After Peg Walsh purchased a second home in Gustavia on St. Barths, she was unsuccessful in listing it with a local renting service, leading her to launch her own real estate company. After a few years, Walsh brought her son Tom Smyth, armed with entrepreneurial spirit, into the operation. Today, after nearly two decades and an affiliation with Sotheby’s International Realty, St. Barth Properties Inc. is a full-service company that represents the most exclusive properties on the island. Smyth, now the company’s vice president, and Walsh share some of the island’s elusive secrets with Haute Living.
Haute Living In the past two decades, what would you say was the catalyst that caused the real estate on St. Barths to burgeon?
Tom Smyth Over the past 20 years, St. Barths has been a subject of increased media attention and the number of celebrities vacationing here has increased as well-which in turn, ups the media focus-and the mystique. It’s the place to see and be seen and to buy a vacation home.
At the same time, there has been a noticeable gain in wealth. This demographic recognizes the attractive nature of St. Barths real estate both as a vacation home and as a solid investment opportunity.
HL Who is the buyer on St. Barths?
TS Age 35-55. There is a mix of family situations and ages of children. The majority of buyers are purchasing their third, fourth, or fifth home.
HL What is the allure of this little island? Why is it more glamorous to own a small villa here than a larger estate on any other Caribbean island?
Peg Walsh St. Barths is unique to the Caribbean. It’s a beautiful island, but I feel its special ambiance is the main attraction. We describe it as casually elegant and as soon you step foot on the island you recognize it. There are so many things that contribute to St. Barth’s mystique including its fascinating history…It has star power but it is as much its Gallic charm that draws people. Most folks here are quite nonchalant about the rich and famous with whom they bump elbows with in the bistros and boutiques. St. Barths is a French island-very much so-with all that implies: fine cuisine, wines, couture, and sophistication. But it is an understated sophistication.
HL Despite the instability of the American market, most home owners on St. Barths are in fact American-is this a sign of immunity for the demographic of buyers or the convenience of proximity?
TS This is more closely related to the financial immunity the demographic of buyers have. The majority are cash buyers with no need to finance their purchase.
HL Villas La Grande Maison des Étoiles and Au Soleil are two magnificent properties that you are currently renting-aside from the Christmas season, are these luxury properties in high demand?
PW Yes they are. If you have four couples at Au Soleil and divide the U.S. dollar cost by four, the villa becomes quite affordable. Much more so than booking four hotels rooms that are priced in euros.
HL As far as sales, when is demand at its highest?
TS The sales cycle closely follows the seasonal rental, with the majority of transactions occurring between November and May. This is a result of simple mathematics. More people visit the island at this time, fall in love with St. Barths, and look to buy a vacation home here.
HL What are some unique factors common only to the island in terms of building/adding on to a property?
TS The local government takes its strict building codes and permitting very seriously. There are height and size restrictions, including the well-known caveat against anything taller that a palm tree. These calculations vary, based upon where on the island the land is located. Example: To build in areas of St. Jean and Gustavia you are able to utilize more of the land area than you would in the domain of Mont Jean.
HL Now that St. Barths is a Collectivity, do you anticipate any changes to the real estate market, aside from the five percent rental tax?
TS We don’t anticipate any major changes to the market except that this may flush out some European owners that may have decisions to make related to their personal tax situations. The American buyers have no need to change their opinion on investing in St. Barths. In fact, the capital gains tax for American buyers has been reduced under the Collectivity.
HL Is fractional ownership popular on St. Barths?
PW Fractional ownership is the same as a time share. Two hotels, Eden Rock and the Isle de France, offer this program. It is not very popular as these are small hotels and they still have blocks of weeks to sell.
HL What is the rental market like in preference of villas and hotel rooms?
PW Many people book a hotel for their first visit. Once they arrive, they fall in love with St. Barths and return year after year. A certain clientele prefers the hotel atmosphere and in turn and will stay loyal to one property. However the majority prefer to stay in one of our private villas. Our villas are priced in U.S. dollars which is an added plus, especially these days.
HL In 2005, St. Barth Properties co-brokered the sale of Gitana Bay for $21.4 million, which set a precedent for the island. Have any properties exceeded the sale of Gitana Bay?
TS At the moment there are opportunities to purchase property exceeding 25 million. Due to confidentially agreements with the sellers we are not able to publicly disclose the properties. We introduce these opportunities to prequalified buyers upon signature of a confidentially agreement.
HL How long was Gitana Bay on the market?
TS Less then three months.
HL What parts of the island are most people interested buying?
TS There is no clear answer to this. It depends on the client’s preference and taste. Some are looking for a specific area say, for example-close to the beach. They are generally looking to match property size, view, sunset or sunrise exposure, and privacy to their tastes and may end up buying in an area of the island they may not have thought they would originally be interested in.
www.stbarth.com
St. Barth Properties, Inc.
800.421.3396
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