CB_2018-02-08

THURSDAY, FEBRUARY 8-14, 2018 | VOL. 4 EDITION 5 | WEEKLY $2.00 | © 2018 LATIN MEDIA HOUSE, LLC | CARIBBEANBUSINESS.COM
TOP STORY / PAGE 6 LEAD STORY / PAGE 7
U.S. Congress Eyes
Prepa Privatization
Concerns Remain on the Regulatory Front
P.R. Tax Reform Aims to
Jumpstart Economy
Treasury Bound to Shore Up Tax Base
ECONOMIC OUTLOOK 2018
The Climb
Begins
FULL STORY ON PAGE 10
SPECIAL COVERAGE / PAGE 19
Puerto Rico Investment
Summit Returns
Local Opportunities to be Unveiled
PREMIUM
SPONSOR

2
Thursday, February 8, 2018
Puerto Rico in the times after Maria,
fraught by trial and tribulation, made
mothers of invention of us all as we
muddled toward frugality—not one industry
has been spared. The hardship forced
us all to greatly appreciate so many things that
were once taken for granted. Standing in gas
lines for hours on end, crisscrossing a metropolis
pock-marked by dark intersections has that
effect on the immediate subconscious. Thus, as
life in the greater metropolitan area slowly returned
to “a new normal,” I found great solace
in riding the Tren Urbano to our media company’s
headquarters in Hato Rey. No gas, no traffic—three
bucks, and off we go.
During the first jaunt to Hato Rey’s Roosevelt
station in the heart of Puerto Rico’s financial
district, the stretches of the ride that hovered
above Puerto Rico’s threadbare landscape
took me back in time to rides on Walt Disney
World’s Monorail—only the attractions on our
tattered horizon were not quite as exciting.
Yes, one could see “Tomorrowland” in urbanizations—as
in: “you will have your electricity…
tomorrow”—land.
To be honest, much like Disney where you
have rides sponsored by such stalwarts of
corporate Americana as General Electric and
Monsanto—you could very well see some of
Puerto Rico’s main attractions—El Choliseo,
the Puerto Rico Convention Center, the Puerto
Rico Art Museum, waterfront properties and
a parking lot or two—pawned off to creditors
who are chomping at the bit, now that debt is
back in full play after a brief stalemate in the
months after Maria.
Puerto Rico is trying mightily to rub two nickels
together, but some representatives in U.S
Congress, who seemingly lost their appetite for
charity, are concerned that their taxpayer dollars
might not be spent prudently by the Rosselló
administration. Without fed funds to recover
from the onslaught, Puerto Rico’s economy
is forecast to stagnate at a double-digit clip
in 2018, which opens the possibility for a fire
sale of assets, as happened in Detroit.
Yes, under the brutal diagnosis of Detroit
Emergency Manager Kevyn Orr, in bankruptcy
proceedings heard by Federal Judge Steven
Rhodes, creditors got in line for bitter medicine
in what some have called a Kangaroo Court—
creditor perspectives were colored by tight
haircuts and the assets they might have obtained
instead.
In Detroit, for instance, the city gave monoline
bond insurer FGIC the old U.S. Arena,
which sat on a prime waterfront location. The
Arena has since been imploded to make room
for FGIC’s state-of-art high rise. Monoline
bond insurer Syncora, which also has a horse
in Puerto Rico’s Promesa sweepstakes—together
they are on the hook for some $2.2
Editorial
By Philipe Schoene Roura, Executive Editor
Fairy Tale Negotiations
In
Puerto Rico’s
Magic
Kingdom
billion in Puerto Rico debt—got its cut in the
Detroit Tradeout Jamboree. The financial
guaranty institution came away with the Detroit-Windsor
Tunnel and garages in midtown
next to the sportsplex and development rights
along some pricey waterfront spots in the city.
We have asked this question before: What will
Puerto Rico barter away when National MBIA,
Assured and Ambac come calling.
In Puerto Rico’s debt negotiations—or lack
thereof—there’s discourse that hints things
could be headed for a Motown twist. Phrases
such as “the debt is not payable” and “perhaps
Puerto Rico should have its debt pardoned,”
could be the precursors of a fire sale
of assets. Under that scenario, it isn’t hard to
imagine a thoroughfare’s toll being handed
over to a major creditor. Who could forget
that Ambac is fighting mightily for toll revenue
clawed back in 2016? The bond insurance
company is on the hook for some $493
million in Highways & Transportation Authority
debt.
Phrases such as “the
debt is not payable” and
“perhaps Puerto Rico
should have its debt
pardoned,” could be the
precursors of a fire sale
of assets.
Can’t you just picture it: Instead of “vamos
por la sesenta y seis”—changed to “vamos por la
Ambac?”
If it can happen in Detroit—it can happen in
Puerto Rico; ojo.
Then there’s the crown jewel—Puerto Rico
Electric Power Authority. The bankrupt utility
is about to embark on a transformation that
raises far too many concerns. Front and center,
is the scuttling of a regulatory framework.
Thus, the question begs: “Who will watch
over the transformation of Prepa to make certain
creditors do not gouge a business community
sorely in need of reliable electricity at affordable
rates.

4 THIS WEEK Thursday, February 8, 2018
IN THIS EDITION
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Page 6
U.S. Congress
Expresses Concern
Over Prepa
Privatization Process
Page 7
Is P.R. Tax Reform
Here to Save
the Day?
Page 10
2018
Economic Outlook:
Economists Weigh In
on a Steep Climb
CONTENTS
THIS WEEK
Editorial ................................................................... 2
PUERTO RICO
Top Story ................................................................... 6
Lead Story ............................................................... 7
Insurance ..................................................................8
Cover Story ....................................................... 10-13
General Business .................................................. 14
OPINION
Column .................................................................... 14
ECONOMY
Finance .....................................................................15
GLOBAL
Climate Economics ..................................................17
LIFE
Culture .................................................................... 53
Ad Calendar/Advertising ......................................54
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Miguel A. Ferrer
CEO
Heiko Faass
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Page 19
Puerto Rico
Investment Summit
Returns
Page 37
The Wonder
of Loiza Open
to the World
SPECIAL FEATURE
Puerto Rico Investment Summit ................... 19-40
Rebuilding Puerto Rico ....................................41-52
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6
Thursday, February 8, 2018
PUERTO RICO
Questions remain over details
underpining utility overhaul
TOP STORY
The bill has to
be flexible so
companies will
be interested in
placing bids for
Prepa.
U.S. Congress Raises Concerns
Over Prepa Privatization
—Rep. Victor Parés,
Legislation Must
Ensure Affordable
Rates, Promote
Renewables,
Guarantee
Workers’ Jobs;
Proceeds from
Utility’s Sale to Pay
Pensions
BY EVA LLORÉNS VÉLEZ
e.llorens@cb.pr
Given the fact that legislation
to enable the privatization
of the Puerto Rico
Electric Power Authority
(Prepa) may come after the controversial
overhaul of the Energy Commission
(PREC), which regulates the
energy industry, there may not be the
required scrutiny and analysis of the
offers made by prospective Prepa bidders,
which may result in a bad deal
for Puerto Rico.
That was one of the concerns
raised by congressional members
Nydia Velázquez, Raúl Grijalva and
José Serrano in a letter after the
governor announced Prepa’s privatization.
The Financial Oversight &
Management Board last week objected
to commonwealth plans to
overhaul PREC, giving the government
30 days to come up with another
bill that would ensure PREC
is a separate agency with strong
regulatory powers. The governor
has yet to respond to the request. La
Fortaleza’s bill to overhaul PREC is
under evaluation by the Legislature
and has received opposition.
The congressional members raised
concerns as they questioned Prepa’s
proposed privatization, which will be
enabled through legislation that also
calls for proceeds from the sale to pay
for pensions.
The three U.S. lawmakers asked
if there was an analysis of Prepa’s
conditions to indicate there will
not be a repeat of the failures of
two attempts to privatize the Aqueduct
& Sewer Authority. How will
the government ensure transparency
of the privatization process?
How will the new umbrella entity
that will regulate Prepa be an independent
entity and regulate the
private energy market?
Rep. Victor Parés, who is chairman of
the House Economic Planning, Telecommunications,
Private-Public Partnerships
& Energy Committee, said
he supports keeping PREC as a strong
regulator, expressing reservations about
La Fortaleza’s bill. “I think it can still remain
a strong entity even if it is merged
[with another agency],” he said.
While he does not know when the
governor will submit Prepa’s privatization
bill to the Legislature, he said
his main goals in analyzing the bill
should be to include wording that
ensures affordable rates, promotes
renewables and guarantees workers’
jobs are protected.
Asked how he plans to confirm
there is adequate analysis of the offers
by prospective bidders to ensure
the privatization does not fail, Parés
said he plans for the Energy Commission
to remain a strong regulator.
Critics of the bill have said it would
be a difficult task because, under the
legislation, the commissioners can be
removed at will and PREC becomes
merged with other entities. Parés
thinks otherwise.
Once the privatization bill reaches
the Legislature, Parés said wording
should ensure the process is open and
transparent. The individuals who negotiate
the public to private transaction
should include local companies
and officials and not just U.S. companies,
he said.
What will happen with the contribution
in lieu of taxes and other subsidies
currently granted by Prepa?
Parés said the subsidies that serve a
social purpose must be kept but the
private company should have a say
about what subsidies should be kept.
While he supports placing guarantees
so that consumers are not affected
by privatization, he also said
the bill has to be flexible so companies
will be interested in placing bids
for Prepa, instead of being deterred.
“This whole process must be open to
the public and the people,” he said.
However, a Prepa official said, on
condition of anonymity, that there
are no guarantees possible bidders
won’t lobby lawmakers to lace the
Prepa privatization bill with wording
that is favorable to them. “They
do that all the time,” the source said.
The source insisted on an independent
regulator with several commissioners,
and not just one as the
governor is proposing, will ensure
an adequate analysis of any offers is
completed along with adequate protections
in the privatization bill.
APPA’s President Sue Kelly has
said privatization does not mean
the utility will work well or will
solve Prepa’s problems. The group
says clients in public utilities in the
United States on the average pay
11.5 cents per kilowatt-hour while
clients of privately owned electricpower
companies pay 13 cents per
kilowatt-hour.

Thursday, February 8, 2018 PUERTO RICO 7
P.R. Tax Reform Aims to
Kickstart Economy
Treasury Would
Eliminate Annual
Licensing, Tax
Audits, Cut
Individual,
Corporate Rates
BY EVA LLORÉNS VÉLEZ
e.llorens@cb.pr
Businesses that electronically
file taxes to provide an accurate
picture of their numbers
will receive an internal
score, and if they are in good standing,
will not be required to annually
renew certain licenses, such as to sell
liquor or tobacco, nor will they have
to undergo tax audits.
Those are some of the benefits of the
proposed tax reform the government
touts as an economic development
tool, because it would reduce individual
and corporate taxes, strengthen
investments and, hopefully, curb emigration
at a time when Puerto Rico
has lost 200,000 residents and 10,000
small businesses after hurricane Maria
destroyed the island in September.
“These licenses are a headache for
businesses. If they are in good standing,
they will be able to renew them
every two or three years. And we are
going to have a separate office, so they
can deal with their needs in an expedited
manner,” Treasury Secretary
Raúl Maldonado said. “We will treat
you [electronic filers] differently from
a taxpayer whose numbers I have to
check on paper.”
While Caribbean Business sources
contend the Financial Oversight &
Management Board is unhappy with
the proposed tax legislation because
it does not help reduce a $3 billion
gap in Puerto Rico’s revised fiscal
plan, Maldonado said the bill would
promote sustainable development.
“Promesa requires Congress to give
us an economic development tool, and
Congress has not acted. Therefore,
this is our economic tool,” he said.
Where will the government get
money to close the $3 billion budget
gap in the fiscal plan? Aside from tax
reform, Maldonado is betting on the
combination of renewed economic
development and tax compliance efforts
to hike revenues.
He flatly denied assertions that the
plan is to retool the calculation of
real property taxes by the Municipal
Revenue Collections Center (CRIM
by its Spanish acronym), the entity
in charge of municipal finances, to
close the $3 billion gap in the fiveyear
revised fiscal plan. He said the
plan is to add new properties to the
Property Registry and update taxes
on properties that have undergone
renovations or expansions that were
never reported.
“The modernization of property tax
structures does not mean there will
be a hike in taxes. We want to register
properties that are not currently
registered, and register constructions
that were not reported. Then, we will
do a reassessment,” he said.
Maldonado provided Caribbean
Business an overview of the proposed
tax reform. One of its features will
provide tax incentives to businesses
that hire recent college graduates.
“The goal is to give these graduates
job experience and curb emigration,”
he said. Companies and businesses
can receive tax deductions for reinvesting
in salaries, new machinery
and expansions in an effort to promote
growth.
But the core element of the tax reform
are the cuts in taxes. Individuals
will see a cut in the maximum tax
rate from 33% to 29%, and a cut in the
minimum tax rate from 7% to 1%.
Corporations that currently pay a
maximum 39% tax rate will see that
maximum cut 10% to 29%. The minimum
corporate tax rate, which is paid
by small businesses, will be cut to 17%
from the current 20%. Tax incentives
provided to manufacturing firms
through decrees will be worked on
separately as part of the government’s
intended Incentives Code.
While the corporate tax rate for local
companies is higher than the one
granted under federal tax reform,
Maldonado says the tax code will
make Puerto Rico competitive because,
in the mainland U.S., manufacturing
firms pay federal and state
taxes. In Puerto Rico, companies do
not have to pay federal taxes.
The government, in the meantime,
will continue to lobby Congress, along
with other groups, for amendments
to the federal tax reform that would
change treatment of Puerto Rico to a
domestic jurisdiction instead of foreign,
so local manufacturers can avoid
paying certain taxes, such as the 12.5%
tax on intellectual property.
What will happen to the 4% tax collected
on the earnings of so-called
Law 154 firms? That tax will continue
to be collected since firms that pay it
provide about $3 billion to the government.
He said the U.S. Treasury
Department told the government to
maintain the law so local companies
will continue to get credit on their
federal taxes for paying it.
For the rest of the story go to caribbeanbusiness.com
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8 PUERTO RICO Thursday, February 8, 2018
Unpaid Claims Stifle
P.R. Businesses
Flash Survey
Reveals 92.7
Percent Have Not
Received Their
Disbursements
BY AGUSTÍN CRIOLLO OQUERO
a.criollo@cb.pr
The stories are repeated
time and again, all
throughout Puerto Rico.
Small- and midsizebusiness
operations have been
interrupted by Hurricane Maria’s
devastating track across Puerto Rico.
Any responsible businessowner
would think the blow to his or her
company would be somewhat mitigated
by the disbursement of their
insurance in a reasonable period. It
is an insurance policy that the businessowner
has probably paid for
years, expecting the company to respond
with the same efficiency as the
customers who fulfilled their payment
responsibilities.
However, after the wake of destruction
left behind by this atmospheric
phenomenon, and more than four
months since it tore across Puerto
Rico, the island’s leading insurance
companies have thousands of businesses
in a kind of limbo by not disbursing
the corresponding insurance
payments—and holding the local
economy hostage—many businesspeople
state. This situation has prompted
many businesses to cease operations,
leavings hundreds of families without
an income and further affecting the already
battered economy.
Two weeks ago, the Insurance
Commissioner’s Office (OCS by its
Spanish initials) indicated that 542
fines had been issued to a single
insurer, out of the 14 companies
of this type that deal with damage
claims tracing not only to Maria, but
also to Hurricane Irma, while stating
that in subsequent weeks, more
fines would be issued.
Despite the issuing of fines, businesspeople’s
testimony attest to the
precarious situation that has provoked
delay in disbursement of payment
on insurances policies. Furthermore,
they said this situation
could send Puerto Rico into an unprecedented
economic abysm.
A flash survey conducted by the
United Retailers Association (CUD
by its Spanish acronym) of 185 of
its members revealed that 92.7 percent
of them have not received their
claims, while 50.8 percent of them
submitted their claim during October
2017 and 24.3 percent in September
2017. In the past weeks, this
came after the Insurance Companies
Association (Acodese) assured that
for the month of January, it would
have disbursed some $1 billion in
policy payments.
According to the survey, the explanations
from insurers to their clients
ranged from proposed offers being
well under the claim amount, that
they are still in the review process
or there is a high volume of claims to
just simply refuse to offer a concrete
reason for the delay.
Notwithstanding, in what is a
curious fact, 99.4 percent of those
surveyed said they had not filed
a formal complaint with the OCS,
even though the Insurance Commissioner
has been emphatic in
stating that without a formal complaint,
it is impossible for that office
to complete an investigation.
Meanwhile, 58.3 percent of those
surveyed said the delay in insurance
disbursements is affecting operations
greatly, while 32.74 percent say it is
affecting them to a lesser extent and

