As America’s Cup decision looms, homeowners keen to offer properties for rent
An America’s Cup competition in Bermuda could bring hundreds of millions of dollars to the Island over an extended short-term period, but substantially improve long-term tourism and other business prospects, going forward.
Evidence of this is found in an economic impact study on the effects of the competition on the last host, which enjoyed a half a billion dollar windfall.
But weeks before a decision over if Bermuda will even host the 2017 event, homeowners are already offering up their properties for short-term rentals.
The 34th America’s Cup generated between $364.4 million and $550.8 million in economic activity in the city of San Francisco. The city reaped millions of dollars in additional taxes.
The report estimates that the event generated $325.38 million in total expenditures by participants and spectators. The total economic impact exceeded $550 million.
The event and related activities supported the equivalent of thousands of new jobs.
“The Economic Impact of the 34th America’s Cup in San Francisco” was a report prepared by the Bay Area Council Economic Institute for the San Francisco America’s Cup Organising Committee.
The America’s Cup would showcase Bermuda to an international television audience in over 200 countries and provide high-value media exposure to a large number of potential visitors.
The head of the restaurant division of the Chamber of Commerce, Jean-Claude Garzia, said it would be a boost to the economy.
“It would be incredible for Bermuda,” he said. “There are not enough hotel rooms to accommodate all the people. We would have to hire cruise ships to handle the surplus.”
He said that it would be a huge boost for Bermuda’s 126 local restaurants, many of which just recently capitalised on the Newport to Bermuda race.
But outside Newport week, many restaurants have struggled since the downturn in the economy chased thousands of workers out of the country.
Fellow restaurateur, Phil Barnett, president of Island Restaurant Group said: “The exposure would be great because pictures of Bermuda alone would sell the Island. And the people here for the America’s Cup would be here for weeks. That would be great for retail and restaurants.
“There are too many restaurants right now for the amount of business. We need to create demand.
“Unlike the Newport race, the people who would come here for the America’s Cup would be here for quite some time.
“New hotel properties are coming on line. Pink Beach is breaking ground. The existing hotels could certainly use extra business. And I’m sure there are a lot of vacant residential premises, after the exodus of so many guest workers. It must be 10,000 less people here.”
Studies commissioned a few years ago by past Royal Bermuda Yacht Club Commodores on the economic impact on Bermuda of the Newport race, estimated a $10 million to $12 million windfall for the Island.
One of those past Commodores, Ralph Richardson, said, “If you had 2,000 sailors for the Newport race, you would have an additional 1,000 spectators come into the Island over a week and a half.
“But America’s Cup will bring a lot of people to watch the race. They will need the cruise ship option to accommodate some spectators.
“And the America’s Cup has so much hi-tech gear, it is an extreme sport now. It will yield global coverage. If we hosted the finals it could pave the way for other activities here. I’m pretty excited about the potential.”
Given the large role that the non-local spectators and the race organisations play in the economic impact, it is not a surprise that accommodations are the largest single contributing category of economic impact.
The San Francisco report estimates that some $92 million was spent on accommodations, real estate, rental and leasing.
Penny MacIntyre, executive vice-president of Rego Sotheby’s International Realty, said that many Bermuda land owners already see the potential.
“Many people have approached us,” she said. “They have expressed interest and excitement over potentially renting out their homes for the America’s Cup, or the trials.
“This could be a wonderful opportunity to make their homes, their apartments or their condos available.
“Obviously, timing is of the essence to make sure that you have accommodations for the sheer number of people who might be coming, should Bermuda be selected.
“We can’t control whether or not there would be a new hotel in place at that time, or cruise ships available to house some spectators. We leave that to the powers that be.
“But it raises the bar for people who would like to make their homes available. It is a great short-term opportunity.”
Ms MacIntyre also noted the long-term opportunities for business in general.
She said, “It would be good for real estate — on the sales side, absolutely. Bermuda — with some good fortune right now — has had interest on the home sales front. There are more international buyers looking at Bermuda.
“This event would remind more people that Bermuda is a viable destination for investment opportunity and for residence. The America’s Cup audience is a great buying audience for Bermuda, because of how active we are in sailing, regattas and water sports.
“There’s a lot of lead-up that goes into America’s Cup. There is branding and sponsorships and other events associated with it.”
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