Ronan McMahon

10 min to read

Jan 2024

The Dominican Republic’s Surprise “Caribbean Cabo”

Market Watch

“I’ve never seen sands so white, or waters so quintessentially Caribbean, than at Cap Cana.”
©AHДEPЙ ДAHИЛOBИЧ/iSTOCK

As dawn breaks, your community awakens to a symphony of nature. The first rays of the sun cast a golden glow over pristine beaches and meticulously manicured landscapes. Step onto your balcony, and you find the air once again fresh and invigorating, a perfect blend of sea breeze and tropical warmth.

You savor mornings in this paradise. Usually you take a towel and stroll to the beach. The paths wind through lush greenery, with glimpses of azure water. Fellow early risers nod in friendly acknowledgment, a testament to the close-knit and welcoming community that thrives here.

Each day here presents new opportunities and experiences. Today, with the tang of salt still on your lips, you’ll breakfast at the marina—a hub of activity where many expeditions begin, from deep-sea fishing to exploring the nearby coral reefs. You always go for the fresh fruit and a local specialty omelet with delicious Dominican coffee.

Then it’s golf… or fishing… or horseback riding… You have so much to do. Last week, you took a day trip to explore the coffee highlands in the Dominican Republic’s interior.

Lunchtime is an opportunity to socialize with fellow expats and locals at one of the many beachside restaurants in your community. The conversation flows easily, a mix of languages and accents, stories from different corners of the world, all converging in this little piece of paradise. The menu offers fresh seafood, a staple here, prepared with local herbs and spices.

As the afternoon approaches, the pace slows down. It’s time for a siesta, or perhaps a leisurely stroll to visit local art galleries and boutiques, each offering a piece of Dominican culture and craftsmanship.

This is Cap Cana, an out-of-this-world luxury beach and golf community on the pristine shores of the Dominican Republic. A place where my team and I are digging deep for real estate deals…

Scouting the Caribbean

In 2022, I took my first scouting trip to the Dominican Republic in nine years. I knew it would be worthwhile.

I’ve long kept an eye on this Caribbean country. After Mexico’s Riviera Maya (No. 3 on The 20 Best Places to Buy Real Estate), the Dominican Republic gets the most tourists in the entire region. And just like Mexico’s Riviera Maya, the Dominican Republic has seen a huge surge of visitors post-pandemic, thanks in no small part to its easy access from the US.

The country is smashing tourist number records. Last year, “the DR,” as many folks call it, welcomed 14% more international visitors in 2023 than it did in 2019—marking its best tourism year on record. That’s more than 10 million travelers. A first for the Dominican Republic.

According to air travel intelligence provider Forward Keys, airline ticket bookings to the Dominican Republic for January to March of 2024 are already 56% higher than during the same period in 2019.

Most of these arrivals go to Punta Cana, easily the country’s biggest destination. Like the Riviera Maya, Punta Cana has been benefitting from a decades-long Path of Progress that began here in the late 1960s, when it was discovered by a group of investors who started acquiring and developing beachfront land.

Development is tearing ahead in the Punta Cana area now. And this is where you’ll find the stunning master-planned community of Cap Cana, where I’m currently focused on finding deals for members of my Real Estate Trend Alert (RETA).

I’ll tell you more about Cap Cana in a moment. First, let’s look at how the Dominican Republic is growing and developing…

The country is the second fastest-growing economy in the region behind Panama. (Panama is another firm favorite on my RETA beat.) From 2015 to 2019, the DR grew at an average rate of 6.1% per year, compared to the region’s average of 3.1%. The economy is wide-open to foreign investment, and the country’s becoming the greatest recipient of Foreign Direct Investment (FDI) in all of the Caribbean.

According to one research report from the UN World Tourism Organization, “the figures of greenfield investments of FDI show that the Dominican Republic has attracted more than 26 projects, receiving nearly $5.7 billion in tourism capital investments in the region between 2016 and 2020.”

That’s just behind Mexico.

Consider the rest of the Caribbean for a moment. There are 700 islands, reefs, and cays here. Even for this seasoned traveler, that’s too many to cover…

That’s why for years I assigned my senior researcher Margaret Summerfield to various parts of the Caribbean in search of the best opportunities.

Her findings were mixed. For a deal to have potential for my RETA group and me, there needs to be a clear path to profit, be it through capital appreciation, income, or both. And every time Margaret reported back from a trip, we came to the same conclusion.

Nothing touches Mexico’s Riviera Maya in terms of opportunity.

It’s a drum I’ve been beating loudly for many years now. I’ve put my money where my mouth is, buying alongside my RETA members. And time and again, the results have spoken for themselves.

