For the past two years, Martin, a jovial, near-retirement age, chain-smoking businessman from Slovakia, has been a nightly feature at the lobby bar of Havana's Occidental Miramar hotel. Martin-who declined to have his last name printed in a U.S. publication-has been shuttling between Havana and Caracas ever since the Cuban economy started booming two or three years ago and oil-rich Venezuela began spending billions of dollars on housing programs. Thanks to his efforts, he says, one of his Slovakian clients landed a contract with the Venezuelan government to build several hundred prefab homes for working-class families, and he's working hard to get a similar deal for that company in Cuba.
Why should we care?
If you could fly from SRQ to Havana, it wouldn't take much longer than to Tallahassee. And if you flew a straight line, it would take exactly the same time to get to Caracas as to Denver. The salesman from the landlocked country across the Atlantic Ocean wouldn't stand a chance if hotel lobbies in Caracas and Havana were swarming with homebuilders from the United States. Yet they aren't, because most businesspeople here perceive Cuba, Venezuela and the rest of the Caribbean Basin as if they were in a different galaxy, not at our doorstep.
Times are changing, though, and the big blind spot on our mental map is shrinking. A small but growing group of entrepreneurs has realized that Sarasota-Bradenton isn't a bad location at all to do business with Caribbean Basin countries.
For one, historical connections, like that between Florida cattle ranchers and the Cuban market, are being rediscovered. A more recent phenomenon is the people connection: the number of Sarasota-Manatee residents with Caribbean roots is now at about 10 percent, and growing fast. To many of them, doing business with their country is a natural.
But a growing number of U.S.-born businesspeople are getting the hang of it, too. One reason is that air connections are quite good. Nearby Tampa International Airport serves San Juan, Puerto Rico, the Caribbean hub, twice a day. Another Caribbean hub, Miami International Airport, is just a commuter hop away from SRQ.
Still auspiciously absent from Caribbean trade are the region's manufacturers, which is surprising given the existing infrastructure. Airports aside, there are two ports nearby with regular cargo connections to destinations throughout the Caribbean Basin. Port Manatee, for instance, offers scheduled runs to Mexico's Yucatan, Guatemala, Costa Rica and Venezuela, and port executives are at the forefront among U.S. ports of opening up shipping connections with Cuba.
To most local businesspeople, whose livelihood is tied to the region's red-hot real estate and construction-driven economy, these facts didn't matter a whole lot-until the market began to cool. As construction is slowing and prices are maxing out, local developers, brokers and builders are beginning to search for the next frontier. Michael Saunders & Company, for example, plans to open an office on Eleuthera, an island of the Bahamas. Owner Michael Saunders recently told the Wall Street Journal that her clients like to buy second homes in the Caribbean in their search for the pristine Florida that was lost a while ago.
To be sure, the Caribbean Basin is a hodgepodge of markets very different in size and character.
"If you look around the Caribbean region, a number of countries have done remarkably well on certain criteria," says Brian Meeks, director of the Centre for Caribbean Thought at the University of West Indies in Jamaica. "Just think about places such as Barbados, the smaller eastern Caribbean islands, the Cayman Islands. Trinidad and Tobago have done well, not because of some grand scheme but because of their petroleum wealth. But the story underground is far more complex than that. If you see beneath the surface, you see that poverty is still present, that unemployment is still extreme in many territories, and that nothing substantially has changed."
Although Washington seems to be mainly preoccupied with socialism versus free market rule these days, foreign investors in most Caribbean Basin countries are facing much more fundamental problems: The skin-deep reach of government; corruption and crime; the rule of drug mafias, gangs and quasi-feudal landlords; and the profound social divide with ensuing conflicts tearing apart countries such as Haiti, Mexico, Jamaica, Guatemala, Nicaragua, Honduras and Colombia.
Not surprisingly, the majority of Sarasota-Manatee entrepreneurs choose to do business in the wealthier Caribbean islands and in stable Costa Rica. That will leave Martin and his Slovakian companies a little more time to do business in Venezuela and Cuba.
The Refugee Investor In a league of his own is Styrofoam prince turned junk bond king Kenneth Dart.
Fifteen years ago, the CEO of Sarasota-based Dart Container Corp. began a new line of business: Investing in sovereign bonds of developing nations that are about to default. His sizable discount investments in junk bonds from Brazil and Ecuador, with subsequent suing in New York federal courts for full repayment, paid off handsomely with hundreds of millions of dollars in profits.
But his new business also made him enemies. Last year, Buenos Aires daily El Clarín declared him "Argentina's most hated man" and sent investigative reporters after him, as he is trying to replicate his strategy with Argentina.
Dart moved to offshore investment paradise Cayman Islands 13 years ago after his Sarasota mansion burned down in what he alleged was arson. He dropped his U.S. citizenship-some say to avoid paying taxes-and became a citizen of Belize and Ireland. Six years ago, he applied for Cayman citizenship.