Thursday, February 8, 2018 PUERTO RICO 9
only 8.93 percent state it creates a
minor impact.
Furthermore, the businesspeople
surveyed highlighted complaints
about the service and efficiency of
these insurance companies, as well
as an increase in costs to renew policies,
even for clients that have yet to
receive their disbursements.
For economist & professor at University
of Puerto Rico-Mayagüez,
José Alameda, the delay in payment
of the insurance policies of small
and midsize businesses is another
strong impact on an economy that
has been in an acute recession since
2006. According to Alameda, if this
stagnation in the disbursement of
money, in terms of insurance policies,
continues, it could send the island
into an economic catastrophe.
“This is going to delay the recuperation
of different businesses on the
one hand. On the other hand, businesspeople
are going to apply for
loans, whether with FEMA [Federal
Emergency Management Agency]
or private banking. But it is not going
to be easy for them to be given
a loan in the conditions they find
themselves, save that they already
have credit lines, but not every business
has them,” Alameda said.
“There are 5,000 businesses that
were interrupted, according to the
information I have seen, including
from CUD, and in the measure that
this is delayed, it could have negative
effects that could become a vicious
cycle. Not being able to continue
with their business, many of these
people, owners and employees, are
going to continue migrating to the
United States and that, in turn, is going
to continue affecting the government’s
revenue and delay even more
the recuperation process.”
Oversight continues
In recent weeks, the OCS announced
it issued 2,857 violation orders
on six insurance companies, for
a total of an additional $2 million in
fines to these companies.
As indicated by the government
agency, the imputations also correspond
to a breach of Article 27.162
of the Puerto Rico Insurance Code,
which implies there was a delay in
the resolution and payment during
the term established by law.
Prior to this announcement, the
insurance commissioner, Javier
Rivera Ríos, explained to Caribbean
Business that there were 350 fines
in the first round, for a total of
$380,000. The official added that
after issuing the fines, the matter
will continue to be addressed.
“Once the fine is issued, it does not
exempt them from payment, and
the order we established states they
have to provide immediate resolution
of the case. This being said,
they can challenge the fine, but it
does not exempt them from immediately
resolving the case. They
have to respond to the claim within
10 day after the fine is issued,” Rivera
Ríos said.
However, various entrepreneurs
have questioned the criteria used
to set the amount for the fines because
it represents a small reprimand
to multimillion-dollar companies
and such a low amount does
not create the necessary pressure
to make these companies act in favor
of the insured.
“What we want is for them to pay,
or at least to answer. There are
many reasons one takes into consideration
when it comes to contemplating
the amount for a fine.
Here, the mood is not one that destabilizes
the insurance industry by
irresponsibly issuing fines. This is a
process where there are some penalties.
Fines are not issued to create
a destabilization of the industry
that are abusive, nor is it about an
abuse of power,” said the insurance
commissioner while categorically
rejecting the idea that these companies
have a mitigation fund for fines,
We will not
tolerate any
insurance
company that has
unanswered claims
without just cause.
—P.R. Insurance Commissioner
Javier Rivera Ríos
which is why they do not yield the
expected results.
“The amount of the fine is up to
the OSC, and such a fund does not
exist in those companies. If each
insurance company makes an additional
operational fund, well, good
for them, but it is not that they
have a fund to pay for fines. What
there needs to be is a consequence
for not issuing the payment, and we
are in the stage of initially submitting
the complaints. The code sets
some parameters for the amount
of the fine, and it is the insurance
commissioner who determines the
amount,” he added.
Rivera Ríos also dismissed that the
delay from the insurance companies
is due to problems these firms may
have with their reinsurers.
“That is dismissed. It’s not for a
lack of money [the delay]; it is more
due to operational management and
internal administrative management.
But it is important they know
that we continue oversight. We will
not tolerate any insurance company
that has unanswered claims without
just cause. We gave them a reasonable
margin, everybody here was
equally affected by the hurricane,
but that is why we gave up to 120
days when the ordinary code states
90 days,” he said.

10 COVER STORY
THURSDAY, FEBRUARY 8, 2018
Puerto Rico 2018
Economic Outlook
Economists Weigh in on Puerto Rico’s Long Climb
BY EVA LLORÉNS VÉLEZ
e.llorens@cb.pr
In September 2017, Hurricane
Maria made landfall
on Puerto Rico with the
storm’s eye passing directly
over the island. The effect was
devastating, leaving a total of $90
billion in damages and taking its
toll not only on the human, social
and psychological fabric of Puerto
Rico but also on its fragile economy,
labor market dynamics and
individual businesses.
Grim outlook
What’s more, Puerto Rico’s economic
outlook faces a bleak prognosis.
The latest indicators suggest
the decline in real gross national
product (GNP) for 2017-18
could be close to double digits and
then should improve in subsequent
years as federal funds come
in, some $21 billion in insurance
claims are paid and restoration
moves into full force. The government’s
most recent revised fiscal
plan painted a bleak picture of
Puerto Rico struggling to jumpstart
an ailing economy that was wounded
further still after suffering one
of its worst natural disasters in a
century. Puerto Rico has requested
$94.4 billion in Federal Disaster
Relief Assistance, but its projections
assume the island will get
$35.3 billion.
While the previous 10-year fiscal
plan, issued in March of last
year, set aside some $3.9 billion to
pay the island’s creditors across
five years, or an average of about
$787 million annually, the new
plan, revised after the hurricane,
contains no funds to pay creditors.
Now, Gov. Ricardo Rosselló is saying
the government will wait for
the bankruptcy proceedings enabled
by the Puerto Rico Oversight,
Management & Economic Stability
Act (Promesa) to be completed to
determine debt repayment. A $3.7
billion surplus in the previous plan

THURSDAY, FEBRUARY 8, 2018
COVER STORY 11
for the first five years, will now be
a $3.4 billion gap, even after the
elimination of funding to municipalities,
rightsizing the government
and enforcing tax laws.
Real GNP, inflation,
population, revenues
The real GNP is expected to
shrink by 11.2 percent this year
next five years. Lyman Stone, an
adviser for consulting firm Demographic
Intelligence, who was invited
Nov. 16 to a listening session
of the Financial Oversight & Management
Board (FOMB), said at the
time, the island’s population would
shrink by 587,943 in the five years
after Maria.
Government revenues are also
consumption and fixed investment
decrease. For FY18, FocusEconomics
Consensus Forecast panelists
estimate the GNP will contract 1.8
percent but predicted GNP growth
for FY19 will be only 0.3 percent.
The Economic Intelligence Unit
of the Economist, meanwhile,
projects the economy will shrink
by 8 percent, in the wake of the
difference in the projections traces
to the assumptions. The government
has predicted a drop of 11.2
percent in the GNP because preliminary
numbers show that up to
200,000 taxpayers have left Puerto
Rico since the hurricane.
“It is not the number of people;
it is the type of taxpayer. I know
10,000 businesses have closed;
services always grows after a disaster,
and everything having to do
with finances, accounting and legal
advice achieves a key role,” he said,
insisting on the government’s policy
of promoting job creation.
One of the sectors predicted to
grow, after 15 years in a recession,
is construction. Stephen Spears,
head of the Associated General
The island’s economy
grew after hurricanes Hugo
and Georges…and there is
more investment now than
at that time.
I know 10,000 businesses
have closed; for every
100 businesses that are
closed, 40 will not be able
to reopen.
I predict the economy will
grow by 4 percent because of
the flow of federal funds and
insurance claims. For every
million dollars coming into the
island, some 22 new jobs are
created.
— José Joaquín Villamil ,
Economist
— Raúl Maldonado,
Treasury Secretary
— Antonio Rosado,
Economist
and then grow by 7.6 percent in fiscal
2019, dropping to 2.4 percent
growth in FY20 and grow in subsequent
years fueled by the $35 billion
in federal disaster support. The
nominal GNP, which is calculated
at current price levels, is estimated
to fall sharply in FY18, by minus-9.3%
because of the hurricanes,
only to grow in FY19 by 9.3 percent
and 2.4 percent in FY20.
In addition to disaster relief assistance,
Puerto Rico requires external
liquidity support to finance
the gap until fiscal measures are
fully implemented, according to
fiscal plan numbers.
The plan states the hurricanes
will create a spike in inflation of 2
percent in FY19, with subsequent
average increases of about 1 percent
over the next five years, until FY22.
A 19.4 percent cumulative decline
in population is expected over the
slated to decline 18 percent in FY18
before increasing 9 percent in FY19
and 4 percent in FY20. Taxes collected
from individuals and corporations
are expected to decline
by 19.1 percent and 11.7 percent,
respectively, for FY17 and FY18, as
a result of hurricanes Maria and
Irma, then will grow annually at
a nominal GNP growth rate of 4.5
percent through FY22.
Housing down,
labor may surge
However, not all economic studies
paint the same negative outlook.
Trading Economics predicts
the gross domestic product will
shrink by an average of 1.5 percent
over the next year. FocusEconomics,
which provides forecasts from
leading world economists, said the
economy is expected to remain in
recession this fiscal year as private
devastating hurricane that left the
island without electricity.
Economist Antonio Rosado, who
is an economic adviser to retailers,
predicts the economy will grow by
4 percent because of the flow of
federal funds and insurance claims,
as well as growth in the construction
sector. For every million dollars
coming into the island, some 22
new jobs are created.
“The island’s economy grew after
hurricanes Hugo and Georges…
and there is more investment now
than at that time,” he said. Economist
José Joaquín Villamil has also
predicted very minor growth in the
real GNP projected at 2.6 percent in
FY18 and 3.6 in FY19 with the disclaimer
that those numbers are under
revision because there is still a
lot of uncertainty.
Why the difference? Treasury
Secretary Raúl Maldonado said the
small businesses that were a microcosm
because they provided jobs to
the owner, his wife and children.
That is a strong blow. The numbers
also show that for every 100 businesses
that are closed, 40 will not
be able to reopen,” he said.
While the island expects an injection
of federal funds for reconstruction,
the money will come
in slowly and the projects are not
slated to start immediately. “We
already finished the first response
stage, but the planned reconstruction
will take time, which is why
we see shrinking in the economy
followed by growth,” he said.
What should the people do? Maldonado
advised Puerto Ricans to
weather the effects of the storm
and consider staying on the island.
“There will be lots of opportunities
for growth, once we get the capital
injection. The area of professional
Contractors Puerto Rico chapter,
said most of the 214 members of
the organization have created an
estimated 20,000 jobs. Government
construction investment is expected
to grow by 141.3 percent in FY18
and 94 percent in FY19. Private
construction investment is expected
to grow 107 percent in 2018 and
71 percent 2019, according to an Estudios
Ténicos Inc. study.
A prior 2016 study by Estudios
Técnicos for the Economic Development
& Commerce Department
had noted construction investment
in Puerto Rico declined significantly
as a share of GNP, from 14.8
percent in FY2000 to 4.6 percent
in FY15, because of a decline in private
construction. The largest decrease
occurred in the private sector;
from FY2000 to FY15, private
Continues on page 12