Now though, having put my boots on the ground again in the Dominican Republic and done a lot of research, I’m finally as excited about a Caribbean destination…

Introducing Cap Cana

The Dominican Republic is big, with a lot of stunning coastline. But my team and I are focused on one corner… the most luxurious and best-served in the country.

At 30,000 acres, the master-planned community of Cap Cana is twice the size of Manhattan. And it’s just 20 minutes from the Dominican Republic’s Punta Cana International Airport, with regular flights across Canada and the American northeast.

Everything in Cap Cana screams luxury. I scouted here twice last year, meeting with developers to negotiate deals I think are good enough for my Real Estate Trend Alert members. Plus, three members of my team stayed in Cap Cana to explore every nook and cranny.

Cap Cana has top-tier golf courses, a pristine marina, sports fishing, shopping complexes, upmarket restaurants, a hospital, and a bilingual school.

Then there’s the stunning beach. Brilliant and arresting, with bright Caribbean waters against an expanse of sand. I’ve never seen sands so white, or waters so quintessentially Caribbean, as at the Juanillo Beach Club in the heart of Cap Cana.

I think of Cap Cana as a sort of mini “Caribbean Cabo.” Just like in Cabo, you have a top-end marina, incredible golf, and world-class sportfishing. The market is similar to Cabo in terms of demographics and wealth, though Cap Cana understandably draws folks mainly from the East Coast of the US and Canada.

It even has a beautifully manicured Jack Nicklaus signature oceanfront golf course and a new St. Regis hotel… just like the five-star Quivira resort where I have my condo in Cabo.

This is where I’m drilling down to find deals. Deals I believe are set to benefit from the explosive growth of the Punta Cana region and the Dominican Republic.

Get the right deal and get in early on incredible Caribbean luxury, and we stand to do very well indeed.

WHERE MY SCOUTS AND I ARE HEADED NEXT…

I’m getting the gang back together. At the beginning of February, I’m bringing my far-flung team of scouts to a stunning stretch of Costa Rican beach.

We’re meeting for a few days to map out our global scouting strategy for 2024. We’ll discuss the best places to buy real estate in the world. The “next places” to get our boots on the ground.

But we could meet anywhere. There’s a good reason I’ve chosen the province of Guanacaste in northwest Costa Rica.

Way before Costa Rica’s tourist boom, the sunny northwestern province of Guanacaste was a sleepy region of cattle farms, empty beaches, and good surf breaks.

It fit the bill if you were looking for a little fun in the sun—a lazy vacation where you could kick back and unwind—but getting to this idyllic spot took some doing. The road from the capital was in bad shape. It was a bumpy ride that took four or five hours. The alternative was to take a prop plane.

Whichever option you took, it set you up for the lack of frills when you arrived.

But a savvy group of hotel and real estate developers could see the appeal of this endless-summer location. The Four Seasons pumped more than $200 million into carving out a top-quality golf course, rooms and suites, and hillside villas with private plunge pools. They needed tourists to fill their luxury rooms and pay their premium rates.

A bumpy dirt track or a prop plane simply wouldn’t cut it…

The road from San José was soon paved, and the airport at Liberia, the provincial capital just 30 minutes from the coast, was expanded and upgraded. In 2002, regular direct flights to the US started. In 2003, Liberia airport saw 50,000 passenger arrivals. By 2022, the number had topped 1.3 million. Along the way, this region earned the nickname… the Gold Coast.

In 2002, investment in residential development in Guanacaste began outstripping investment in tourism. Developers poured into the market, snapping up the best pieces of land. In the three years after those regular direct flights began, prime beachfront land tripled in price.

Visit this part of Costa Rica today, and you can stay in fancy hotels with five-star service and five-star amenities. The Four Seasons was joined by JW Marriott, Andaz, and the Westin. In any number of towns across the region, you can play golf, relax in a spa, and dine in chic restaurants. These days, the area south and west of Liberia airport is highly developed. And home to not just high-rise condos but also fancy gated communities.

In short, this is no longer a low-cost destination, whether you’re heading out to dinner or buying a home.

But there’s still major potential for future development in Guanacaste, particularly in the central coast and in the largely undeveloped area north of Liberia.

I expect the next phase of the region’s development to be focused on these regions, and investors who get in on the ground floor could profit handsomely. That’s why I’m putting all my scouts on the ground here in February. I think we’re close to some killer deals here. Keep an eye out.

Ronan McMahon is IL’s international real estate expert. If you’ve been thinking of buying a rental property overseas, but could use help with your search, learn about Ronan’s Real Estate Trend Alert. Thanks to group buying power, members get access to best-in-class properties in the right locations—often at below-market pricing.