Developer unveils plan for Cayman Enterprise City

If legislators can quickly amend a host of laws that will
allow for the creation of a special economic zone in the Cayman Islands,
developers say they will have companies operating under licences by the third
quarter of this year.

In what was the first of several public presentations,
Hon Development Company LLC gave a press briefing to Cayman’s business leaders
at the Chamber of Commerce on Thursday, 24 February to give more details about
the proposed six-tiered, knowledged-based special economic zone that will be
called Cayman Enterprise City.

Project CEO Jason Blick conducted the briefing, but Barry
Hon and his son Darrell Hon were also both present and added comments.

The elder Hon, who has been developing for 50 years and
has the 2,800-acre Foothill Ranch in Orange County, California, on his list of
successful developments, said there were several reasons why Cayman made sense
for the creation of a special economic zone. He said being in the same time
zone as the US east coast, as opposed to the 12-14-hour time difference with
the Middle East special economic zones, was a huge advantage. He said the
current spreading turmoil in the Middle East was also a reason companies would
come to Cayman.

“We think we’ll bring a lot of those companies there now,
here,” he said. “It makes a lot of sense for them to move here.”

In addition, Mr. Hon said Cayman is a good place to live,
with great weather, great restaurants, friendly people and other positive
attributes.

“It’s the best place in the Caribbean in my opinion.”

Mr. Hon said Cayman has the advantage over places like
the Bahamas – which already has a special economic zone – because it is a UK
territory and has British Law that “you can depend on”.

Mr. Blick, who originally trained as a solicitor, moved
to Dubai in the 1990s and worked with other special economic zones in the
Middle East and Asia from 1999. Cayman Enterprise City will be modelled – on a
smaller scale – on the special economic zones in Dubai. He said there are some
3,000 special economic zones in various parts of the world, but only 1 per cent
of them is focused on technology and knowledge.

Cayman Enterprise City would comprise six parts – an
Internet Park, a Biotech Park, a Media Park, a Global Commodities Park, an
International Academic Park and an Outsource Park. No manufacturing or
engineering will take place in Cayman Enterprise City, and companies licensed
to operate in the zone will not be allowed to trade within the Cayman Islands
and will instead be globally focused, Mr. Blick said.

“In some ways, it will be a country within a country.”

Benefits to the companies licensed to operate in Cayman
Enterprise City would include no income taxes, no corporate taxes, 100 per cent
foreign ownership, 100 per cent repatriation of profits, reduced work permit
fees and no import duties on most items. 

The Cayman Internet Park would attract Fortune 500-brand
companies like Oracle, IBM, HP and Microsoft and would focus on sectors like
software, internet and multimedia, telecommunications and networks and IT
services. Mr. Blick said that in 2007 Oracle wanted to move an operation of 40
people to the Cayman Islands but encountered too much bureaucracy and
Immigration restrictions and decided against the move.

“They said it was just too hard,” he said, adding that
Cayman Enterprise City would eliminate the roadblocks for companies like Oracle
to move here.

“They will come as they have come to many other places,”
Mr. Blick said.

Cayman Media Park is envisioned to become “the global
media heart of the region where all media-related businesses will thrive and
coexist”, Mr. Blick said.

“Strategically located at the crossroads of Americas,
Cayman Media Park will help transform Cayman into a world-class knowledge-based
society and economy,” he said. “In respect to this vision, Cayman Media Park
will establish a world-class environment for every kind of media business,
which broadly includes media and advertising services, publishing and music,
film, new media, leisure and entertainment, broadcasting and information
agencies.”

Mr. Blick said people wondered who would come to Dubai
Media City when it was created, but that there are now 10,000 jobs in that
special economic zone.

“With advanced infrastructure, support services, freedom
of capital movement, tax-free income and easy access to markets rich with
untapped opportunities, the Cayman Islands and Cayman Media Park is the ideal
location for productive media businesses,” he said.

With the Cayman Global Commodities Park, the aim is to
create the Caribbean’s first commodities exchange, rivalling the large
exchanges elsewhere.

“Cayman Enterprise City will be the first special
economic zone in the world to house commodities teams,” Mr. Blick said.

Cayman International Academic Park would consist of five
small universities that would offer access to higher education in specific
areas of expertise needed in the operations of Cayman Enterprise City. Mr.
Blick said the Academic Park would give high-end career opportunities to
Caymanians beyond the traditional law and finance-based careers.

Cayman Enterprise City would be built in three phases,
with the first phase creating 150,000 square feet of leasable area and 900 new
jobs. Construction on the first phase would start in the fourth quarter of 2011
and be completed within 18 months. By 2016, the developer intends to build a
minimum of 500,000 square feet of leasable built area, which would create 5,000
direct jobs and another 4,800 indirect jobs in total, Mr. Blick said.

The developer would make a $25 million investment in the
project in 2011 and a total investment of $327 million.

However, Mr. Blick said the real value of the project to
the Cayman Islands would come from the economic activity that would be created
by the zone after it was built, which would account for 15 per cent of Cayman’s
Gross Domestic Product.

“It will become that third pillar of the economy,” he
said.

In order to set up the Special Economic Zone, a host of
laws would need to be amended, including the Companies Law, the Local Companies
Control Law, the Trade and Business Licensing Law, the Immigration Law, the
Patents and Trade Marks Law and the Customs Tariff Law.