12 COVER STORY THURSDAY, FEBRUARY 8, 2018
PATH TO STRUCTURAL BALANCE I ECONOMIC OUTLOOK
Negative impact of hurricanes on
economic outlook is mitigated by
federal support and positive impact
of structural reforms
NOMINAL
GNP GROWTH
(PERCENT)
FY18 FY19 FY20 FY21 FY22
9.3
4.0 3.2 3.0
-9.3
• Nominal GNP is estimated to fall sharply in FY18 due to the impact
caused by Hurricanes Irma and Maria. Disaster recovery assistance and
rebuilding efforts drive higher nominal growth in subsequent years.
• The key driver to the financial projection is revenue growth, which is
estimated for FY18 using the elasticity of revenue to nominal GNP observed
during the U.S. Great Recession and is consistent with general
fund collections through November.
• Revenues are not anticipated to recover to pre-Hurricanes levels
through the projection period: revenues are forecasted to remain 1.3%
lower than pre-storm levels by FY22, in nominal terms.
REVENUE
GROWTH
(PERCENT)
INFLATION
(PERCENT)
POPULATION
(PERCENT)
-18.3
2.1
-7.7
9.3
4.0 3.2 3.0
1.6 1.5 1.4 1.4
-2.0
-3.6 -3.2 -2.9
Continued from page 11
construction investment lost about
$3 billion, or 55.6 percent of its
FY2000 volume.
However, real estate is expected
to decline. According to the Construction
& Sales Activity Report,
prepared by Estudios Técnicos,
sales of new housing units barely
reached 2,339 in FY15, compared to
9,762 in FY08 and 13,400 in FY05.
Not only did the number of new
housing-unit sales decline to historic
lows, the trend of mortgage
originations suggests further deterioration
in upcoming years. The
total volume of mortgage-loan originations
declined from about $6.59
billion in 2008 to about $3.17 billion
in 2015. Additionally, mortgage delinquency
rates increased from
6.8 percent in 2008 to 12.4 percent
in 2015. In June 2017, there
were 15,000 homes in the foreclosure
process, or a 12.29 percent
delinquency rate, which was a
reduction compared to 12.89 percent
in December 2016.
The weakness of the housing sector
is also reflected in the fact that
the number of foreclosed residential
units increased from 2,357 in
2008 to 4,459 in 2015, for an 89.2%
increase. Around 5,000 homes were
foreclosed by June 2017.
The reduction in population and
average family size has resulted in a
steep increase in the percentage of
vacant housing units.
The labor sector has also
weakened, but officials hope new
jobs will be created from reconstruction
work and the proposed
local tax reform. Nonfarm salaried
employment has declined to
lows unseen since before 2000.
For FY15, there was an average
of 887,700 employees, with
about 671,000 people employed
in the private sector. Compared to
FY2000, private employment in
FY15 decreased by 68,300 and public-sector
employment by 48,300
employees. In July 2017, there were
879,000 nonfarm salaried workers,
but by December 2017, that number
had dropped to 847,000. The total
number of persons employed was
980,000 in December 2017. The unemployment
rate was 10.9 percent.
In July 2017, there were 989,000
people employed. The unemployment
rate was 9.8 percent. In January
2017, there were 981,000 people
employed and the unemployment
rate was 12.2 percent.
In FY17, the government approved
a labor reform law that
sought to create more jobs by easing
labor laws that protect workers.
Labor Secretary Carlos Saavedra
said the storms erased any progress
made by the law. However, he said
there were 200 more jobs in August
2017, before the hurricane, than
there were in January 2017.
“It was the first time in four
years that the private sector has
created jobs,” he said in a report
to the Legislature. Saavedra hopes
the economic outlook for labor
will improve. While Maldonado
noted the government hopes to
create more jobs through the proposed
tax reform, he said recuperation
efforts are already creating
jobs despite the shutdown of
numerous businesses.
Tourism up,
Manufacturing at risk
The manufacturing sector, which
is the core of the island’s economy,
however, is expected to suffer. The
Fiscal Plan says Act 154 revenues in
the baseline are assumed to decline
by 15.3 percent, from $1.76 billion
in FY18, with continued erosion
through FY22 to $1.03 billion.
The impact of the Tax Cut & Jobs
Act, compounded by Hurricane
Maria’s negative impact on the infrastructure
supply chain, accelerates
the previous declining revenues
trend of controlled foreign
corporations. The cumulative discount
in FY22, relative to FY17, is
about 50%. “Moreover, during the
FOMB
1990s, manufacturing represented
almost 19% of total employment,
yet today this number plummeted
to 8%. The reduction in the relative
importance of this sector, vis-à-vis
other sectors in the economy, has
caused a structural shift in the labor
market, international trade and
capital flows,” the plan says.
Manufacturers Association
President Rodrigo Masses said
manufacturing is still the leading
industry in Puerto Rico and
praised the government for working
on a tax reform proposal that
will reduce corporate taxes and
make the island competitive.
The outlook, however, is not as
grim as the tourism sector is expected
to grow.
The Puerto Rico Tourism Co.
(PRTC) said tourism is recovering
rapidly and sees a positive
outlook for 2018. In a statement,
the PRTC says there is more than
$1.9 billion in hospitality development
in the pipeline and a lodging
inventory undergoing renovations.
More than 122 hotels are
now operating, which equates
12,458 available rooms. Some
2,670 more rooms will be added
to that inventory after undergoing
renovations. For example,
the Wyndham Grand Río Mar
Puerto Rico Golf & Beach Resort,
the Ritz-Carlton Reserve and El
San Juan Hotel were undergoing
renovations.
Looking ahead, the Puerto Rico
Tourism Co. estimates there are
25% more rooms in the pipeline
under development, which equates
to 3,800 new rooms. Some hotels
in the pipeline are the JW Marriott,
Aloft San Juan Convention
Center, Aloft Ponce, Serafina Hotel
and Four Seasons Cayo Largo.
About $1.9 billion will be injected
into new developments and renovations,
which contributes to adding
roughly 3,831 new jobs.
By the end of June 2018, Puerto
Rico will have received 1.04 million
passengers from cruiselines. The
2018-2019 cruise season is set to
witness a record-breaking 1.7 million
passengers, which is expected
to generate roughly $250 million in
revenue for the economy.
Two weeks after Hurricane Maria,
the Luis Muñoz Marin International
Airport had 20 daily flights,
but today, there is an average of 110
daily flights. Capacity is also on the
rise with current monthly seat volume
of 391,000. By July 2018, seat
capacity is expected to increase by
81,000 more.

Thursday, February 8, 2018 PUERTO RICO 13
Investment Summit to Showcase Opportunities
Renewable
Energy, Blockchain
Technologies to
be Highlighted at
Event
BY YANIRA HERNANDEZ CABIYA
y.hernandez@cb.pr
The fifth edition of the
Puerto Rico Investment
Summit that kicks off
Feb. 12 in San Juan will
focus on new business possibilities
on the island after the devastating
Hurricane María passed across
Puerto Rico last year. The event
was slated for October 2017, but
the conditions in Puerto Rico just
weeks after storm led to its postponement
until 2018.
“In the end, it has been very interesting
because we have been able to
work on new approaches that were
not contemplated in the beginning of
2017,” said Brenda González, president
of the Investment Summit.
This time, the themes of renewable
energy and blockchain technologies
will be highlights of the event.
The Puerto Rico Investment Summit
was created in 2013 to promote the
various incentives that Puerto Rico
has to offer to attract investment to
the island. In principle, it was understood
that it was aimed at foreign investors
who would benefit from Acts
20 and 22; however, each day there
are more local entrepreneurs who attend
the event to learn about available
incentives, while they also use the opportunity
to network with potential
business partners.
“Some people think this is just for
the foreign investor but it’s not. The
themes are relevant to both the investors
who come from abroad to do
business on the island and the local
investor who has a new enterprise
and does not know how to benefit
from existing incentives. The event
has an educational element but we
also try to give some space for networking.
That way, attendants can
share in a less formal atmosphere
and establish connections that will
serve them in their businesses,”
González said.
Throughout the summit’s two
working days, attendants will hear
the experiences of successful investors
who have set up their businesses
in Puerto Rico, and get to know their
successes and challenges, as well as
their expectations for coming years.
The new panorama
Interesting business opportunities
are expected in Puerto Rico as a result
of the federal money that will
arrive to the island for post-hurricane
recovery and proposed structural
changes to expedite Puerto
Rico’s economic development.
In fact, the first guest speaker during
the summit will be Economic Development
& Commerce Department
Secretary Manuel Laboy, who will
trace the main outlines of the new
Law of Incentives that the administration
of Gov. Ricardo Rosselló will
present this year.
The secretary has anticipated that
given the new political and economic
reality that the island faces, the focus
should be directed to the generation
of local capital, joined with the island’s
economy through the export
of goods and services that do not depend
on federal incentives.
The impact of the recently approved
federal tax reform on the local economy
and businesses will also be a focus
of analysis at the summit.
Energy and blockchain
The transformation of the island’s
energy system, which is beginning
to take shape after Rosselló
Nevárez announced a new policy to
privatize the Puerto Rico Electric
Power Authority (Prepa), will be
discussed during a panel moderated
by Caribbean Business Executive
Editor Philipe Schoene Roura.
Participants on the panel include
Julia Hamm, president & CEO of
Smart Electric Power Alliance, a
Some people think this is
just for the foreign investor,
but it’s not. The themes
are relevant to both the
investors who come from
abroad and the island.
—Brenda González, president
of the Investment Summit.
not-for-profit entity that facilitates
effective transition toward cleaner
power generation, such as with the
use of solar energy.
The highlight of the event will be
the presentation by Brock Pierce,
co-founder of Block.one, Blockchain
Capital and chairman of the Bitcoin
Foundation; and Steve Bassi,
founder & CEO of Narf & Swarm
and Swarm Technologies Inc., to
discuss cybersecurity in these times
of blockchain technologies.
At the end of the event, there will
be a question and answer session,
so attendants can clarify any doubts
on how, where and why to invest in
Puerto Rico.

14
Thursday, February 8, 2018
OPINION
The advantages of having a resilient, nonfossil fueldependent
and autonomous system are now evident
Throughout Puerto Rico, the idea of
organizing microgrids that can be
disconnected from the main utility
provider and operate autonomously
is gaining momentum. The traditional
model—whether a state- or privately-owned
utility (considering the Electric Power Authority’s
[Prepa] upcoming privatization process)—producing
or buying energy from distant
generators and distributing the service
across the country is being challenged. With
newly infused energy from the most unlikely
of sources—Hurricanes Irma and Maria—the
Puerto Rico Energy Commission (PREC)
finally decided to move ahead with a longneeded
comprehensive regulatory model on
microgrids, with its Jan. 3, 2018, publication
of a proposed regulation. This “novel” approach
for energy production and distribution
is essentially a restatement of the old
ways, many decades ago, when we “self-provided”
our energy.
Technically, microgrids are a self-reliant network
for delivering electricity. Normally, these
systems operate in conjunction with the main
grids, but should be able to operate detached
from them for extended periods; often indefinitely,
depending on the energy source.
The Energy Commission’s proposed regulation
constitutes an honest and thorough intent
for “delivering energy services to customers
in need, while integrating new technology
and industry trends into Puerto Rico’s energy
market.” The Commission recognizes that the
damages caused by the hurricanes, and the
complexity associated with restoring service,
do not allow for “continued delay in implementing
a regulatory framework that encourages
the deployment of distributed generation,
energy storage and microgrid technologies.”
This framework recognizes the diversity of
possible systems, based on their ownership
structure, size and whether it sells energy to
third parties. In terms of the possible ownership,
the proposed regulation recognizes almost
every conceivable legal entity, including
individuals, partnerships and customer cooperatives;
single or municipal consortiums, administrative
divisions of the Commonwealth,
and non- or for-profit entities.
In terms of resources, these microgrids
might produce energy from essentially all
known and available sources; that is: solar,
wind, geothermal, renewable biomass combustion,
renewable biomass gas combustion,
combustion of biofuel derived solely from renewable
biomass, qualified hydropower, marine,
hydrokinetic and ocean thermal energy.
The advantages of having a resilient, nonfossil
fuel-dependent and autonomous system
are now evident. For one part, having
smaller, isolated grids would have allowed
for an expeditious recovery of the destroyed
Column
By QAC Telecom, Energy & Infrastructure Working Group
Edwin Quiñones, Víctor Candelario, Giselle Martínez,
Luis Daniel Rosa, Edwin J. Quiñones-Porrata
Freedom from the Grid:
Energy
Sovereignty
for All
lines and energy production systems. Secondly,
the reliance on renewable energies
would have liberated Puerto Rico from its
enormous dependence on costly and distant,
extracted and refined fossil fuels. Likewise,
while the high cost of energy limits Puerto
Rico’s ability to stimulate its economy, the
situation makes more logical any novel endeavor
to attract private energy investors
from abroad.
For years, Prepa’s clients have been scrambling
to find every opportunity that allows
any of these individuals and corporations
the ability to be rid of the public corporation
as their retail energy provider. To top
it off, large and small corporations insistently
have clamored for the entry of wheeling
and virtual net metering into Puerto Rico’s
energy legal framework. Microgrids are
certainly one of the main solutions to the
economy’s demand.
For microgrids and other
new and innovative
technologies and
programs to flourish,
we have to assure
the regulator comes
through, [and] the
government supports
these initiatives.
As of today, this administration has positioned
all its expectations on electric utility privatization.
Many thoughtful individuals will celebrate
this decision, yet we have to remember
that for microgrids and other new and innovative
technologies and programs to flourish, we
have to assure the regulator comes through,
[and] the government supports these initiatives
and, finally, the future private operator commits
to these policies. Everyone is invited to be
onboard. The Chinese have an expression that
says: “May we live in interesting times.” Boy,
are we living in interesting times. We shall not
let it go to waste.

Thursday, February 8, 2018 15
ECONOMY
Let the transformation begin
Think Strategically:
Groundhog Day
BY FRANCISCO RODRIGUEZ-CASTRO
frc@birlingcapital.com
President Trump’s State of
the Union: Groundhog Day
When German settlers arrived
in Pennsylvania in the 1700s, they
brought with them Candlemas Day,
the day in which the groundhog
peeps out of its burrow and, if it sees
its shadow, goes back into its burrow
for another six weeks. This past Friday,
the most famous groundhog of
all, Punxsutawney Phil, saw his shadow,
predicting six more weeks of winter.
We are not sure if, in this case, this
was a response to President Donald
Trump on Tuesday night, a very long
speech in which he revisited his accomplishments
of his first year.
If we learned to read President
Trump, it is that we need to pay more
attention to what he does rather than
to what he says; in that light, here are
some of the takeaways.
America First: Trump’s motto and
campaign slogan are now the nation’s
policy and the President talked
at length about Tax Reform, the
stock market, job creation, deregulation
and immigration.
Bipartisanship: Has been absent all
year and may not happen.
90% of the speech was pure celebratory:
A victory lap.
Obama’s legacy in peril: President
Trump has mainly been slowly chipping
away, at every opportunity, at
most of President Obama’s policies
and priorities.
The Russia Investigation: Largely
ignored in Trump’s speech was mention
of the special counsel.
The imagineering was superb: All
the President’s invitees were superbly
chosen and the tone was set right for
each one.
The President delivered a solid
speech with the right tone and message;
however, watching that groundhog
go back into his burrow may be a
sight to notice.
Job growth beat expectations
by 11.11 percent for January 2018
Total nonfarm payroll employment
grew by 200,000 in January, and the
unemployment rate was 4.1 percent,
IPO Calendar—Trade Date Estimate: Week of Feb. 5, 2018
and most wages saw their most significant
jump since the end of the
Great Recession, the Bureau of Labor
Statistics said in a closely watched
report Friday.
Economists surveyed had been expecting
jobs growth of 180,000, yet
the economy was able to produce
20,000 more, or 11.11 percent.
Puerto Rico Update:
The 2nd Promesa Conference
full of great insight
On Jan. 31, the Chamber of Commerce
and Birling Capital Advisors
LLC presented the 2nd Promesa
Conference before a sellout crowd of
CEOs, 20/22 Investors, businessowners,
entrepreneurs, agency heads,
Company Ticker Deal Size
IPSCO Tubulars IPSC $500 million
Cactus WHD $375 million
TFI TAB Food Investments TFIG $220 million
Victory Capital Holdings VCTR $211 million
Bioceres BIOX $130 million
Quintana Energy Services QES $125 million
Huami HMI $110 million
Cardlyitics CDLX $76 million
Evolus EOLS $65 million
Motus GI Holdings MOTS $30 million
legislators and mayors.
The opening keynote by Jim
O’Drobinak, CEO of Medical Card System
Inc. (MCS), was riveting, insightful
and passionate about Puerto Rico,
its future and the future of healthcare.
During the discussion, O’Drobinak
presented five concepts that have
eluded us, as follows:
2 G’s: Greater Good (Don’t think
only of yourself ).
2 C’s: Common sense, Courage.
Deregulate: Help comes faster when
it’s easier to assist.
Infrastructure: Every healthy society
needs a foundation.
Define the Endgame: You never hit a
goal you don’t have.
As Puerto Rico continues on its path
of reconstruction, the 2G’s, 2C’s, Deregulate,
Infrastructure and Define
the Endgame concepts are a necessity
for Puerto Rico. We cannot continue
the idea that business as usual will do
when, for the past decade, it has not.
Moving forward on efforts to revitalize
and transform the electric
and water services, a discussion with
Cristian Sobrino, the Governor’s representative
to the Oversight Board
(FOMB), Noel Zamot, Revitalization
coordinator for the FOMB, Elí Díaz,
president of the Puerto Rico Aqueduct
& Sewer Authority (Prasa) and
Danny Oppenheimer of Fluor.
The session emphasized the Governor’s
intention to see through Prepa’s
sale, committing the fiscal and
advisory team to accomplishing the
sale process as fast as possible to enter
into what will be the new model
for the Puerto Rico Electric Power
Authority (Prepa). We asked Prasa’s
Díaz if his corporation was for sale,
and he said it was not; however, they
were looking toward new ways to
innovate and enhance their existing
operations. According to Zamot,
the FOMB supports the Governor’s
public-policy determination and reiterates
and affirms its commitment
to support the administration in this
initiative, which is just beginning.
During the conference, Gov. Ricardo
Rosselló announced the creation
of the working group in charge
of Prepa’s transformation and indicated
that together with this working
group and the FOMB, there is a Title
III bankruptcy component that is important
in this process. The team includes
the governor’s representative
on the FOMB, Sobrino; the principal
infrastructure adviser to the governor,
María Palou; Prepa’s principal
economic adviser, Todd W. Filsinger
and the Rothschild financial advisory
group. The governor indicated the
components in the transformation
model would allow a reduction in the
kilowatt-hour rate and, if achieved,
would have a direct impact on the future
macroeconomic projection.
FOMB Chair José B. Carrión stated
during a keynote that “we commend
the Governor’s courage to promote
this solution at this time when Puerto
Rico needs it most.” The FOMB’s goal
in this process is twofold: Reduce the
cost of electricity through diversification
of fuels for generation and increase
operational efficiency to lower
costs and improve the reliability of
the electrical system.
In conclusion, Puerto Rico is in a
very complicated situation, which is
mainly of our own doing on the fiscal
front, and now we are facing the
circumstances created by the natural
disasters. Both are equally destructive
and must be addressed with diligence.
George Bernard Shaw said it
best: “Progress is impossible without
change, and those who cannot
change their minds cannot change
anything.”
In Puerto Rico, we do not have the
equivalent to a groundhog, but if we
did, it would be hunkered down in
its burrow.
Francisco Rodríguez-Castro,
president & CEO of Birling Capital,
has over 25 years of experience
working with government, multinational
and public companies.

