Investing In Commercial George Town

The Cayman Islands, a British Overseas Territory in the Caribbean, remains the prime destination for savvy investors seeking to diversify their portfolios. Among the various investment options available, buying commercial property in the Cayman Islands stands out as an attractive choice. This article explores what makes this sector so captivating and the reasons why top investors have chosen this picturesque island as a highly advantageous investment destination.

Favourable Tax Environment

One of the most alluring aspects of investing in the Cayman Islands is its favourable tax environment. The absence of direct taxes on income, capital gains, and corporate profits creates an inviting space for businesses and individuals and significantly enhances the profitability of commercial investments, making the islands a desirable choice for real estate ventures. 

Strong International Presence 

As a leading international financial centre, the Cayman Islands offer a thriving financial services sector that attracts businesses, professionals, and investors from around the globe. The demand for office spaces and other commercial properties is bolstered by the presence of international banks, law firms, accounting firms, and investment funds. This ecosystem creates a symbiotic relationship between the financial services sector and the demand for commercial real estate, regularly resulting in consistent rental income and property appreciation. 

Situated at the crossroads of international trade routes, the Cayman Islands cultivate exceptional connectivity. The Owen Roberts International Airport provides direct flights to major global cities, facilitating business travel and fostering accessibility for potential clients, partners, and investors.

The Cayman Islands commercial sector brings numerous advantageous realities! Its blooming capital, George Town, is quickly becoming one of the most investable areas among the three sister islands. 

Lack of Supply Meets High Demand

Limited supply of land due to the islands' geographic constraints can contribute to the appreciation of property values over time, resulting in commercial property in prime locations such as George Town to remain a valuable asset. As demand continues to grow, investing in commercial real estate presents the potential for substantial capital appreciation in addition to regular rental income. 

Opportunity

While the priority of condominium developments has caused land values to increase in areas such as West Bay, Prospect, and Grand Harbour; the focus has shifted to George Town’s traditional commercial use class where values remain reasonable and at a level where development appraisals are still producing favourable results. Where inflated capital values have taken hold in these other areas, George Town has lagged behind, though that is about to change. 

Revitalisation

The Government’s holistic Revitalisation initiative has started to take effect with the pedestrianisation of Cardinal Avenue and plans to expand this further in the future. 

Additionally, the flourishing of George Town continues with the game-changing ONE|GT, a mixed-use hotel and residence with Cayman’s first-ever sky bar, which is well under construction and due for completion in Q1 2025. Similarly, Cricket Square continues to build on its success as the premier office destination on the island, developing two new 8-storey office buildings, the first of which is also due for completion in Q1 2025. 

Camana Bay

Camana Bay is always a question that will be asked when prospective purchasers are looking to invest in George Town. It’s certainly something you cannot escape, as it is now the largest private development on the island with continuing growth. The largest impacts were felt upon its opening 15 years ago, however, I have noticed it created two major trends that facilitate George Town as a strong investment product.  

1. George Town’s commercial tenancy profile has changed significantly over the last decade, resulting in the vast majority of tenants being Government entities and law firms. Both offer great security of tenure because of their operational nature and locational capacity. George Town will always remain the home of these firms because of the proximity of the Government Administration Building and the Courthouse.

2. When Camana Bay opened - and began driving up office rents with newer buildings and greater amenities - it changed the office market. George Town became a product which represents value engineering for any company. I have tracked how the gap between the occupational costs has remained the same, regardless of how high Camana Bay tries to increase rents. This means George Town is organically increasing in value because as an alternative, it will still always offer an attractive value that some companies will elect to benefit from.  

Time For Change

With future revitalisation initiatives, George Town is beginning to transition its focus on the booming international overnight tourism in which people will begin to live, work and shop in a way that they haven’t for 15 years. The current discount on market value shown on land and buildings, coupled with the stability and security of income that these assets provide, George Town presents a unique opportunity but a limited time frame to take advantage.

IRG’s 25 years of experience covering the market positions us perfectly to help you navigate the best opportunity. We can assist you in leveraging these advantages, so you can position yourself to benefit from the Cayman Islands' flourishing economy and promising real estate market. 

FAQs

1. Why George Town is Ideal for Commercial Property Investment in the Cayman Islands?

George Town, the bustling capital of the Cayman Islands, is emerging as a prime location for commercial real estate investment due to its limited land availability and increasing demand. This shortage leads to the appreciation of property values. Additionally, revitalization projects, such as the pedestrianization of Cardinal Avenue and developments like ONE|GT, make this area even more attractive for investors. Investing in George Town commercial property offers long-term, stable rental income as many government offices and law firms choose this area for their headquarters.

2. How does the Cayman Islands’ tax structure benefit commercial property investors?

The tax structure of the Cayman Islands is one of the top reasons investors flock to this Caribbean paradise. There are no direct taxes on income, capital gains, or corporate profits, making commercial real estate investments in George Town highly profitable. This tax advantage draws international businesses and individual investors, offering significant investment returns, especially in prime areas like George Town.

3. What are the trends in commercial property values in George Town?

Commercial property values in George Town are steadily rising, but they remain lower than those in areas like West Bay or Grand Harbour. The ongoing development projects and revitalization of George Town are expected to drive up property values, making it the perfect time to invest. For savvy investors looking for capital appreciation and rental income, George Town commercial real estate offers a great investment opportunity before the prices catch up.

4. How do developments like ONE|GT and Cricket Square impact George Town’s investment potential?

New developments, such as ONE|GT and Cricket Square, are transforming George Town’s commercial real estate market. These modern projects, set to be completed by 2025, will attract high-profile businesses and increase demand for office spaces. As a result, commercial property investors in George Town will benefit from both consistent rental income and property value appreciation, making these developments a key factor in boosting George Town’s appeal.

5. How Camana Bay Impacts George Town’s Commercial Property Market?

Camana Bay has significantly impacted the commercial property market in George Town. While Camana Bay drove up office rents with its modern buildings and amenities, George Town remained a cost-effective alternative for many businesses, particularly law firms and government offices. The steady rental price gap between the two areas has made George Town commercial real estate a highly attractive investment option for companies seeking affordable office space without sacrificing location or accessibility.