He now keeps to himself in a heavily guarded compound on Grand Cayman, never appears in public (which isn't easy, given his prominence on the small islands), and at one point reportedly considered living on his armored yacht.
Although he rarely appears in the Sarasota media, the Dart name is omnipresent on Cayman. His companies sponsor Rotary Club auctions, contribute to hurricane recovery charities, donate millions to build parks that bear his name, and in June, one of his companies proposed to manage the main island's landfill.
His biggest contribution so far: Dart Realty Ltd. last year broke ground on a 500-acre, master-planned community called Camana Bay. The New Urbanism-style city-some locals call it Dartland-is the biggest development ever on Grand Cayman, population 40,000. Camana includes a town center, several office buildings, a six-screen movie theater and the K-12 Cayman International School.
The Cattleman Employees of Cuba's communist government are exceedingly rare visitors in the farmland between Myakka City, Bradenton and Parrish. Yet two years ago, Jim and Renee Strickland hosted a small group of Cuban large-animal veterinarians at their ranch in east Manatee County.
The visit was part of Cuba's efforts to rebuild its depleted cattle herds, and the outcome of a trip to Cuba Strickland took with Naples cattle broker John Parke Wright IV in 2004. (Strickland is also the secretary of the Florida Cattlemen's Association.) During the trip, Wright signed a letter of intent with state importer Alimport SA to purchase 500 U.S. cattle; the Stricklands shipped a first batch of 27 head last year, after the Cuban veterinarians inspected their herd.
But the deal has stalled because of the Cubans' insistence on having their cows test negative for the Bluetongue virus. A Canadian strain of the virus can affect cattle, but the Florida strain, while using cattle as a carrier, only affects sheep. For a shipment of 15 cows, the Stricklands had to perform 150 tests at $250 per head, which Jim calls "cost-prohibitive." He describes Cuban cattle experts as open-minded, and he is convinced the problem will be resolved, since every country in Central and South America has waived Bluetongue testing requirements for Florida cattle. The issue is being complicated, however, by the Bush administration's blocking of travel, both by Cuban government officials to the United States, and of U.S. experts to Cuba.
The Near-shore Expert Sarasota resident Glenn Braverman is in the vanguard of a new trend in the call center business: going from offshore to near-shore. Operating call centers in Asia may look cheaper, Braverman says, but there are hidden costs: so-called "accent neutralization programs" haven't succeeded, and the time difference makes for odd work shifts.
Caribbean call centers operate with higher labor costs, but thanks to the omnipresence of U.S. cable TV, Caribbean English speakers have an easier time adopting the American accent, Braverman says. The time zone isn't an issue, and the operating cost is still half that of a U.S. call center.
Braverman set the standard for multi-ethnic telemarketing as an executive with MCI in the 1990s. After a stint in Japan with Time Warner, he joined a former colleague from his MCI days to become a minority partner in International Market Access Inc. IMA builds call centers in the Caribbean, operates them until they are running smoothly, and then sells them to large companies.
The partners have so far focused on two relatively wealthy, English-speaking islands in the eastern Caribbean, Barbados and Antigua. The next project is slated for St. Kitts.
On these small islands, a small company such as IMA can be one of the biggest fish in the pond. In Antigua, for instance, IMA is the largest private employer. Although most English-speaking Caribbean nations have stringent labor laws, Braverman says he can't complain about his experience with government.
The next project on the horizon may be a call center in nearby St. Lucia. But IMA's big thing will be to go continental and bilingual. Braverman is currently scouting for locations in Panama, Costa Rica, El Salvador and Guatemala. Central America offers a bigger pool of workers with a "stronger work ethic" than on the islands, he says.
The Inbound Guy Colombia native Jorge Chacón, who owns Sarasota-based trade consultancy Jorolco International Ventures, is organizing "Pasaporte USA," a one-day conference and trade fair in July 2007. His ambitious plan is to bring 250 company executives and millionaires from South America, the Caribbean, Spain and Portugal to Sarasota, to listen to local experts talk about immigration law, the real estate market and other investments, and match them with potential business partners in Florida.
How does he think he can achieve that? First, he says he is marketing the event in many countries. But his main rationale is that traditionally, Latin and Caribbean businesspeople have used Miami as their bridgehead, using services of, and forming alliances with Florida companies along the state's east coast. Chacón bets on a kind of novelty effect, as the Gulf Coast is still largely untapped by this foreign clientele.
"The hidden appeal is they can go and see a different place," he says. "Thousands of well-heeled Colombians and Venezuelans own condos in Miami. They know Fort Lauderdale and Orlando. But they haven't been to this area."