“Success comes from an unwavering commitment to excellence.”
Puerto Rico Law Firm of the Year
O’Neill & Borges LLC has been recognized as the 2017 Law Firm of the Year of
Puerto Rico by the prestigious London-based Chambers & Partners, the most respected
independent legal directory worldwide. The award was presented in a ceremony held in
Miami, Florida on November 17, 2017, along with other leading law firms from Latin
America. This is the third time the law firm is recognized with this top award after being
recognized in 2011, the first time Chamber’s & Partners surveyed and ranked law firms in
Puerto Rico, and then again in 2014. The firm was also recognized as top-ranked law firm
in the corporate/commercial, dispute resolution, environmental, labor and employment, real
estate and tax practice areas.
O’Neill & Borges LLC is honored with this distinction and shares this award once again
with its team of attorneys, employees and clients.
www.oneillborges.com - 787(764)8181

Thursday, February 8, 2018 17
GLOBAL
Extreme climate events such as hurricane
Maria have drawn global attention
Study:
Cyclones
Unleash
Long-Term
Economic
Stagnation
World Economic Forum
in Davos, Switzerland
Rejects notion
that natural
disasters
stimulate
economic growth
BY AGUSTÍN CRIOLLO OQUERO
a.criollo@cb.pr
While many sectors
in the United States
still deny the reality
of climate change
further hastened by the human footprint
on the planet, the truth is that
there are some groups, economists
from around the world, for example,
already pondering the economic implications,
in the long run, relative
to the effects of such atmospheric
phenomena as Puerto Rico’s recent
punch from Hurricane Maria.
According to the study, “The Causal
Effect of Environmental Catastrophe
on Long-Run Economic Growth,” by
economists Solomon M. Hsiang, professor
at the School of Public Policy
at University of California at Berkley,
and Amir S. Jina, professor at the
School of Public Policy at Chicago
University, who reviewed evidence
from 6,700 cyclones that occurred
over a period of six decades, and
their effect on different economies. A
catastrophe, such as the one Puerto
Rico experienced, has permanent effects
on any country.
Likewise, the information gleaned
from the study categorically rejects
the hypothesis that natural disasters
stimulate economic growth or
that in the short term, losses disappear
following emigration and
wealth transfers.
In an article published by the
New York Times (NYT), just nine
days after the hurricane, and titled
“Don’t Let Puerto Rico Fall Into an
Economic Abyss,” Hsiang argues
that unfortunately the greater cost
of the disaster is yet to be seen because
the study unequivocally reveals
that hurricanes have a strong
impact on the economic growth of
a country, even decades after the
event.
According to Hsiang, historically,
one out of 10 cyclone events slows
the per capita income of the affected
country until it is some 7% poorer
than two decades before the storm.
This, he states, equals the losses due
to an average financial or banking
crisis, and he expressed the impact
from Hurricane Maria could be
worse than has been estimated.
“To determine how much it worsens,
we used an econometric model
of the costs of cyclones in the past
60 years and applied it to the characteristics
of Hurricane Maria and
the economic conditions prior to the
storm in Puerto Rico. We calculated
that Maria could reduce incomes
in Puerto Rico by 21% during the
next 15 years, totaling $180 billion in
losses in economic production,” said
Hsiang in the NYT article.
“Supposing that Puerto Rico would
have been on its way to maintain its
per capita annual growth of 0.8%
between 2009 and 2015, then we
would expect Maria to undo all
those gains and more. Now, it could
take 26 years for the next generation
to return to where we are today,
assuming the per capita growth rate
would have continued [as it had],”
he added.
According to the study by Hsiang
and his colleague Jina, the goods of
the United States are much more
given to being destroyed by a cyclone
of such magnitude, than the goods of
other countries or jurisdictions that
are well-off, such as Japan, Hong
Kong and Australia. This is due in
part to the fragility of the infrastructure,
which more closely resembles
We calculated
that Maria could
reduce incomes in
Puerto Rico by 21%
during the next
15 years, totaling
$180 billion in
losses in economic
production.
— Solomon M. Hsiang, professor
at the School of Public Policy at
University of California at Berkley
that of a less prosperous country.
“That definitely was the case with
the electricity system in Puerto
Rico, administered by a public corporation
that filed for bankruptcy
last summer. The island’s entire
electrical infrastructure was destroyed
by the storm. We are not
ready and that will cost us a high
price,” the economist predicted.
Hsiang’s ominous prediction becomes
more visible after the World
Economic Forum (WEF), held in Davos,
Switzerland, at the beginning of
the year, and that had as a title “Creating
a Shared Future in a Fractured
World,” listed extreme climate events
as one of the latent global risks, along
with arms of massive destruction, according
to the community of experts
associated with WEF.
The opinion of these experts was
collected through an internal survey
among business specialists, government
representatives, nonprofit organizations
and other international
institutions. The questionnaire asked
the respondents to list, from one
to five, the bigger risks they visualized
could build the biggest impact.
However, although every region of
the planet had representation in the
questionnaire, 65% of those surveyed
came from countries in Europe and
North America.

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Private Equity Fund Management

Thursday, February 8, 2018
SPECIAL FEATURE: 2018 PUERTO RICO INVESTMENT SUMMIT
19
SPECIAL FEATURE | SPECIAL ADVERTISING SECTION
2018 PUERTO RICO
INVESTMENT SUMMIT

Thursday, February 8, 2018
SPECIAL FEATURE: 2018 PUERTO RICO INVESTMENT SUMMIT
21
contents
Incentives 22
Education 26
Concierge 32
Insurance 34
Healthcare 35
St. Regis Bahia Fern terrace
Moving Around 38

22 SPECIAL FEATURE: 2018 PUERTO RICO INVESTMENT SUMMIT Thursday, February 8, 2018
P.R.-U.S. Income-Tax Benefits
Under Acts 20 & 22 and U.S. Internal Revenue Code
Tax benefits are both as good as they seem and legally available.
Port of San Juan
Port of San Juan
“
BY CB STAFF
It’s too good to be
true.” This is the
typical reaction when
individuals first hear about
the income-tax benefits
available to them if they
become bona fide residents
of Puerto Rico. However, the
fact is that the tax benefits
are both as good as they
seem and legally available,
pursuant to the interplay
between certain provisions
of the U.S. Internal Revenue
Code (IRC), as amended, and
Puerto Rico’s Act to Promote
the Transfer of Investors to
Puerto Rico (Act 22-2012),
as amended, and Act to
Promote the Exportation of
Services, as amended (Act
20-2012).
As a result of this interplay,
individuals who move to
the island enjoy U.S. and P.R.
income-tax exemption on
interest and dividends from
sources within the island and
on certain short- and longterm
capital gains from the
sale of securities and, if such
individuals use certain legal
entities to render certain
services from Puerto Rico to
nonresidents of the island,
the fees derived from such
services are exempt from U.S.
income tax and subject only
to a 4 percent Puerto Rico
income tax.
A wide array of individuals
may benefit from these
tax-savings opportunities.
U.S. citizens and residents,
who derive a significant
portion of their income from
capital gains from the sale
of securities (e.g., high-networth
individuals, traders in
securities and hedge-fund
managers), are among the
individuals for whom moving
to Puerto Rico may result in
exemption from the island’s
income tax and from the
maximum federal incometax
rate of 40.8 percent (37
percent maximum ordinary
income-tax rate + 3.8 percent
Obamacare tax on “net
investment income”) and
the 23.8 percent (20 percent
maximum capital gains tax
+ 3.8 percent Medicare tax)
on short- and long-term
capital gains from the sale
of securities, respectively,
plus exemption from the
applicable state income tax.
Individuals who organize
certain legal entities or are
equity holders of certain
existing legal entities that
engage in business activities,
such as providing financial
or business consulting
services, development and
sale of software, internet
marketing, call centers and
other services, may also
enjoy significant income-tax
benefits, so long as the
individuals become bona fide
residents of Puerto Rico; the
services have no nexus with
Puerto Rico and are rendered
from the island to non-
Puerto Rico clients.
In these cases, the benefits
to the individuals who move
to the island to provide
such services consist of a
reduced 4 percent Puerto
Rico income tax plus a 0.2
percent municipal grossreceipts
tax and exemption
from federal income tax.
Individuals who are also
providers of the services
must receive a fully taxable,
arm’s-length salary for their
services, but the remaining
income will only be subject
to the 4 percent Puerto
Rico income tax and a 0.2
percent gross-receipts tax.
Owners of other types of
businesses with operations
in the U.S. that become
bona fide residents of
Puerto Rico may also enjoy
these benefits by providing
eligible services to the
stateside entity from Puerto
Rico. In these cases, the tax
savings hinge on the amount
of fees that may be charged
for the services rendered in
Puerto Rico under Internal
Revenue Code, as amended
(P.R.-IRC)section 482 (i.e.,
the fees that would be paid
to an unrelated third party
for the same services).
We will now summarize
the requirements that must
be met to enjoy the foregoing
Puerto Rico and United
States tax benefits.
PUERTO RICO INCOME-
TAX BENEFITS
Act 22-2012
A. In General. The Puerto
Rico income-tax exemption
on interest, dividends and
capital gains is granted
by Act 22. The exemption
is applicable to interest
and dividend income and
certain short- and long-term
capital gains from the sale
of securities of individuals
that (i) become residents
of Puerto Rico after Jan.
17, 2012; (ii) had not been
domiciled in Puerto Rico at
any time during the six-year
period ending Jan. 17, 2012;
(iii) obtain a grant of tax
exemption from the Secretary
of Economic Development
& Commerce of Puerto Rico
(Act 22 Grant).
B. The Act 22 Grant. The
Act 22 Grant is a contract
between the individual and
the Government of Puerto
Rico. The treatment of the
Act 22 Grant as a contract is
aimed at making applicable
section 7 of article II of the
Continues on page 24

24 SPECIAL FEATURE: 2018 PUERTO RICO INVESTMENT SUMMIT Thursday, February 8, 2018
Continued from page 22
Hato Rey Milla de Oro Financial
Constitution of Puerto Rico,
which bars the impairment
of contractual rights, so as
to protect the tax benefits
of Act 22 from revocation or
amendment by future Puerto
Rico laws.
A $5,000 fee is payable
upon the approval of the Act
22 Grant and the Grantee
must donate $5,000 annually
to Puerto Rico charitable
organizations.
C. Resident of Puerto
Rico. The Act expressly
provides that the exemption
on interest, dividends and
capital gains is granted
to resident individuals,
as defined in section
1010.01(30) of the P.R.-IRC
of 2011, as amended. Section
1010.01(30) defines such
term as an individual who is
domiciled in Puerto Rico, and
provides that an individual
shall be presumed to be
domiciled in Puerto Rico
if the individual has been
present in Puerto Rico for
a period of 183 days during
the calendar year. It further
provides that the Secretary
of the Puerto Rico Treasury
will promulgate regulations
setting forth the factors that
must be taken into account
in determining whether the
individual is domiciled in
Puerto Rico. Because of the
absence of such regulations,
there was uncertainty as to
the requirements that had to
be met to qualify as a resident
of Puerto Rico for purposes
of Act 22. To eliminate such
uncertainty, the Act 22 Grant
provides that if the individual
meets the IRC requirements
for bona fide Puerto Rico
residency, the individual will
also qualify as a Puerto Rico
resident under the P.R.-IRC.
D. Capital Gains. The
Puerto Rico income-tax
exemption on short- and
long-term capital gains is
applicable to gains from
the sale or exchange of
securities, attributable to
the increase in value of the
securities after the date that
the individual establishes
domicile in Puerto Rico.
Thus, gains realized from
securities acquired after
establishing domicile in
Puerto Rico are exempt
from Puerto Rico income tax,
whereas gains derived from
securities acquired prior
to establishing domicile in
Puerto Rico are exempt only
to the extent that the gain is
attributable to the increase
in value of the securities after
the individual is domiciled
in Puerto Rico. The portion
of the gain attributable
to the increase in value
of the securities prior to
establishing domicile in
Puerto Rico is subject to
the applicable Puerto Rico
capital-gains tax rate, but,
if such gain is recognized
after 10 years from the date
that the individual becomes
domiciled in Puerto Rico, a
reduced 5 percent tax rate
is applicable.
E. Exemption Period.
The income-tax exemption
commences on the date of
the individual’s domicile in
Puerto Rico and ends on the
earlier of Dec. 31, 2035, or
the date the individual(s)
cease(s) to be domiciled in
Puerto Rico.
Act 20-2012
A. In General. Act 20
imposes a 4 percent incometax
rate, in lieu of any other
Continues on page 25

