At a Glance:
* First detailed interview with Sterling Global’s David Kosoy on the US$650m investment
* Says Cayman can support two more high-end hotels on Seven Mile Beach
* Aims to capture large-scale conference business with a 1,500-person oceanfront facility
*Calls the projects a “win-win” partnership for the country, community and investors
After investing US$650 million to bring two Hyatt branded hotels to the southern end of Seven Mile Beach, it is no surprise that Sterling Global is bullish about Cayman’s tourism industry.
The real estate investment company has become one of Cayman’s biggest developers almost overnight. The company is even moving its corporate headquarters to office space in the new five-star Grand Hyatt, which is close to completion on the site of the old Pageant Beach Hotel, which burned down in 1975.
The developer also plans to raze the old Treasure Island hotel property, a short walk away, and replace it with a four-star Hyatt Centric hotel.
Collectively, the two new resorts will put an additional 700 rooms into the tourism market in Cayman.
In an interview with the Compass, Executive Chairman David Kosoy outlined his belief that Cayman is positioned to go from strength to strength as an upscale destination.
He said stable government, relatively low crime and lack of exposure to geopolitical risk, compared to rivals, made the islands a safe bet for investment. He is confident that there is room in the market for two more high-end hotels on the Seven Mile strip.
Bringing the Hyatt brand back
Kosoy said the resorts would bring new customers to Cayman, boosting visitation rather than competing for market share.
The Hyatt has not had a presence in Cayman since 2007. After Hurricane Ivan severely damaged the inland portion of the Hyatt Regency Grand Cayman resort in September 2004, the Hyatt remained the operator of the “Beach Suites” portion of the property until the expiration of its 20-year management agreement in December 2007.
“They had a strong desire to get back in. They pursued us really,” he said, predicting that the renewal of the relationship would bring new visitors through Hyatt’s global reservation and loyalty system.
Though both are Hyatt brands, the two projects are distinct. Grand Hyatt is Hyatt’s highest tier category and will feature approximately 400 units, roughly half hotel rooms and half condos in the rental pool. Hyatt Centric is positioned as a more modern, lifestyle-oriented brand, with rooftop restaurants and a younger feel.
Kosoy described the relationship as similar to the distinction between Kimpton and Indigo, both owned by the Dart Group, at the northern end of the beach.
Conference niche
He cited the 1,500-person conference centre, directly on the ocean with beach views from the ballroom, as a key feature of the Grand Hyatt project that would attract additional business for the island. It will be the largest conference space in Cayman and is expected to open up new opportunities for the kind of corporate conventions and incentive travel groups that currently go to places like Las Vegas or other large-scale U.S. convention markets.
Unlike existing facilities, he said the Grand Hyatt would be able to accommodate large conferences entirely on site.
“That’s business that probably Cayman wouldn’t have got otherwise,” he said, noting that up to 800 delegates would be able to stay at the property during major events.
He said the resort is already taking bookings and “exceeding expectations”.
Impact of hotel development
Asked about the possible impact of this level of development on the island’s resources and infrastructure, he said Cayman can sustain more air arrivals. He believes high-end hotels are a better bet than cruise tourism.
“I don’t like the cruise business that much for an island … I would prefer room nights.”
On infrastructure concerns, he said both developments would provide tens of millions of dollars in taxes annually to government that could be used for roads and transport improvements, or to help fund upgrades at the airport, including runway and customs processing improvements.
He also suggested collaborative solutions to traffic congestion, such as shuttle buses, to alleviate road pressure.
Beach access
Though the wraparound banner ads that front the accumulating ornate stone wall in front of the Grand Hyatt indicate ‘Seven Mile starts here’, neither hotel is actually on the main Seven Mile strip.
As erosion bites into the southern end of the beach, he views that as an advantage.
The Grand Hyatt, adjacent to the Wharf restaurant, has its own pocket beach, which the developer has expanded with imported sand.