If a definitive agreement with the Cayman Islands
Government were signed and the laws amended by the second quarter of 2011,
operations would commence during the third quarter of this year even though the
zone would not be built yet. Darrell Hon explained that there are already
enough companies that have expressed their intent to establish in Cayman
Enterprise City that they would be put into temporary existing offices until
new space could be built for them.

Mr. Blick said the location of Cayman Enterprise City
would be somewhere east on Grand Cayman, but he would not be any more specific.

Mr. Blick said the aggressive time line for the project
was in place partially because the Cayman Islands Government wanted it to move
ahead quickly, but also because other countries in the region have the same
idea. He said the government of Barbados recently announced plans to create a
special economic zone based on technology.

“Either we do this project or someone else will do it,”
he said.

12 COMMENTS

  1. Another city on Grand Cayman – when is enough just enough? And what Caymanians will be benefiting from this? I guess you have to decide what you are, Cayman, either a lovely Caribbean island or an industrial complex high rise, high population city which happens to be on an island.

    Kiss tourism good-bye!

  2. Personally, being a skeptic rather than opportunist, naturally I would do nothing but scrutinise the article but in this instance a person of my calibre (without sounding too audacious) – educated professional in my field I see a tremendous advantage to the rest of the countries in the Carribean and great opportunities.
    This project will not only improve and frankly give boost to the global view of the Cayman Islands on the global arena, improve the economy and will become the third pillar for the country but also give vast number of opportunities for the people of Cayman, existing businesses. Moreover, it will help young Camanians pursue great education without having to leave the island! Our kids can stay with us and bring growth and development to their own country with growing their own sets ofskills in different areas- this is truely an excelent opportunity – exactly what Cayman needs! The project will global investors and big international players that Cayman has been unsuccessfully trying to achieve previously (Oracle, etc). This could be huge!

    I truely hope it will work for the people of Cayman and help solve the unemployement rate in the country -given the experience and knowledge base of the people involved in the execution of this project it has all the potential.

  3. Hmm….what a tangled web.

    It appears that Hon Development Company is already here, according to their recommendation of Build (Cayman) Ltd. (http://www.buildcayman.ky/references/hsbc-1.pdf

    I wonder if any of the personnel have ties to anyone currently in government. http://www.buildcayman.ky/personel.html

    Moreover, why, as a professional, would you put your references that support your Appliation for Permanent Residency online??

    http://www.buildcayman.ky/personel.html (Look under references)

  4. This project has nothing but upside for Cayman. It involves no government expenditure, will lead to the creation of a substantial number of jobs for Caymanians, will boost Caymans reputation internationally, and will bring in high value investment and people.

    Cayman desperately needs to diversify and grow its economy, and it cannot do so in manufacturing because costs here are simply too high. The answer must be to develop skills and knowledge-based businesses. This kind of development is exactly what Cayman needs to be aiming for.

    Baffled – exactly how is this project going to adversely impact tourism?

  5. It is important for readers to remember to question the sources of information that an article uses. This article is summing up a presentation given by developers – it is in their best interest that this sounds like a great idea. Mr. Hon and Mr. Blick are not being objective. That is not their goal, their goal is to sell this idea.

    Just something to keep in mind… Until there is an objective commentary on this plan, I am keeping my judgment to myself.

  6. To JTB, apart from people on cruise ships, what quality tourists want to come to an over-developed island with a dredged North Sound, an Enterprise City, and lets not forget the oil refinery idea? Doesnt sound exactly bucolic to me – they can go to Miami or Tampa for a lot less.

  7. The point is, government and their backers are getting something off of this! What happen to those lowly ones in the private sector? Where are their share of the pie???

  8. Baffled, if you read my comments on this site you will know I do not support either the dredging of the north sound or the (frankly ludicrous) scheme for an oil refinery.

    The enterprise zone is something different, it will be low impact on the environment – just office buildings – but has the potential to really boost and diversify the economy, and to create real jobs for Caymanians.

    It has to be done right yes – the site needs to be carefully chosen and the development planning closely watched to make sure that what is built is sympathetic. But I have to say, look round Cayman and you wont see much nice architecture – most of it was thrown up on the cheap and in a rush post Ivan – this could be a chance to go one better and build something that enhances the Island.

  9. Hey,

    Dont worry about the Oil Refinery. Big Mac ate too much of something last night.
    HE KNOWS VERY WELL HE WILL NEVER EVER GET AWAY WITH AN OIL REFINERY ON THIS ISLAND. THE DANGERS OF THE ENVIRONMENTAL IMPACT ARE SURPASSING HIS IMAGINATION AND HE NEEDS TO JUST CHILL AND FORGET ABOUT IT.
    IT WONT HAPPEN.

    People will suffer from pulmonary diseases, cancer, and other complications. We can not allow this to happen

  10. Having lived in Dubai for a year, I can tell you first hand that these cities are 90% empty and a waste of money and space. Cayman does not have the space to waste…nor the money. Cayman used to be a beautiful set of Islands. Why are we trying to make it another concrete jungle?!

  11. This project will only enhance the reputation of Grand Cayman as a place with both great natural beauty, and a forward-thinking , well-educated population. I sincerely hope that all in the government pull together to make this happen. If Cayman doesnt do it, another country will. I hope to relocate to Cayman in the next few years (too much snow up north!), and I see this economic zone as a strong driving force in the economy, helping property values recover and providing much needed jobs for those who want to work.
    Another point- with all the sunlight, one would think it easy to live off the grid of electric power. Perhaps the new buildings in the economic zone could be truly green, harnessing the power of the sun for electricity, and geothermal cooling for comfort. You can do it!

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