Continued from page 24
Puerto Rico income tax, and
grants other tax benefits
to any entity that renders
certain eligible services from
the island to markets outside
of Puerto Rico.
B. Eligible Services. The
following types of services
are among those that qualify
for the tax benefits of Act 20,
provided that the services
are rendered to nonresidents
and the “no nexus” with
Puerto Rico requirement
is met: (i) research and
development; (ii) advertising
and public relations; (iii)
economic, environmental,
technological, scientific,
management, marketing,
human resources,
information and audit
consulting; (iv) advisory
services on matters relating
to any trade or business;
(v) commercial arts and
graphic services; (vi) the
production of construction
drawings, architectural
and engineering services,
and project management;
(vii) professional services,
such as legal, tax and
accounting services; (viii)
corporate headquarters;
(ix) electronic dataprocessing
centers; (x) the
development of computer
programs; (xi) voice and
data telecommunications
between persons located
outside of Puerto Rico; (xii)
call centers; (xiii) services
provided by shared services
centers, including but not
limited to, accounting,
finance, taxes, auditing,
marketing, engineering,
quality control, human
resources, communications,
electronic data processing
and other centralized
management services; (xiv)
storage and distribution
centers; (xv) educational
and training services; (xvi)
hospital and laboratory
services; (xvii) certain
creative industries (xviii)
trading centers; (xix)
investment banking and
other financial services; and
(xx) any other service that
the government of Puerto
Rico determines should be
treated as an eligible service.
Thursday, February 8, 2018
C. The Act 20 Grant. To
enjoy the tax benefits of Act
20, a grant of tax exemption
must be requested and
issued by the Secretary of
Economic Development &
Commerce of Puerto Rico.
This grant of tax exemption
is also a contract with the
Government of Puerto Rico
that should be protected from
revocation or amendment by
subsequent legislation by the
constitutional prohibition
against the impairment of
contracts by legislative action.
D. Tax Benefits. Pursuant
to the Act 20 tax-exemption
grant, the Puerto Rico
corporation or limited
liability company, created by
the individual who moves to
Puerto Rico, will enjoy the
reduced 4 percent Puerto
Rico income-tax rate and
60 percent exemption from
municipal-license taxes
during a 20-year period.
The 20-year period may be
extended for 10 additional
years if certain requirements
are met.
E. Compensation
vs. Dividend Income.
Individuals who organize a
Puerto Rico corporation to
generate dividend income
exempt from the island’s
and the U.S.’ income tax, and
also render services to the
company must receive a
salary that will be subject to
Puerto Rico income tax at a
maximum income-tax rate
of 33 percent. Otherwise,
the Treasury Department
could characterize a portion
of the exempt dividends as
taxable compensation for
services rendered, pursuant
to P.R.-IRC section 1040.09
(equivalent to IRC section
482). The salary must be a
market salary (i.e., the salary
that a similar company
in Puerto Rico would pay
for equivalent services
to an individual who is
not a shareholder) up to a
maximum of $350,000.
U.S. INCOME-TAX
BENEFITS
Interest, Dividends
& Capital Gains from
the Sale of Securities.
Pursuant to IRC sections
933 and 937, bona fide
SPECIAL FEATURE 25
residents of Puerto Rico
during the “entire” calendar
year are not subject to
federal income tax on
their income from sources
within the island that is
not effectively connected
with a U.S. trade or business.
Thus, interest, dividends
and capital gains from the
sale of certain securities
that are exempt from Puerto
Rico income tax under Act
22 are also exempt from
federal income tax if (i)
the individual meets the
requirements of IRC section
937 to become a bona fide
resident of Puerto Rico
during the entire taxable
year, and (ii) the interest,
dividend and capital gains
are from sources within
Puerto Rico pursuant to the
IRC source of income rules.
Service Fees. Under the
IRC, corporations organized
outside of Puerto Rico are
not subject to federal income
tax, unless they are engaged
in trade or business in the
U.S. or derive certain income
from sources within the U.S.
In addition, dividends from
a Puerto Rico corporation
that substantially derives all
of its income from services
rendered on the island
constitute income from
sources within Puerto Rico.
Consequently, a corporation
organized under the laws of
Puerto Rico that is subject
to Act 20’s Puerto Rico 4
percent income-tax rate
is not subject to federal
income tax, if substantially
all of its income is derived
from services rendered from
Puerto Rico. Additionally,
the dividends paid to bona
fide residents of Puerto Rico
that are exempt under Act
20, are not subject to federal
income tax pursuant to IRC
sections 933 and 937.
Moreover, if the entity
that enjoys the Act 20 tax
benefits is a pass-through
or disregarded entity under
the IRC, the individual bona
fide resident of Puerto Rico
who is subject to Act 20’s 4
percent Puerto Rico income
tax on the entity’s income is
not subject to federal income
tax on such income; provided
the services are rendered
from Puerto Rico.
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26 SPECIAL FEATURE: 2018 PUERTO RICO INVESTMENT SUMMIT Thursday, February 8, 2018
Top Bilingual Private Schools
Despite the ravages caused by Hurricane Maria, these top-tier schools are up and running. These are some top private schools in Puerto Rico,
many of which teach in English or are bilingual Spanish-English. Many of these private schools also have a college-prep program, along with many
extracurricular and athletics offerings. The following is an alphabetical list of top private schools in the San Juan-metro area and other municipalities.
Academia Perpetuo Socorro
Academia del Perpetuo Socorro, in the historic Miramar
neighborhood of San Juan, offers a strong Kindergarten-12th
grade academic program. The school’s focus is traditional and
courses are offered in Spanish and English interchangeably.
The school is oriented toward a Catholic education but this is
not a requirement. A strong athletics department, extracurricular
activities, theater and travel programs are also available.
American Military Academy
The American Military Academy is a bilingual school,
which uses new platforms (iPads and tablets) in lieu of
books. There are university-level courses for students in
grades 10-12. Located in Bayamón, the school has a strong
athletics department. Community service is compulsory
before graduation.
The American School
Located in Bayamón for over 30 years, the American School
has aimed to provide an academic experience in tune with
today’s cutting edge of discoveries in science technology, communications
and exploration in English. With an enrollment
of about 800 students, its dedicated staff and administration
nurture the school’s demanding intellectual culture.
Baldwin School
Baldwin School is an independent, nonprofit, nonsectarian,
college-preparatory, English-language school in Guaynabo.
The curriculum is demanding since its mission is to challenge
students to become creative thinkers. Baldwin has up-to-date
technology resources, an exceptional green campus and facilities,
and a community that fosters character building as well
as accomplishments in the arts, service, athletics and global
understanding.
Colegio San Ignacio de Loyola
Founded in Guaynabo in 1952, CSI has formed generations
of young men through the five pillars of Jesuit
education: intellectual competency, openness to growth,
lovingness, religiosity and commitment to social justice.
Anchored in these values, CSI aims to provide a wellrounded
education, diverse extracurricular activities and
community-service opportunities.
Commonwealth-Parkville School, CPS
A college-preparatory co-educational day school with instruction
in English and a strong program in Spanish, CPS
has nearly 700 students on two safe and nurturing campuses:
Parkville (pre-prekindergarten to sixth grade) in Guaynabo
and Commonwealth (seventh to 12th grades) in San Juan’s
Hato Rey district. Small classes allow teachers to identify each
child’s unique interests, strengths, goals and learning styles.
Many changes have been made to its structure to accommodate
new technology and green spaces clearly designed for
students.

Thursday, February 8, 2018
SPECIAL FEATURE: 2018 PUERTO RICO INVESTMENT SUMMIT
27
Robinson School
Located in the heart of San Juan’s exclusive Condado
neighborhood, Robinson School has been a center of knowledge
and learning for generations of families since 1902.
From preschool through 12th grade, the school includes a
college-preparatory program with a Regular, Honors and Advanced
Placement curriculum.
St. John’s School
For a century, Saint John’s School has prided itself on creating
a unique learning environment that actively encourages
the potential for individual excellence in every student. Characterized
by small-class sizes (about 15 students per class)
from pre-prekindergarten through 12th grades. Located in
San Juan’s Condado neighborhood, the school prides itself on
graduating the most Ivy League candidates from the island.
TASIS
The TASIS School in Dorado is a private, nonsectarian,
co-educational day school that has English as its language of
instruction. The school is affiliated with The American School
in Switzerland (TASIS) in Europe, and has about 800 students
in pre-prekindergarten through 12th grade. Designed within a
vast space of land, the school’s campus is very accommodating
and offers itself for future growth.
COLEGIO SAN IGNACIO DE LOYOLA
MATRÍCULA
ABIERTA
Aún estas a tiempo.
Comunícate al 787.765.3814
o escribe a admisiones@sanignacio.pr
para coordinar una visita
y conocer más sobre nuestro Colegio.
Excelencia. Fe. Liderazgo. Servicio. Los encuentras en todo lo que hacemos. HOMBRES AL SERVICIO DE LOS DEMÁS.
Teléfono 787.765.3814 • www.sanignacio.pr • 1940 Calle Saúco • Urb. Santa María • San Juan • PR 00927 • Síguenos en:

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30 SPECIAL FEATURE: 2018 PUERTO RICO INVESTMENT SUMMIT Thursday, February 8, 2018
PUERTO RICO’S LARGEST PRIVATE SCHOOLS
(Listed According to Total Enrollment in School Year 2016-2017)
Current/
Previous
Ranking
School Name
Telephone/Fax
Internet/Email Address
1/2 Saint Francis School
(787) 762-3141 / (787) 750-7920
www.saintfrancispr.org
2/1 Colegio Católico Notre Dame
(787) 743-3693 / (787) 258-9648
www.ccnd.org
3/3 Colegio Marista de Guaynabo
(787) 720-2186 / (787) 720-7020
www.maristasguaynabo.org
4/5 Carvin School Inc.
(787) 757-6950 / (787) 757-7570
www.carvinschoolinc.com
5/7 Academia Cristo de los Milagros
(787) 743-4242 / (787) 746-1428
www.yoencristo.com
6/4 Cupeyville School
(787) 761-6305 /
www.cupeyvilleschool.org
7/6 Academia del Perpetuo Socorro
(787) 724-1447 / (787) 725-6503
www.aps-pr.org
8/8 American Military Academy
(787) 720-6801 / (787) 720-6841
www.amapr.org
9/9 A cademia Bautista de Puerto Nuevo
(787) 782-4072 / (787) 781-1901
www.abpnpr.com
10/11 Wesleyan Academy
(787) 720-8959 / (787) 790-0730
www.wesleyanacademy.org
11/10 Colegio Bautista de Caguas
(787) 743-3721 / (787) 743-5545
www.cbcaguas.org
12/- C olegio Evangélico Capitán Correa
(787) 878-9227 / (787) 880-0395
www.capitalcorrea.org
13/12 Colegio De La Salle
(787) 785-7150 / (787) 785-7330
www.delasallebayamon.com
14/15 Saint John’s School
(787) 728-5343 / (787) 268-1454
www.sjspr.org
15/14 Baldwin School of P.R.
(787) 720-2421 / (787) 790-0619
www.baldwin-school.org
16/16 The Tasis School in Dorado
(787) 796-0440 / (787) 796-0240
www.tasisdorado.com
17/13 Academia Discípulos de Cristo
(787) 799-7717 / (787) 799-7771
www.academiadiscipulos.org
18/18 Dorado Academy
(787) 796-2180 / (787) 796-7398
www.doradoacademy.org
19/23 Commonwealth-Parkville School
(787) 765-4411 / (787) 764-3809
www.cpspr.org
20/22 Southwestern Educational Society
(787) 834-2150 / (787) 265-2500
www.sesolion.com
Physical Address
Villa Carolina Urb.
400 Roberto Clemente Ave.
Carolina 00985
34 Troche St.
Caguas 00725
Alturas de Torrimar
6 Marcelino Champagnat St.
Guaynabo 00969
Natividad Landrau St.
Carolina 00987
85 Luis Muñoz Marín Ave.
Caguas 00725
Cupey Bajo
Rd. 844, Km. 0.4
Río Piedras 00926
704 José Martí St.
Santurce 00907
Rd. 177, Km. 6.8
Guaynabo 00969
1136 Jesús T. Piñero Ave.
San Juan 00920
Rd. 838, Km. 1.6
Guaynabo 00969
Bo. Cañaboncito
Rd. 784, Km. 2.0
Caguas 00727
Bo. Carrizales
Rd. 493
Hatillo 00659
Riverview Urb.
S an Juan Bautista
De La Salle St.
Bayamón 00961
1454 Ashford Ave.
Condado 00907
Los Filtros Ave.
Rd. 833, Km. 13.1
Guaynabo 00969
Sabanera Urb.
11 Rd. 693
Dorado 00646
Montañez Urb.
Rvdo. Florentino Santana St.
Bayamón 00957
Dorado del Mar Urb.
100 Madre Perla St.
Dorado 00646
Roosevelt Urb.
100 Castillo St.
Hato Rey 00918
Cuba Sector
Rd. 108, Km. 3.2
Mayagüez 00680
Total
Enrollment
2016-2017
Year
Founded
Enrollment
Fees $
Tuition:
Number/
Payments
1,764 1973 460-490 10/
310-320
1,740* 1916 945-995 N/P
295-315
1,300 1964 1,050-1,350 10/
515-595
1,200 1970 585-1,095 10/
270-335
1,105 1982 730-825 10/
225-285
1,044 1963 2,005-2,260 10/
395-650
1,025 1921 1,910 9/
620-815
967 1963 750-950 10/
525-745
960 1956 625 10/
275
878 1955 675-1,075 10/
460-500
864 1950 575 10/
262-272
863 1965 1,000-1,200 10/
225
850 1962 260-270 10/
260-280
844 1915 1,000 Based on
grade
815 1968 10,000-
15,000
Based on
grade
793 2002 850-1,000 2/
9,830-
12,641
785 1955 450-550 10/
255-315
727 1972 770-2,120 10/
410-460
707 1952 375-1,500 1,2,10/
6,360-
11,548
686 1973 330 10/
350
Registration
Period
November-
February
As Ranked by
Language
of Instruction
English Spanish Other
Top Executive
Title
50% 50% - Viviam Salib
Director
N/P 60% 40% - Rev. Terrance E. Wall
Board President
January-
February
25% 70% 5% Balbino Juárez
President
All year 75% 15% 10% Carmen Philp
Executive Director
November-
February
January-
May
October-
February
February-
May
January-
May
December-
August
January-
March
60% 40% - Leonides Parrilla
General Director
80% 20% - Ana Pagán
Director
50% 50% - Fr. Juan Santa
Principal/Director
75% 25% - Juan C. Consuegra
CEO
50% 50% - Iris De León Ruiz
Executive Director
90% 10% - Rev. Fernando Vázquez
Headmaster
40% 60% - Damaris Santos Santos
Executive Director
All year 20% 75% 5% Juan C. Santiago
Executive Director
November-
January
- 100% - Evelyn Agosto
Director
All year 80% 15% 5% Lorraine Lago
Head of School
All year 95% 4% 1% James Nelligan
Headmaster
All year 80% 10% 10% Timothy Howard
Headmaster
November-
July
25% 75% - Abraham Masquida
General Manager
January 100% - - Nancy Escabí
Head of School
All year 100% - - Alan P. Austen
Head of School
All year 90% 8% 2% Wanda Ayala de Torres
Director
®

