switzerland, Costa Rica, Miami, Chicago, the Seattle area, plus many other locations in the States and the world. After checking out his work, my next question was, “How much does this type of quality photography cost for shooting a luxury home or estate?” Well, I discovered that he has VERY competitive rates that are negotiated flat-rate prices for any project. He is even willing to offer long-term budgeted photo-shoot contracts. His flat-rate policy is greatly appreciated within our industry because it is THE rate no matter how much time it takes to complete the project. Again, I don’t think you will find a better value for your marketing dollar if you decide on Ilya’s photo services.

In further discussions with the staff at Luxury Real Estate their consensus was that Ilya consistently produces quality work and can make a home or an estate look amazing. They said he has the ability to capture on digital film the best aspects of the luxury property. As promised, I am always on the look out for the best professional services I can find, whether it is a photographer or a painter. It takes a “village” to sell and buy a home - from the preparation of the marketing program to the signing of the closing documents, hiring a professional real-estate company is critical. Until next time….fair winds!


Editor’s Note:
Jim Walberg is the co-Broker/Owner of The Bay Area Team, the most-successful team at Keller Williams Realty-Danville. He is also a member of the global LuxuryRealEstate.com network. Jim is an experienced blogger, as you can see by visiting his blog, Caribbean Islands Realty. Feel free to submit your blog entries and comments to the LuxuryRealEstate.com Blog. Also, you can contact Ilya Moshenskiy to take advantage of his amazing photographic services at ilya at ilyaphoto.com. I highly recommend him, as well.

By Jim Walberg

We have just ended the first month of 2008 and my January 3rd Predications are being confirmed every day regarding the trends of Caribbean real-estate buyers! The deeded fractional ownership is having a dramatic impact on the buying patterns of Baby Boomers, Brits, Europeans and Canadians. Their appetite for full ownership of second and third homes/condos in the Caribbean is being refocused on the fractional-ownership resorts being developed by BIG international companies!

Buyers seeking Caribbean properties are recognizing that they are not going to live there full-time, so why have the responsibility of full ownership when there is an excellent resort management company in place to maintain and even rent a deeded fractional-ownership property as part of the purchase? An example of this trend can be witnessed in Aruba. There are more than 2,000 fractional-ownership units planned for this island by international developers cashing in on waves of buyers! (There are always exceptions to this thinking when the price point and the product are too good to pass up for full ownership, such as South Beach – Belize)

What does all this mean for the sellers and buyers of Caribbean real estate? If you are a seller, get your home on the market NOW with the most experienced international REALTOR® you can find who understands this market and has an effective Internet-based marketing strategy in place. As a buyer in 2008 for Caribbean real estate, you are going to have your pick of some great bargains, and ones that have huge upside appreciation that are available to those who know where the values are.

Some of the real-estate “hot spots” are St. Kitts, St. Vincent, Anguilla, Belize, Dominic, and the Dominican Republic. The outlook for buyers and sellers in the Virgin Islands and the Caribbean is “bullish” for 2008!

Deeded fractional ownerships will continue to gain market share away from the fully owned homes and townhomes/condos products. Those who have Euros, Pounds or Canadian dollars will have the best buying power for any real estate connected to the U.S. dollar. Again, be sure to find the best REALTOR® you can to represent you in all of your international real-estate transactions. A great resource for top-quality international REALTORS® is Luxury Real Estate!


Editor’s Note:
What an enthusiastic endorsement! To contact Jim Walberg, email Jim@JimWalberg.com or visit www.CaribbeanIslandsRealty.com. Fractional-ownership resorts have a lot of advantages as second homes and vacation spots. In fact, I recently wrote a four-page editorial on fractional-ownership resorts, which are also known as Private Residence Clubs, for LuxuryRealEstate.com Magazine. The story will be appearing in the Spring 2008 issue of the magazine. Click the following link to read the Winter 2008 issue of LuxuryRealEstate.com Magazine.