The US Virgin Islands has enacted a new bill aimed at spurring hotel development and construction in the Caribbean territory.
The USVI’s expanded Hotel Development Bill gives hotel developers the ability to channel a percentage of room revenue both to finance the renovation of existing properties and to build new hotels.
“The signing of this bill is a game-changer for the Territory’s hospitality industry. It will significantly benefit hotels, resorts, and small businesses impacted by increased tourism and accelerate opportunity for employment in the Territory,” said Kamal I. Latham, CEO of the US Virgin Islands Economic Development Authority.
Under the new law, hoteliers can use up to 100 percent of revenues generated from the USVI’s existing occupancy tax to finance new hotel construction or renovations.
That also includes 100 percent of gross revenue generated from the USVI’s newly-created Economic Recovery Fee, which is up to 7.5 percent of the hotel guest’s bill.
“This is a very powerful hotel development and infrastructure financing mechanism that creates an environment for new development,” said Stephen Evans-Freke, President of Water Island Development Company. “It opens the door for transformative projects like ours to strengthen the island’s position as a top tourism destination.”
The legislation aims to spur development in a territory that has seen almost no new hotel development in the last few decades, significantly lagging its Caribbean neighbors.
“The bill demonstrates government commitment to hotel companies through upfront investment in new hotel supply and upgrades to existing tourism products as well as creating career opportunities for residents,” said Bill Tennis, Executive Vice President, DiamondRock Hospitality Company, owners of Frenchman’s Reef Marriott Resort and Noni Beach Resort.