Thursday, February 8, 2018
SPECIAL FEATURE: 2018 PUERTO RICO INVESTMENT SUMMIT
31
PUERTO RICO’S LARGEST PRIVATE SCHOOLS
(Listed According to Total Enrollment in School Year 2016-2017)
Current/
Previous
Ranking
School Name
Telephone/Fax
Internet/Email Address
21/19 Colegio Sagrado Corazón de Jesús
(787) 765-9430 / (787) 765-5267
www.cscjpr.com
22/23 American School
(787) 780-2501 / (787) 740-0737
www.americanschoolpr.com
23/20 Colegio Ponceño Inc.
(787) 848-2525 / (787) 259-4282
www.copin.net
24/17 Colegio San Antonio de Padua
(787) 764-0090 / (787) 763-7592
www.csa.edu.pr
25/21 Colegio San Ignacio de Loyola
(787) 765-3814 / (787) 758-4145
www.sanignacio.pr
26/28 Robinson School
(787) 999-4604 / (787) 726-2833
www.robinsonschool.org
Physical Address
University Gardens Urb.
215 Palma Real St.
Río Piedras 00927
Hermanas Dávila Urb.
C-1 9th St.
Bayamón 00959
Bo. Cerrillo
Rd. 14, Km. 6.3
Coto Laurel 00780
216 Arzuaga St.
Río Piedras 00928
Santa María Urb.
1940 Saúco St.
Río Piedras 00927
5 Nairn St.
Santurce 00907
Total
Enrollment
2016-2017
Some fees shown may not include additional charges per family. Check with the institution for further details.
Unless otherwise noted, all information was provided by the schools.
Research by Marilda A. Quiñones del Castillo
Copyright © 2017 CARIBBEAN BUSINESS
Year
Founded
Enrollment
Fees $
Tuition:
Number/
Payments
674 1963 1,046-1,368 10/
300
670 1977 1,814-2,191 8/
262-284
668 1926 175 10/
365-414
647 1928 1,495-1,740 9/
425
637 1952 975 1/
9,600
610 1902 3,400-3,900 10/
1,240
Registration
Period
As Ranked by
Language
of Instruction
English Spanish Other
Top Executive
Title
February 50% 50% - Fr. Anulfo del Rosario
Director
All year 100% - - Doris Bello
President/Headmaster
February-
April
October-
February
January-
August
25% 75% - Fr. Emilio Sotomayor
Director
50% 50% - Sister María Ramón
Director
14% 85% 1% Flavio I. Bravo
President
February 90% 8% 2% Cindy Ogg
Head of School
®
Somos
Bisontes.
En la American
caminamos
con paso firme.
LaAmerican.com |
American Military Academy - PR
787.720.6801 | 787.720.8915 | Carr. 177, Ave. Lomas Verdes, Guaynabo

32 SPECIAL FEATURE: 2018 PUERTO RICO INVESTMENT SUMMIT Thursday, February 8, 2018
BY CB STAFF
Investment opportunities
in Puerto Rico not
only present a chance
for entrepreneurs to
expand their businesses,
but also experience what
the “Island of Enchantment”
has to offer. And to
enjoy their time in Puerto
Rico with the high level of
convenience and style to
which they are accustomed,
Quintessentially Lifestyle,
a concierge service firm
based in London and offices
in more than 60 cities
around the world, set up
shop on the island to cater
to both members who are
visiting Puerto Rico or even
calling the island home.
Conversations to establish
a Quintessentially office
in Puerto Rico began
about two years ago in London,
partly due to the influx
of wealthy investors to
the island. Once they were
Quintessentially Lifestyle Offers
a Unique Puerto Rico Experience
given the go-ahead, four
San Juan-based investors set
things in motion by investing
about $500,000 to set up
the local office.
Founded in 2000 by Aaron
Simpson, Paul Drummond
and Ben Elliot—the
nephew of Camilla, the
Duchess of Cornwall—
Quintessentially has rapidly
become one of the most
noteworthy companies in
its class worldwide, earning
accolades from publications
such as Condé Nast Traveler
and the New York Times.
Overall, the firm boasts offices
in markets from Brazil
to Mongolia, including expansions
into China.
The company styles itself
as a “lifestyle management”
firm, combining aspects of a
concierge service and a personal
assistant for private
and corporate members, 24
hours a day, 365 days a year.
It brings together specialist
advice and knowledge,
insider access and exclusive
privileges, enabling everything
from everyday needs
to life’s defining moments,
facilitating every member’s
requests, solving pressing
practical problems and
helping in all-important
lifestyle decisions.
For private clients, the
company offers three
membership levels. The
Elite package, geared toward
frequent travelers,
puts at members’ beck and
call a team of so-called
“lifestyle managers” in different
areas of the globe,
who are experts in their respective
markets. The company
has about 2,000 lifestyle
managers worldwide,
each with a specific number
of clients they serve.
The number of clients that
a lifestyle manager has is
kept at a strict cap to ensure
quality of service.
The Dedicated level assigns
a lifestyle manager
who takes a proactive role
and gets to know the client’s
preferences and catering
needs. For instance, if a Dedicated
member is passionate
about the arts, a lifestyle
manager would not only take
care of the day-to-day, but he
or she would also keep the
client informed about the
latest art-related events and
find out how to get access to
those events.
Lastly, the General package
is the least expensive offering
and thus takes a more
reactive instead of proactive
role. For example, clients in
the General tier can call for
exclusive dinner reservations
and have flowers sent
to respective restaurants at
specific times.
As part of launching its
operations in Puerto Rico,
the firm began offering an
exclusive package for the
local market, Q Puerto Rico
VIP Pass. The package provides
services that are specially
catered for those who
are considering moving to
the island. The services include
coordinating air travel,
hotel and transportation
arrangements, as well as
scheduling meetings with
local real-estate, tax, financial
and legal experts.
For those who already
have decided to move to
Puerto Rico, the firm also
offers relocation and expeditor
services as part of the
VIP package. These range
from providing information
on procedures required for
obtaining residency status,
facilitating the necessary
documents, helping to initiate
contacts with local banks,
insurance brokers, lawyers
and health providers, as well
as expediting utilities, cable
and other essential services.
Recommendations on lifestyle
and unique luxury experiences
in Puerto Rico are
also offered.
Thus, Quintessentially
Lifestyle Puerto Rico not
only provides important
services to clients here on
the island, but also plenty
of work to local companies
it subcontracts. In fact,
the company has members
who have decided to invest
in the island in great
part due to the experience
the company has provided
in Puerto Rico. For additional
information, Lauren
Brown at lauren.brown@
Quintessentially.com.

34 SPECIAL FEATURE: 2018 PUERTO RICO INVESTMENT SUMMIT Thursday, February 8, 2018
Role of Insurance
in Health and
Economy
BY CB STAFF
Puerto Rico’s insurance industry
continues to play a
leading role in the island’s
financial services sector.
A clear indicator is the amount of
total subscribed premiums, which
in 2011 reached $10.23 billion. The
local insurance market continues
to be dominated by local insurers
and health service organizations
(HSOs), which subscribed more
than 90% of local premiums in
2011. At the end of 2010, Puerto Rico’s
insurance industry comprised
35 local and 218 nonlocal insurers,
13 HSOs and one reinsurer (See related
story, p. 8)
Additionally, there are 8,800 producers
and authorized representatives,
general agents, adjusters,
solicitors, managers and others.
The island’s insurance industry is
supervised and regulated by the
Insurance Commissioner’s Office
(OIC by its Spanish acronym),
which regulates some 9,000 individuals
and corporations that work
in Puerto Rico’s industries. Currently,
the OIC is promoting the
implementation of a Health Insurance
Code for Puerto Rico. As part
of the code, the OIC will promote
the adoption of a new law applicable
to HSOs, whereby, among
other things, new minimal capital
requirements will be enacted to be
more in tune with the market. The
OIC is also in the process of implementing
the U.S. Affordable Care
Act to determine the rationale behind
medical plan rates.
Since 1993, Puerto Rico has adopted
a Medicaid managed care
system, with a plan known as “La
Reforma.” In 2010, the island reformed
its public healthcare system
and the government’s health
plan for the medically indigent
is now called “Mi Salud.” All Mi
Salud beneficiaries are enrolled
in a managed care program. As of
2016, almost half of the population
of Puerto Rico is covered by Medicaid
(Mi Salud), with an additional
11% covered by Medicare.
According to the website medicare.gov,
Mi Salud is offered
through one local, for-profit plan,
Triple-S, and behavioral health
through a national for-profit plan,
APS, both available islandwide.
Medicare programs are offered
through several for-profit plans
including local plans such as
First Medical, MCS, MCS, MMM
Healthcare and PMC Medicare
Choice, and national plans such
as Humana and Blue Cross/Blue
Shield Associate4 Triple-S.
The government also has contracts
with pharmacy-benefit
management companies to provide
prescription drugs to Mi
Salud beneficiaries. These companies,
or managed care organizations,
are reimbursed through
a combination of capitated and
fee-for-service payments, which
cover primary and specialty care
respectively. Plans on the island
are selected through a competitive
procurement process.

Thursday, February 8, 2018
SPECIAL FEATURE: 2018 PUERTO RICO INVESTMENT SUMMIT
35
Excellent Facilities, World-Class Physicians
Auxilio Mutuo
Hospital
BY CB STAFF
Medical services
in Puerto Rico
have done
away with the
notion that you have to travel
to the mainland U.S. to receive
quality healthcare.
Excellent physicians, facilities
and technology have
transformed Puerto Rico
during the past 20 years into
a place that possesses highquality
health resources run
by some of the world’s best
doctors, who are overseeing
the development of topnotch
medical teams performing
highly complex procedures
with a tremendous
success rate.
Liver, kidney and heart
transplants are being routinely
performed with high
precision, and oncology
treatment is on the cutting
edge, with new equipment
to help more effectively diagnose
and treat cancer.
The excellent education
received in local medical
schools, such as the University
of Puerto Rico School
of Medicine in San Juan and
the Ponce Health Sciences
University, located in the
southern region, is thorough
and relevant, turning out
top-notch medical doctors.
Sophisticated
surgery
commonplace
One of the best examples
of the growing level of medical
sophistication in Puerto
Rico over the past decade
is that surgical procedures
such as cardiovascular and
transplant operations have
become commonplace. Various
institutions in Puerto
Rico carry out bypass surgery
and cardiac catheterization
and angioplasties.
Some of these are Auxilio
Mutuo Hospital in San Juan;
the Advanced Cardiology
Center in Mayagüez; the
Cardiovascular Center for
Puerto Rico & the Caribbean
Hospital in Río Piedras,
San Juan; the Pavía Heart
& Lung Center in San Juan;
HIMA-San Pablo Hospital’s
pioneering Cardiovascular
Institute in Bayamón; the
Cardiovascular Institute
of San Lucas Episcopal
Hospital in Ponce; and the
Veterans Affairs Medical
Center in San Juan.
In Bayamón, there is Hospital
Hermanos Meléndez,
with a tremendously successful
cardiovascular and
thoracic surgery record,
and its modern Puerto Rico
Children’s Hospital.
Hospital San Jorge in
San Juan is also renowned
for its pediatric services.
San Jorge’s interiors featuring
colorful murals
designed to put children
at ease and videogames in
waiting rooms remind one
of the Miami Children’s
Hospital—a top-notch facility
in its own right.
Ashford Presbyterian
Community Hospital, also
known as El Presby, in San
Juan’s Condado community,
is widely recognized for its
neonatal services, women’s
health-related services and
wound center.
HIMA-San Pablo, a network
of islandwide hospitals,
is a local trendsetter
in cardiovascular care and
has been setting the pace
as one of the first hospitals
Continues on page 36

36 SPECIAL FEATURE: 2018 PUERTO RICO INVESTMENT SUMMIT Thursday, February 8, 2018
Pavia Hospital
Hato Rey
Advanced
technology
Among HIMA-San Pablo’s
successes is the implementation
of the Da Vinci Surgical
System, a highly advanced
robotic device that carries
out delicate and complex
head and neck surgeries.
Among the benefits of
the highly touted unit are
shorter hospital stays, minimal
invasive procedures, less
pain and blood loss and, in
some cases, better clinical
results.
The team at Auxilio Mutuo
Hospital’s transplant
center carried out the first
liver transplant in Puerto
Rico. The operation represented
the culmination
of a multimillion-dollar
liver transplant program.
The program required
putting together highly
skilled medical personnel in
specialties including anesthesia,
gastroenterology and
intensive care; acquiring
cutting-edge equipment;
and securing licenses.
Auxilio Mutuo’s strategy
has been to launch services
that were not available before
on the island by blending the
best human resources in the
field with the most advanced
technology. Such is the case
with its cancer center.
Staying
competitive in
important areas
When Auxilio Mutuo’s
center was inaugurated, the
top priority was to fulfill
unmet needs on the island
for excellent oncology care
in multiple disciplines. Because
profit was never the
primary goal of the center,
the first challenge was to
carry out the mission with a
modest budget.
In 2011, the Auxilio Mutuo
Cancer Center’s Breast Cancer
Program also received
the accreditation from the
National Accreditation
Program for Breast Cancer
Centers (NAPBC), becoming
the only center in the Caribbean,
and the first outside
the mainland U.S., to receive
such accreditation.
Another example of the
quality of local talent and
the general ability of healthcare
professionals to adapt
to patients’ needs is the
Cardiovascular Center at
HIMA-San Pablo Hospital in
Bayamón, which has a cardiology
department and an
invasive-cardiology division
that includes a cardiac catheterization
department.
Continues on page 37
Medical care
in Puerto Rico
in the past
two decades
has made it
unnecessary
to travel to
the mainland
U.S. for
healthcare.
Continued from page 35
to actively promote Puerto
Rico in the medical-tourism
industry. Adding to the list
of excellent cardiovascular
facilities is the Cardiovascular
Center for P.R. & the
Caribbean, where the first
heart transplant in Puerto
Rico was successfully performed
by Dr. Iván González
Cancel in 1999.
Children and
adolescents
Puerto Rico’s hospitals
have also established topquality
services when it
comes to children, from
birth to the first years of life.
Auxilio Pediátrico, at Auxilio
Mutuo Hospital, sports
the largest pediatric emergency
room in Puerto Rico
and two floors dedicated to
pediatrics care and services.
The hospital also has
El Niño Jesús Intensive
Neonatal Care Unit and a
Pediatric Care unit to attend
to babies with special
medical needs.
Meanwhile, Hermanos
Meléndez Puerto Rico
Children’s Hospital is solely
dedicated to the needs of
children and is the first
hospital designed exclusively
for children and
adolescents.
And while El Presby is the
first institution in Puerto
Rico that has been certified
as a “Child-Friendly Hospital,”
its fame as the “hospital
of births” is what truly showcases
this institution’s commitment
to children from
their first years of life. The
hospital, which averages 300
births a year, has a team of
neonatologists that are available
24 hours a day—and if
necessary, may assist in deliveries—as
well as advanced
telemetry technology that allows
the staff to keep tabs on
the mothers’ health status.