To be sure, the planned Sarasota event is Chacón's Plan B. He canceled Plan A, a conference scheduled for Colombia's capital Bogotá early this year. He says he had already signed up a significant number of U.S. businesspeople, including many from Sarasota-Bradenton, to accompany him. But when he heard that a Miami competitor only attracted 30 Colombian businesspeople to a similar event in Bogotá, in spite of a sizable marketing budget, he decided to pull the emergency brake.
The Cuban Lawyer Alberto Pavón came to Sarasota from Cuba with his family three years ago, thanks to the U.S. visa lottery. Ever since arriving here, Pavón, once a prominent lawyer on the island with an M.B.A. from the University of Barcelona, Spain, has been struggling to market consulting services to U.S. companies interested in Cuba. By now, he has figured out that this may take longer than expected: Cuban business in the United States, even in Florida, is still in its infancy. To be sure, some sizable transactions are happening. Since Congress in 2000 exempted food and agricultural sales from the 44-year old embargo, the United States has sold close to $2 billion in goods to become Cuba's 10th largest trading partner. However, the trade is one-way, cash-only, and the U.S. Treasury Department often disrupts exports by imposing surprise rule changes. And investments still are prohibited. Pavón currently advises Cuba Trade & Investment News, a Sarasota-based monthly (the writer of this story is its editor) on editorial issues. But until the U.S. president signs a law that lifts the embargo, Pavón will have to park his skills, connections and knowledge elsewhere to make a living.
The Developers It all started with fishing trips. Mike Carter, founder of Manatee County's largest commercial construction company, Mike Carter Construction, had been vacationing in Costa Rica for 25 years before he made his business move.
Two years ago he bought 18 acres of land near Costa Rica's central Pacific Coast, two miles from a national park that is a prominent destination for eco-tourists. His Bradenton-based Rocky Bluff Properties is now developing La Reserva de Manuel Antonio, a gated community perched on 11 acres on a mountain ridge with ocean views.
As of June, Carter had sold 10 of the 19 units. The buyers are all from the United States, most of them from Florida. Carter puts the sellout value of the project at $25 million. Yet the key word is fun.
"It gives me opportunity to spend time in Costa Rica regularly," he says. "I'm investing millions in the initial infrastructure, so it's not a hobby. But it's very rewarding personally."
Real estate values along Costa Rica's Pacific Coast have been escalating by 20 percent annually, and the area is fairly accessible. Foreign homeowners have to fly to the international airport of the capital San José, and then take a 25-minute commuter flight to Quepos airport. The other option is a picturesque three-hour drive on the Pacific Coast highway through mountains and coffee plantations.
There haven't been any bad surprises, and Carter is fairly certain to proceed with his next project: another gated community on the remaining seven acres, overlooking the future Quepos marina, closer to the sea.
Meanwhile another Sarasotan, Fritz Mayr, has opened up shop off the beaten track, close to the Nicaraguan border, some 120 miles north on the Pacific Coast from Carter's project. The owner of Sarasota-based Overseas Realty began small in 2001, with four rental properties he bought and built at Playa Flamingo in northern Guanacaste province in Costa Rica. The airport at the provincial capital of Liberia just underwent a major expansion, and airlines have begun direct flights from Orlando, Houston and Atlanta. So now Mayr is managing and brokering a 600-acre development called Finca Mostrencal near La Cruz for U.S. partners.
Mayr says he learned Spanish to become familiar with local regulations, and now he is working with local consultants and lawyers to take care of the zoning and master plan for the project. He expects some of his clients to be Germans for whom the United States are becoming a more difficult asset protection territory.
Mayr says he will slowly retract from the Florida market once his Costa Rican business is up and running. "With the prices in Florida, the risk in development here has become too high for my taste," he says.
The Lost Sons Juan Artigas and Alex Chávez are part of a new Cuban-American phenomenon. Both Sarasota businessmen were born in Cuba, both came to the United States as children when their families fled the revolution, and both recently returned to Cuba for the first time in decades, without the approval of their parents who have sworn not to return as long as Fidel Castro is in power.
"I was raised under the hard line," Chávez says. "You're a traitor if you go to Cuba. I actually believed it for the most part of my life. But at one point, I realized that the strategy hasn't worked for 40 years."
Not surprisingly, both are quite emotional about their return trip. Chávez tells stories about his February visit to Cuba, including how he remembered the old fridge and the pictures that once hung at the two bleached spots on a bedroom wall in his parents' small flat in Old Havana.
Both Chávez and Artigas want to combine business with their rediscovery. Before their trip, they applied for and received a license from the U.S. Department of Treasury for their EMRN Group Inc. to sell agricultural products and food to Cuba. During the visit to Havana, they met with a young purchasing executive of state food importer Alimport SA to gauge the Cubans' interest in U.S. products. Artigas and Chávez are now trying to line up Florida and U.S. companies interested in selling produce, baby food or tomato paste to Cuba.