Celebrities and rich people plot to turn Cuba into tourism hell

Celebrities and rich people plot to turn Cuba into tourism hell
By Associated Press October 15, 2015 | 11:44am

HAVANA — By midnight, the basement of one of Havana's hottest clubs is
packed wall-to-wall for a private concert by one of Cuba's biggest pop
stars.
Squeezed among the usual crowd of sleek young Cubans and paunchy,
prowling European tourists, the owner of one of New York's hippest
restaurants discusses his new Havana boutique hotel project. At the bar,
a Swiss venture capitalist describes meeting with Communist Party
officials about partnering on a marina complex. An Ohio woman who runs a
bespoke guide service for wealthy Americans shows her clients iPhone
photos of the private villa where they will have a waterfront paella
dinner the next day.
The foreigners visiting Havana used to be Canadians and Europeans on
cheap beach package tours and left-leaning Americans on dutiful rounds
of organic farms and neighborhood health clinics. Ten months after the
US and Cuba declared the end of a half-century of official hostility,
the mood in Havana has changed.
The city is filled with celebrities coming to party and hedge-fund
managers sizing up their chances to make millions in one of the last
bastions of communism. As an influx of American cash starts feeling
imminent and inevitable, there's a giddy, frothy feeling in the air, at
least the air breathed by Havana's privileged. While most Cubans remain
on the outside looking in, Havana's high society has a gold-rush,
center-of-the-universe pulse that hasn't existed here since Fidel Castro
stormed down from the mountains in 1959 and threw out the last group of
foreigners who saw Havana as their tropical playground.
"The next big bubble is going to be nightlife. That's what happened to
Cancun," said Ziad Chamoun, a Boston-area restaurant and club
owner-turned-wine importer who was drinking champagne in a waterfront
villa on Saturday afternoon with five friends, including the head of one
of the world's largest emerging-market investment funds.
"We're talking about doing a nightclub here, a high-energy Euro-house
nightclub with DJs, VJs, laser shows, music, dancing," Chamoun said. "We
want to be ahead of the curve, not behind it."
In 2013, a quick jaunt to Cuba by Jay Z and Beyoncé outraged Republican
lawmakers and set off a federal investigation.
In recent weeks, the only reaction to visits by the rich and famous has
been the sound of Cubans rushing to grab selfies with celebrities.
Mick Jagger and Katy Perry partied (separately) here over the last week.
This month's Vanity Fair has Rihanna on the cover, shot by celebrity
photographer Annie Leibowitz in Havana. Mexico City's hottest chef is
scoping out sites for a Havana restaurant. Usher and Ludacris have shown
up. Jimmy Buffet played a private backyard concert for friends.
The tour companies showing the Americans around Cuba have sprouted
investment consulting arms. And Cubans with money and foreign backers
are furiously rehabbing old homes into micro-hotels complete with
high-end restaurants and conference rooms for business meetings.
"New Year's is the day all of Havana commemorates the Cuban Revolution,"
one North Palm Beach yacht charter broker wrote to clients last week in
an emailed pitch for trips to Cuba. "Call today so you don't get stuck
having to go to St Bart's (again), or Aspen (again)."
Hannah Berkeley Cohen first came to Cuba to study Marxism and Leninism
on a study abroad program for the University of Pittsburgh. After
working as a freelance journalist and guide for clients she describes as
"lefty, self-identifying socialist Democrats from New England," she now
spends at least three weeks a month taking groups of moneyed Americans
on rounds of Havana's clubs by night and crumbling housing stock in
search of real estate investment opportunities by day.
"The clientele now have the best new idea that will make millions in
Cuba," Cohen said. "Everyone wants to get here before everyone else gets
here."
The sprouting of high-end clubs and bars around Havana is unsettling to
many in Cuba who grew up believing in equality as a tenet of the
revolution, and now see foreigners and wealthy Cubans spending many
times in one night the roughly $30 monthly salary of the average Cuban
state worker.
"This change is proving dramatic for a great majority, who had the
mentality that everyone should have access to everything," said Octavio
Borges Perez, a longtime cultural critic for the Cuban state news
agency. "It's shocking for many people that you can now only get into
certain places if you have spending power."
Among the small world of academics and travel guides who focused on Cuba
in the years before the declaration of detente, inside knowledge about
the island's complexities was an obscure and not particularly profitable
asset. Now America's experts on Cuba are rebranding themselves as
blue-chip business consultants.
Collin Laverty heads one of the best-known American companies organizing
the educational trips to Cuba permitted under US rules barring pure
tourism. In July, he created a new business called Havana Strategies to
handle the growing demand for his investment consulting services.
Laverty said he's been flooded with calls from "everyone from folks that
sell pipes to people that sell tractors to these cruise ship companies
to folks that develop hotels, folks that develop triathlons and
concerts. It's incredible, the interest across sectors."
Former Council on Foreign Relations Cuba expert Julia Sweig and Phil
Peters, head of the Virginia-based Cuba Research Center, have founded
D17 Strategies, a consulting firm named for the date on which Presidents
Barack Obama and Raul Castro declared detente last December.
"People who do Cuba, it was always an academic exercise," said Ted
Henken, a Cuba expert at Baruch College who traveled to the island
recently with a former Goldman Sachs managing director looking for
technology investment opportunities. "Now there's a possibility to turn
your knowledge and your network into something that has a practical
economic value and, selfishly, a payoff."
The Cuban government has not announced any big deals with American
companies since Dec. 17, and Tom Popper, the head of Cuban travel
company insightCuba, said a recent conversation with Cuban President
Raul Castro indicated the country will not be welcoming of newcomers.
The two men met briefly at a reception during Castro's visit to the
United Nations General Assembly in New York, and Castro said that "Cuba
continues to place its trust in American companies that have a long
history of working in Cuba," Popper said.
"He explained that friendship and trust is built over time and isn't a
privilege. He said we are off to a good start in this new world, but we
have a long way to go."

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