“Our beach is going to be fantastic, but really private,” he said.
The project has attracted some public scrutiny over shoreline construction activity. The developer has said all work on the boardwalk was permitted and the fresh beach will be protected from erosion by the ironshore coastline.
The Treasure Island property, more recently a Margaritaville resort, will be pulled down entirely and replaced with a new structure. It retains access through neighbouring properties to the beach.
Some of the plans for the Hyatt Centric site were revised following objections during the planning process.
In both cases, the developments are on the site of former hotels. The Hyatt Centric in particular is cited as a means of reviving a property that has struggled.
Kosoy said the aim was a ‘better product’ and better, higher-spending tourists, and suggested the area would benefit from the removal of a building he said should already have been demolished.
The company
Kosoy said the company has a history of building marinas and resorts in other areas, including a superyacht marina in the Bahamas, and has long been involved in debt financing and wealth management in Cayman. Cayman is also where its wealth management operations have been based.
The firm oversees more than US$1.5 billion in assets under development across its broader platform.
The decision to get involved in two Cayman hotels was opportunity-driven. Kosoy said they initially entered the Grand Hyatt project as lenders before becoming equity partners as the development evolved.
On Treasure Island, he said this was also an opportunity to acquire a well-located site at a reasonable price after years of following its trials and tribulations.
Cayman strong
Sterling’s leadership believes travel patterns are shifting toward the Caribbean due to geopolitical and lifestyle considerations in North America.
Chief Executive Officer Stephen Tiller said some Canadian travellers are increasingly preferring destinations outside the United States. He believes there is an opportunity to attract Canadian and European travellers outside of Cayman’s traditional US source market.
Kosoy doesn’t see the same challenges in Cayman as other regional jurisdictions, citing instability elsewhere in the Caribbean and cartel violence in Mexico.
He is not concerned about recent immigration reforms and insists the company is already hiring multiple Caymanians in top-tier positions for the Grand Hyatt, which he indicated would likely open in the first half of this year.
“It is Caymanians first to us,” he said. “We have a lot of Caymanians in very high positions in the hotel.”
He added that the developer’s approach was to work with the community.
“It’s got to be a partnership. That’s the way the people win, the country wins, and we win.”
Grand Hyatt Grand Cayman:
Location: Southern end of Seven Mile Beach (former Pageant Beach Hotel site)
Units: 382 total (hotel rooms + condos in rental pool)
Key Feature: 1,500-person oceanfront conference centre
Projected Opening: Summer 2026
Hyatt Centric Grand Cayman
Location: Former Treasure Island/Margaritaville site
Units: 316 total (approx. 152 residences + 164 hotel rooms)
Positioning: Lifestyle-oriented hotel with rooftop dining
Projected Opening: Timeline to be confirmed (early development phase)
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How is the West Bay Rd and what’s left of the beach, going to cope with all the additional traffic generated by these two hotels with some 700 rooms/residences,plus other developments on the beach already under construction?.
Where (presumably underground) and how many spots are available for parking? I feel like there may be some overflow into the crowded Kirk’s lot.
There is limited space on the Sunset Cove beach With 95 units there there will be little to no room for the hotel guests When it was Margaritavile there was not enough chairs on the beach, With so many more rooms in the new hotel the beach is going to be a mad house
Who is going to work the jobs? No one going to clean rooms as a Caymanian for less than $30 an hour. We Caymanians want high paying jobs. It should be $30 per room cleaning fee, not per hour.
There needs to be beach access to this beach. No beach is private. Sounds like he already doesn’t want our people.
Cayman needs one government run Casino for jobs and tourism.
Caymanians are not going to work these jobs, we will have to bring in more entry level labor, meaning more of our housing will be taken up by these individuals, more cars on the road, more people needing healthcare and other support. They will be in competition with our local people to find somewhere to live that is reasonable – this means less change for a Caymanian family to find reasonable house. We need to do things to help Caymanians and building more hotels is NOT the answer.