BAHAMAS Trends and Developments Contributed by: David Johnstone and Nateisha Bain, Lennox Paton
Some of these resorts operate as boutique hotels, while others consist predominantly of fully branded residences. In all cases, branded residences represent the majority of the overall accommodation inventory. Although such residences are typically subject to management agreements with branded operators, together with restrictions on use and ongoing ser - vice charges, fees and maintenance obligations, they remain highly desirable. Owners benefit from turnkey ownership, managed services, access to hotel ameni - ties, participation in rental programmes with income shared between the owner and the operator, and maintenance carried out to luxury brand standards. Purchasers also benefit from property tax exemptions While luxury real estate and branded resort develop - ments continue to dominate headlines, there has been significant growth in condominium and multifamily developments. New Providence, home to the capital city of Nassau, has experienced a recent surge in high-rise beachfront condominium construction. Developers of larger con - dominium projects may benefit from a government- sponsored value added tax credit programme, which allows VAT paid on construction inputs to be offset against VAT payable on developer sales. Foreign pur - chasers of condominium units or lots are subject to the same VAT transfer tax as Bahamian purchasers on transactions exceeding BSD1 million. and favourable condo-hotel tax rates. Condominium and multifamily boom This trend is driven by several factors, including growth in the professional and expatriate population, particu - larly following the pandemic, and increased investor demand for income-generating and rental properties. While purchasers should carefully consider govern - ance structures, including the balance of control between developers and unit owners and the alloca - tion of shared costs across condominiums, phases or mixed-use components, Bahamas condominium legislation is well established. It provides for strata title ownership, offering owners a high degree of legal certainty.
Some condominiums also form part of condo-hotels with rental programmes, allowing owners to ben - efit from property tax and duty concessions, subject instead to the payment of a condo-hotel tax. However, such arrangements may include restrictions on per - sonal use and ongoing maintenance standards. Residency status available to foreign investors and purchasers Under Bahamian immigration law and government policy, foreign nationals who invest in a Bahamian business or purchase Bahamian property with a mini - mum value of BSD1 million may apply for economic permanent residency. This immigration status has become increasingly popular with foreign developers, investors and purchasers, particularly in the period following the societal impacts of the COVID-19 pan - demic. Residential and condominium acquisitions are fre - quently structured with the objective of securing eco - nomic permanent residency, often as part of broader tax planning strategies. As a result, immigration con - siderations are a key component of many real estate transactions. It is important to note that the grant of permanent residency is not automatic, and government policies may evolve over time, including in relation to eligibil - ity, approval and ongoing maintenance of economic permanent residency status. Airlift infrastructure and accessibility enhancements The Bahamas’ proximity to the United States and Canada has long been a core advantage for both tour - ism and real estate investment. In addition, the gov - ernment has committed to expanding airlift capacity and modernising multiple airports across the islands to meet both domestic and international demand, with a focus on safety, capacity, technology and opera - tional efficiency. Several Family Island airports are being upgraded simultaneously, including North Eleuthera, Deadman’s Cay in Long Island, Cat Island, Black Point Exuma, Georgetown Exuma and South Bimini Airport. The objective is to facilitate direct international flights to
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