Thursday, February 8, 2018
SPECIAL FEATURE: 2018 PUERTO RICO INVESTMENT SUMMIT
37
Continued from page 36
The wound center at the
Ashford hospital in Condado
tends to wounds caused by
conditions such as diabetes,
and pressure ulcers caused
by patients spending extended
time bedridden as
they face certain health situations
or recover from them.
Renowned for its excellence
in the area of obstetrics, El
Presby has also moved into
offering other services.
Recently, the Caribbean
Spine & Research Institute,
the first private institution
specializing in spine surgery
in Puerto Rico, inaugurated
its new facilities in San Juan
to offer its services in alliance
with El Presby.
To stay competitive, hospitals
have to build their reputation
through the quality of
their services and their human
and technical resources.
In addition, most top doctors
with private practices also
work with Puerto Rico’s
main hospitals.
Although a vast majority
of the island’s hospitals and
medical clinics are concentrated
in San Juan, the
southern municipality of
Ponce and its surrounding
region has seen tremendous
healthcare advances and
now has many outstanding
facilities where advanced
medical procedures are carried
out and major medical
teaching facilities have been
established. Top-ranking
hospitals in the southern
region include Damas Hospital,
San Cristóbal Hospital
and Dr. Pila Metropolitan
Hospital in Ponce, Mennonite
Hospital in Aibonito
and Metro Pavía Yauco Hospital
in Yauco.
Medical care in Puerto
Rico in the past two decades
has made it unnecessary to
travel to the mainland U.S.
for healthcare and has even
created a large medical tourism
industry.
The impressive success
rate achieved by the superior
personnel overseeing the local
resources is a testimony
of how far the island has
come in the field of medicine,
while much more is
underway.
The Knowledge Corridor
sponsored by the
Puerto Rico Research, Science
& Technology Trust,
for example, which is in
the final planning stages,
will interconnect existing
and future academic and
research facilities that will
help increase knowledge
in the biotechnology and
medical fields, among others,
thus accelerating the
scope and size of the local
healthcare industry.
HIMA
San Pablo
Hospital

38 SPECIAL FEATURE: 2018 PUERTO RICO INVESTMENT SUMMIT Thursday, February 8, 2018
PUERTO RICO’S TOP TEN AUTO DEALERS
(Listed According to 2015 Gross Retail Sales)
Company Name
Telephone/Fax
Internet/Email Address
1/1 T riangle Dealers/Lexus de San Juan & Ponce
(787) 277-0717 / (787) 622-0830
www.triangledealers.com
2/2 Bella Group
(787) 620-7010 / (787) 620-7534
www.bellagroup.com
3/3 Autogermana BMW
(787) 474-7000 / (787) 765-4717
www.autogermanabmw.com
4/5 Auto Grupo
(787) 753-3000 / (787) 274-8460
www.autogrupopr.com
5/4 Cabrera Inc.
(787) 880-8080 / (787) 880-0502
www.cabreraauto.com
6/7 Garage Isla Verde LLC
(787) 620-1313 /
www.garageislaverde.com
7/6 Gómez Hermanos Kennedy LLC
(787) 993-3474 / (787) 277-0420
www.gomezhermanoskennedy.com
8/8 Grupo Felcon
(787) 652-1100 / (787) 652-1636
9/10 Autocentro Toyota (Autokirei Inc.)
(787) 999-9110 / (787) 756-8233
www.autocentrotoyota.com
10/9 Braulio Agosto Motors LLC
(787) 641-8934 / (787) 274-1130
www.braulioagosto.com
Physical Address 2015
Gross Retail
Sales $
Bechara Ind. Park
211 J.F. Kennedy Ave. Marginal
San Juan 00920
Bechara Ind. Park
Lot C-1, Segarra St.
San Juan 00920
298 Carlos Chardón Ave.
Hato Rey 00919
701 65th Infantry Ave.
Río Piedras 00929
Hwy. 2, Km. 82.2
Arecibo 00614
Baldorioty de Castro Ave.
Los Ángeles Marginal, Km. 10.3
Carolina 00979
Bechara Ind. Park
J.F. Kennedy Ave. Marginal, Km. 3.8
San Juan 00920
Hwy. 2, Km. 148
Mayagüez 00681
1088 Luis Muñoz Rivera Ave.
Río Piedras 00926
65th Infantry Ave., Km. 3.1
Río Piedras 00924
* CARIBBEAN BUSINESS estimate
Number of full-time employees includes part-time employees where applicable (every two part-time employees = one full-time employee).
Unless otherwise noted, all information was provided by the companies.
Research by Marilda A. Quiñones Del Castillo
Copyright © 2017 CARIBBEAN BUSINESS
As Ranked by
No. of Authorized Makes Sold Top Executive
Title
321,502,047 6 Lexus, Toyota, Honda, Nissan, Chrysler,
Dodge, Jeep, Ram, Fiat
Charles G. Vaillant
President
245,173,446 11 Honda, Acura, Mazda Carlos López-Lay
CEO/President
167,782,947 1 BMW, Mini Donald Guerrero
Vice President
148,000,000 11 Chrysler, Dodge, Jeep, Nissan, Kia, Fiat Gerardo Pascual
President
132,720,000* 3 Chrysler, Dodge, Jeep, Ram, GMC,
Ford, Nissan
Juan Colón Cabrera
President
128,500,000* 1 Mercedes-Benz, Smart Carlos Quiñones
President
120,485,833 6 Audi, Land Rover, Ferrari, Porsche,
Maserati, Lotus, Hyundai
Víctor M. Gómez III
President
80,595,134 3 Toyota, Ford José Feliciano
President
77,341,907 1 Toyota Donald Guerrero
President
55,201,556 1 Toyota Miguel A. Agosto
General Manager
®

Thursday, February 8, 2018
SPECIAL FEATURE: 2018 PUERTO RICO INVESTMENT SUMMIT
39
Car Rental
Abreeze Car Rentals - Vieques, 787-741-1856
ACE Rent A Car - Aguadilla, 787-890-8929
Acevedo’s Car Rental - Vieques, 787-741-4380
Alamo Car Rental - Aguadilla, 787-890-6075
Alamo Rent A Car SJU - 787-253-3299
Allied Car & Truck Rental - 787-726-7350; Aguadilla, 787-
890-3010; Condado, 787-725-5350; Dorado, 787-665-7755; Isla Verde,
787-728-8235
Angelo‘s Car Rental - Rincón, 787-823-3438
Avis Rent-a Car - 787-253-5926; Aguadilla, 787-890-3311; Ceiba,
787-885-0505; Condado, 787-721-4499; Culebra, 787-742-0726; Hatillo,
787-880-4225; Mayagüez, 787-805-5911; Ponce, 787-842-6154; Río
Grande, 787-657-1026; Vieques, 787-741-0284
B&E Car Rental - Vieques, 787-435-6488
Barranquitas Car Rental - Barranquitas,
787-857-7283 or 787-857-7020
Bella International Car Rental - 787-620-7484; Condado,
787-449-9522; Hato Tejas, 787-620-5860; Ave. Kennedy, 7878-620-7484;
Ponce, 787-651-4470
Budget Car Rental - 787-791-0600; Aguadilla, 787-890-1110;
Añasco, 787-826-4571; Ponce, 787-848-0907
Cabrera Car Rental - 787-791-4444
Cabrera Car & Truck Rental - 787-333-8444; Aguadilla; Carolina;
Hatillo; Isla Verde; Manatí
Carlos Jeep Rental - Culebra, 787-742-3514
Charlie Car Rental - 787-728-2418; Aguadilla, 787-890-8929;
Caguas, 787-743-2336;
Condado, 787-721-6525
Chepito’s Car Rental - Vieques, 787-649-2542
Coqui Car Rental - Vieques, 787-741-3696
Culebra UTV Rental - Culebra, 787-525-5456, 787-617-5304
Dollar Car Rental - 787-791-5500; Aguadilla, 787-890-3352; Isla
Verde, 787-253-7074; Miramar, 787-720-5000
Enterprise Rent-A-Car - 787-253-3722; Aguadilla, Arecibo,
Bayamón, Caguas, Condado, Fajardo, Guaynabo, Isla Verde, Mayagüez,
Ponce, Ponce Airport, Rio Grande, Río Piedras, San Juan Airport, San
Juan/Kennedy, Toll Free 1-877-416-0000 (Spanish), 1-800-261-7331 (24
hours)
Europcar - Carolina, 787-710-2777
E-Z Car Rental - Aguadilla, 787-890-3010
Fox Rent a Car - Aguadilla, 787-658-6286
Hertz Rent-a-Car - 787-791-0840 ; Aguadilla, 787-890-
5650; Caguas, 787-653-0091; Mayagüez, 787-851-3830; Old San Juan,
787-721-5127
Island Car Rental - Vieques, 787-741-8822
Island Jeep Rental - Vieques, 787-741-3318
Jerry’s Jeep - Culebra, 787-742-0587
Leaseway of P.R - 787-791-5900; Aguadilla, 393-292-4600; Cataño,
787-788-2727
Maritza Rental Car - Vieques, 787-741-0078 or 787-741-1666
National Car Rental - 787-791-1805; Aguadilla, 787-890-3732
Nü Car Rental - Carolina, 787-791-1160
PaylessCar.com - 787-625-8880
Popular Auto - 787-257-4848; Aguadilla, 787-890-4848; Bayamón,
787-785-4848; Caguas, 787-258-4848; Hato Rey, 787-763-4848; Humacao,
787-852-4848; Mayagüez, 787-265-4848; Ponce, 787-259-4848
Quality Car Rental - 787-791-3800
Sixt Car Rental - 787-791-1991; Aguadilla, 787-890-3395
SS Car Rental - San Sebastián, 787-896-1184
Target Rent-a-Car - 787-728-1447 or 800-934-6457; Barceloneta,
Bayamón, Caguas, Caparra, Cayey, Humacao, Palmas Del Mar, Río Piedras
Thrifty Car Rental - 787-253-2525; Aguadilla, 787-890-4070;
Fajardo, 787-860-2030; Mayagüez, 787-834-1590; Ponce, 787-290-2525
U Save Car & Truck Rental - 787-253-4008
Vias Car Rental of P.R. - 787-791-4120; Arecibo, 787-879-1132;
Dorado, 787-796-6404; Humacao, 787-852-1591; Club Cala de Palmas,
787-223-3448; Isla Verde, (Car & Bicycle Rental)
787-791-4120
Vieques Car & Jeep Rental - Vieques,
787-741-1037
World Car Rental - Fajardo, 787-860-4808
Z Rental Car - Bayamón, 787-778-0000
= Airport Shuttle Service

Thursday, February 8, 2018
SPECIAL ADVERTISING FEATURE
41
We Provide VALUE Through D E S I G N __ Thinking Outside The BOX to Re-Build Puerto Rico’s Future
email: eca@carrera-arq.com cel: 787.620.0475
website: carrera-arq.com

42 SPECIAL ADVERTISING FEATURE Thursday, February 8, 2018
CSA Group Showcases Global Reach
BY MARIO BELAVAL DÍAZ
For more than 60
years, CSA Group,
the local projectdelivery
and program-management
company
with worldwide reach, has
been a constant in the island’s
development.
The company was launched
in the 1950s during Operation
Bootstrap, which was the
government project aimed
at advancing Puerto Rico’s
economy into one that is developed
and industrial, in the
manufacturing sector. Since
then, it has been present in
significant private and public
development projects that
continue to propel the island’s
economy, as well as projects
in the mainland U.S. and Latin
America that prove Puerto
Rico has the talent and great
ideas to benefit the world. It
was in the 1990s that company
execs José Custodio and J.J.
Suárez took on the mission of
creating the largest engineering
firm in the mainland U.S.,
right here from the island.
“Who would have thought
that was possible?” asked
Fred Riefkhol, president
of CSA Group. “But with
vision, commitment and
experience, it was indeed
possible, and the company
grew in cities such as New
York, Philadelphia, Chicago,
Washington, Orlando and
Denver. This same vision
and strategy led CSA Group
to successfully enter the
Latin American market.”
In 2004, CSA Group
Fred Riefkhol, president of CSA Group.
launched an office in Panama,
and then went on to work on
significant projects in Mexico,
Honduras, Peru, Colombia,
Brazil and Argentina, and
closer to home, all throughout
the Caribbean Region.
Riefkhol was attracted to join
the company due to this same
dynamic commitment to
growth within the island and
beyond its shores.
“I saw an article about CSA,
a company that was daring to
compete,” Riefkhol said. “A
company looking to do mergers
and acquisitions and finance
projects to grow in the
U.S. Basically, what I read was
a job description for me and
the opportunity to work in a
wholly Puerto Rican company
with the vision and commitment
to expand all across
the Americas.”
Among projects CSA
Group has been involved
is the development of the
Puerto Rico Convention
Center in San Juan; the redevelopment
of Tocumen
Airport in Panama; the port
of Miami; more than 100
subway stations in New
York City and reconstruction
work in New York state
related to the effects of Hurricane
Sandy; and work as
structural designers of the
Philadelphia Eagles stadium
in Philadelphia.
The company is currently
involved in helping Puerto
Rico rebuild after María.
“The expertise of being in
this situation of managing
from a consulting and technical
point of view is a 20 year
history,” Riefkohl said, adding
that there is a grantee and
that there is an advisor to that
grantee, a company called
DCMC. Then there is “another
advisor, which is us advising
all the subgrantees in the
pooling of money.”
“We are a Puerto Rican
company, with 150 local employees
and 4,060 employees
in total, and you cannot support
this level of professional
manpower in these times if
you do not successfully diversify,”
Riefkhol said. “So, what
we have been doing is using
our center of excellence in
Puerto Rico to export to other
jurisdictions.”
• Cleaning and maintenance • Disinfection and sanitation
• Landscaping • Carpet and/or floor care maintenance
programs • Recycling program management
• Pest control • Sale and distribution of cleaning products
and equipment • Painting

Thursday, February 8, 2018
SPECIAL ADVERTISING FEATURE
43
Acts 20 & 22 Interplay With New U.S. Tax Reform
SPECIAL TO CARIBBEAN BUSINESS
Not long after the
passage of hurricanes
Irma and
Maria, Puerto
Rico is weathering another
storm with the approval of
the much-touted federal tax
reform that was signed into
law by President Trump Dec.
22, 2017.
“The Tax Cut & Jobs Act
is without a doubt the most
dramatic tax change in the
United States since the enactment
of the actual federal
tax code in 1986,” said
Francisco Luis, tax partner
at Kevane Grant Thornton.
“Individuals and businesses
in the United States will
have new rules that include
reduced tax rates, as well as
less and different deductions,
among other major changes.”
Nonetheless, the new international
tax rules of the
federal tax system have alerted
the international arena
because of its magnitude.
“We saw the intent to migrate
from the traditional
worldwide tax regime of the
federal tax system to a semiterritorial
regime, at least as
it relates to foreign subsidiaries
owned by corporations
in the United States by the
expansion of the ‘dividendreceived-deduction,’”
Luis
said. This allows the parent
company in the United
States, he added, to receive
tax-free dividends from their
foreign subsidiaries (there
is a transition tax to convert
to this semi-territorial tax
regime).
However, there are new
players in the federal tax law,
the so-called GILTI and the
BEAT. The GILTI (the acronym
for Global Intangible
Low-Taxed Income) in summary
inserts a new complex
formula to tax intangibles
in foreign jurisdictions that
are highly profitable with
low taxation. For its part, the
BEAT (the acronym for Base
Erosion Anti-Abuse Tax)
is a new tax to be imposed
on United States taxpayers
when transacting with related
entities in the foreign
arena.
Long before its enactment,
political campaigns
in the mainland U.S. had anticipated
these new federal
Francisco Luis, tax
partner at Kevane Grant
rules in the international tax
arena. Considering these reports,
Puerto Rico’s public
and private sectors engaged
intensively in continuous
lobbying efforts to insert
some preferential treatment
for Puerto Rico, in comparison
with the rest of the
world. Though these efforts
were unsuccessful, the truth
of the matter is that Puerto
Rico boasts a series of tax
incentives that make it a
prime location for careful tax
planning.
Specifically, both Acts 20
and 22 provide a series of
advantages to the abovementioned
international
taxes since the key factor for
their imposition is the presence
of related entities in the
United States and the foreign
jurisdiction.
Acts 20 and 22 are focused
on bringing new residents to
Puerto Rico and transforming
Puerto Rico into a service
center hub. Our island
still offers the interesting
combo, where individuals
are born United States citizens
and the entities created
in Puerto Rico are considered
foreign for U.S. tax purposes.
The U.S. tax reform
did not change this. The U.S.
Tax Code still maintains an
exclusion from federal taxation
for those that are Puerto
Rico bona fide residents regarding
the income that is
from sources within Puerto
Rico. One of the main attributes
of Act 22 is the 100%
exemption on capital gains
(in addition to the exemption
on interest and dividend income)
that has brought more
than 1,000 new residents to
Puerto Rico. Such advantages
are still valid.
Puerto Rico can still be an
important option because of
its political relation with the
United States, currency and
banking system.

44
SPECIAL ADVERTISING FEATURE Thursday, February 8, 2018
American Military Academy On Firm Path
SPECIAL TO CARIBBEAN BUSINESS
After Hurricane
Maria hit Puerto
Rico, American
Military Academy
(AMA), located in the
Guaynabo-Bayamón area,
benefited from the absolute
commitment and loyalty of
its entire teaching and administrative
team. Despite
the conditions, the school resumed
classes in record time,
three weeks, with extraordinary
assistance from both
employees and students.
Because of technology’s
importance to the school curriculum,
AMA invested in a
600-kilowatt generator to add
to its existing two generators.
With this significant purchase,
100% of the school’s
facilities can be energized
during a general blackout.
In the academic arena,
AMA also takes pride in announcing
that student Eduardo
González Santiago obtained
the maximum score in
the newly administered and
revised College Board Test
(PAA), out of 26,237 local
private and public students
tested in December. Among
the 3,656 students from private
schools, three were from
AMA and were recognized
in the 99th percentile. The
students are Andrea Rivera,
Alysa Alejandro and Eduardo
González. Once again,
American Military Academy
proves its academic excellence
through the wellknown
standardized test.
Founded in 1963 by Col.
Ramón Barquín, American
Military Academy continues
its mission of forging leaders
with civic, democratic and
spiritual values, who promote
society’s continuous transformation.
Located on 24 acres
with some 137,000 square feet
of facilities in lush surroundings,
the school straddles the
municipalities of Guaynabo
and Bayamón.
“Our educational philosophy
is centered on the
comprehensive and integral
development of human
beings,” Michelle Alfaro,
superintendent of AMA,
previously told Caribbean
Business. “We educate our
students from the earliest
grades up to 12th grade,
committed to their intellectual,
social, emotional, physical
and spiritual aspects.”
To fulfill its mission, AMA
has integrated information
and communication technologies
in all classes, with
more than 30 classrooms at
the secondary level featuring
such resources as interactive
blackboards and
digital projectors, as well as
providing the Edline Program,
which allows students
and parents to access information
about classes and
school activities, and Wi-Fi
throughout the entire campus.
Furthermore, and in
tune with the 21st century’s
new demands and educational
trends, AMA adopted
the EduSystem digital content
platform, which offers
curricular content in all
basic subjects from grades
seven through 12.
“This platform complements
the traditional teaching
methods, transforming
the experience into a much
more interactive one, and addressing
the different ways of
learning that students have
today,” Alfaro said. Just as
technology responds to AMA
students’ academic needs,
she added, character development
is essential to the
school’s mission.
“The importance we put
on developing character in
our students is one of the
attractive features of our
school,” Alfaro said.
Meanwhile, in addition
to having a comprehensive
physical education program,
sports are essential components
at AMA. The Bisons
are represented in more
than 50 highly competitive
teams that participate in 11
various sports from fourth
to 12th grade.

Thursday, February 8, 2018
SPECIAL ADVERTISING FEATURE
45
Bermúdez, Longo, Díaz-Massó
Spearheads Reconstruction
BY MARIO BELAVAL DÍAZ
There are nothing but
opportunities in Puerto
Rico, even after the
devastating impact of
Hurricane Maria, said Francisco
Díaz-Massó, president of Bermúdez,
Longo, Díaz-Massó LLC
(BLDM), a local and national
leader when it comes to specialized
construction services.
“With elements such as a fiscal
plan in place and the input of
federal aid, and the ongoing restoration
of electrical power, Puerto
Rico is poised to maintain its place
as an investment destination,”
Díaz-Massó said. “In terms of the
construction industry, we have
had the experience of working on
projects that are essential to help
ensure the island as an investment
destination, and in our case, with
specialized construction and development
service so local and international
investors achieve their
goals.”
And BLDM has been a part of
this recovery effort, providing services
to clients in both the public
and private sectors in areas such as
telecommunications and roadways.
For more than half a century,
BLDM has been involved in construction
work, providing a range of
services to both domestic and international
clients. The company has
earned its reputation for integrity
and professionalism across all major
sectors, with tailored services to
suit each project or client. As electrical
and mechanical contractors,
BLDM annually performs more
than $100 million of work on projects
of all sizes and degrees of
complexity.
As leaders in the field, the company’s
work is characterized by
the smooth flow of their projects,
resulting from their expert management
and capable supervisory
personnel, combined with welltrained
field crews. BLDM’s staff
is well-known in the industry for
the assistance rendered in the preliminary
stages of project design,
analysis and cost evaluations. The
company is engaged in a variety of
industrial and commercial projects,
from housing to retail developments,
and institutional buildings
to industrial facilities. BLDM
LLC also performs a considerable
number of infrastructure projects
while serving the local utilities and
telecommunications industries.
When the company was established
in 1962, the founding partners
had one goal in mind—to
provide competitive quality service.
More than 50 years later,
that commitment is the company’s
core mission. Since then, BLDM
has successfully strived to serve
clients, attending to safety, quality
and detail.
“Although time changes many
things, there are some basic principles
that never change, and for us,
customer satisfaction is still our reason
to exist,” Díaz-Massó said.
Moving forward into the
21st century, BLDM is ready to
face the challenge of a new era,
embracing new technology and
innovation but maintaining our
“customer-first commitment.”

46 SPECIAL ADVERTISING FEATURE Thursday, February 8, 2018
TASIS Dorado: Rebuilding Together for the Future
SPECIAL TO CARIBBEAN BUSINESS
From Jan. 9 to 12,
high-school students
from TASIS Dorado
participated in the
school’s annual Exploration
Week Program. TASIS students
eagerly look forward to
returning to school in January,
as this traditional and
important week brings expert
practitioners, who provide
meaningful, integrated academic
seminars and service
opportunities that give students
experiences that go far
beyond the classroom.
According to Susan Fiallo,
who develops and supervises
this program, this year’s Exploration
Week focused on
three areas related to building
a brighter future for Puerto
Rico after Hurricane Maria.
“We created projects where
students would have to work
hard and see that their work
could make an important difference
toward rebuilding our
island,” Fiallo said. All school
students, she added, learn to
serve and be active citizens
through the curriculum.
The first area was to provide
relief from the hurricane’s
effects. Students learned how
to re-energize themselves and
others through art and sports.
They shared the message
of love and hope for the
island through documenting
common experiences, creating
art and helping others through
sports and actively cleaning
and rebuilding.
Renowned artist Dama
Lola worked with students
to create a beautiful mixedmedia
mural. Nearby, Héctor
Collazo, of the “78 Pueblos,
1 Bandera” art initiative, collaborated
with students in
painting a large Puerto Rican
flag on a wall. Large groups
of students also cleaned
and held physical education
classes in a public elementary
school, and completed
cleanup and repair work on a
home, school and small business
in Los Naranjos in Vega
Baja, where TASIS Dorado
has been involved for more
than two years.
The second area of focus
was “Preparing Yourself
to Help Rebuild a Stronger
Puerto Rico.” Students could
choose to develop skills to
share and contribute to making
Puerto Rico stronger and
better prepared for the future.
Some students completed
technology certifications,
solved challenges in the Fab
Lab through inventions and
teamwork, and became certified
in rescue, cardiopulmonary
resuscitation (CPR) and
lifeguard skills.
The third area of focus is
vital to building a strong future
for our island. Students
learned how Puerto Rico
can improve energy and
food sustainability.
Students from Dorado’s
The American School in
Switzerland (TASIS) are facing
this challenge through reconstruction
of a new greenhouse.
The student Engineering
Club created the design,
and its team made parts using
3D printers, prepared materials
and sewed seams to build
the structure.
Another group of students
visited and worked at three
local farms, where poultry,
beef, dairy and pork products
are raised and processed locally,
learning firsthand how
our own community can contribute
to sustainable food
production.
Each student developed
new skills, insights and empathy
through these experiences.
However, the most important
lesson was that commitment
from each of us is essential
to rebuilding our island,
and that together we can make
the difference that will bring
us to a stronger future. According
to Head of School Tim
Howard, “Exploration Week is
a signature program of TASIS
Dorado. This year’s theme was
relevant and empowering for
our students.”
The admissions team invites
prospective families
to join them at their Open
House & Campus Tour, next
Friday, March 2.
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Thursday, February 8, 2018
SPECIAL ADVERTISING FEATURE
47
Carrerá Arquitectos Designs Outside the Box
BY MARIO BELAVAL DÍAZ
Having fully understood
and dominated the
box, Carrerá Arquitectos
PSC can truly think
outside the box, setting it apart
from other architectural firms in
Puerto Rico.
“We have acquired extensive experience
in multiple project typologies,
and we provide our clients with
creative design solutions,” said Edelberto
Carrerá, president of the firm
and member of American Institute
of Architects (AIA). “Our goal has
been to fully understand our clients’
needs and provide leadership
in bringing our clients’ visions to life
and provide value through design in
the process, maximizing our clients’
investment and creating commercially
successful multi-use projects.”
The firm was originally established
in 1982 and incorporated in
2000 as Carrerá Arquitectos PSC.
Over the past 30 years, Carrerá
Arquitectos has designed and permitted
a wide range of project typologies,
specializing in multi-use
complexes, office and commercial
buildings, new mall and major mall
renovations, as well as extensive
design and interior branding projects
in retail, office, food service and
entertainment typologies. Carrerá
Arquitectos has also designed more
than 15 cinema projects, most for
stateside companies.
As an interdisciplinary group of
architects and interior designers
seeking excellence in design and
service for our clients, Carrerá Arquitectos
provides a vast variety of
services such as: architecture, interior
architecture, graphic design
and branding, conceptual schematics
and constructability evaluations,
sustainability, urban planning, land
and commercial development, predevelopment
and permitting, and
client support services.
Carrerá Arquitectos works with
major local and U.S. corporations,
investment companies, as well as
local developers. Some of the firm’s
current stateside clients include Simon
Property Group, CPG, DDR,
Walgreens, Scientific Games, Dave &
Buster’s, as well as several international
banks. The firm’s largest project
is the T-Mobile Center Complex
in Guaynabo, a signature state-ofthe-art,
high-rise mixed-use development
featuring two office towers,
a retail shopping center, the University
of Phoenix urban campus, banking,
restaurants and a multi-level
parking deck within the complex.
The $45 million development comprises
more than 260,000-squarefeet
of leasable space.
“We provide value through design,
seeking to create timeless architecture,”
Carrerá said. The success
of the firm throughout the
years, he added, is due to its style of
design processes and its personalized
service to clients. “We design
our projects from the inside out.
Systematically working with our client,
we design buildings that are genetically
thorough and functionally
successful.”
Needless to say, Carrerá Arquitectos’
performance record with U.S.
stateside companies makes the firm
the go-to partner for investors in
Puerto Rico who seek excellence in
architectural services. Carrerá added
that the firm’s current stateside
clients are repeat customers.
Considering the vacuum in development
in Puerto Rico for the past
10 years, new large-scale projects,
designed by local architects who truly
understand the culture, will become
iconic landmarks and will receive incredible
reception and demand.
For more information, go to www.
carrera-arq.com.

48
SPECIAL ADVERTISING FEATURE Thursday, February 8, 2018
Custom Group:
The Perfect Solution
Prime Janitorial
Expands to Florida
SPECIAL TO CARIBBEAN BUSINESS
With more than
30 years of
experience
in the Puerto
Rico market, Custom
Group continues to position
itself as one of the best
allied companies for new
investors who arrive to
Puerto Rico seeking investment
opportunities in the
local real-estate market.
As an enterprise that has
an understanding of the local
market, with a comprehensive
knowledge of the
current economic drivers,
key stakeholders and political
environment, Custom
Group can assist clients by
creating strategic alliances
to ensure the success of all
their new ventures.
“We strongly believe Custom
Group is the strategic
solution that will provide
the necessary local leverage,
resources and knowledge
to guarantee successful investment
opportunities in
Puerto Rico by providing
the right guidance, from
the initial procurement
and planning processes until
project closeout,” said
Ramón de León, Custom
Group president.
Custom Group employs
a team of the most highly
qualified certified professionals
in various fields of
engineering and project
management, with vast expertise
in real-estate development
and construction.
The company strives to
implement best practices in
the industry through a highly
structured system that allows
its clients to detect and
mitigate industry-related
risks from a very early stage
and maximize the return on
their investments.
“At Custom Group, we
welcome new investors to
Puerto Rico with vision,
dedication and innovation,
as we strongly believe there
are many great opportunities
on the island that will
have a positive impact on
its economic development,”
de León said. “We also
want our clients to become
bigger and stronger, while
ensuring their success
and the reliability of our
services.”
Custom Group is a fullservice
engineering and
real-estate development
firm that provides project
management and general
contracting services to the
residential, commercial
and industrial sectors in
Puerto Rico and Florida.
Its comprehensive valueadded
services create an
environment that minimizes
risk, while maximizing
returns for customers by
allowing their projects to
be delivered on time, within
budget and with quality.
BY MARIO BELAVAL DÍAZ
These are tough economic
times, but
for a business such
as Prime Janitorial,
growth and expansion
are the keys to face these
challenges and thrive. The
company, founded in Ponce
by entrepreneur Fernando J.
Rodríguez, has grown over
20 years to become a local
leader in professional maintenance
and cleaning services,
expanding two years ago
to the Dominican Republic,
and most recently launching
operations in the U.S.
mainland in Orlando, Fla.,
under the name Primest Inc.
“We launched the Orlando
office some six months ago,
and aim to extend and provide
the same quality services
we offer in Puerto Rico,”
said Osvaldo Santana, director
of sales & new business
development for operations
in Puerto Rico, the Dominican
Republic and now Orlando.
“This is the result of
a thorough strategic plan we
developed where we looked
at places that were prime investment
destinations.”
Primest began by offering
services such as office maintenance
and plans to expand
to those areas of business
that it caters to in Puerto
Rico and where the company
has extensive experience and
knowledge, such as in the
manufacturing and healthcare
sectors. In fact, if that is
the aim, then the company’s
move to expand to Orlando
is right on target and that
city’s businesses have only
to benefit from a company
whose extensive experience
in Puerto Rico has placed
them among the leaders in
its field on the island.
For starters, Prime
Janitorial is certified ISO
9001:2008 for its quality
management system, sanitation
and disinfection of
hospital common areas as
well as operating rooms,
patient rooms, laboratories
and medical departments.
The International Organization
for Standardization
(ISO) is worldwide organization
that rates the quality
standards of an organization’s
processes. Santana
said Primest Inc. plans to
receive this certification in
Florida as well.
In Puerto Rico, Prime
Janitorial fulfills its mission
through the use of the leading
products in the market
and robust delivery methods
that ensure transparent,
auditable and safe cleaning
solutions. Its approach is
based on rigorous training
of its human resources,
implementation of strong
quality controls, the use of
advanced equipment and
first-class products, creating
smarter ways to work and
protecting client reputations.
In Santo Domingo, in the
Dominican Republic, where
the company has been present
for the past two years,
Prime Janitorial is in a dynamic
state of growth with
450 employees, and an everexpanding
roster of clients.
As Prime Janitorial does in
Puerto Rico and in the Dominican
Republic, its sister
company Primest Inc. in
Orlando offers top-notch
services to contractors, hospitals
and healthcare institutions,
the food service
industry, educational institutions,
manufacturing, the
commercial segment, warehouses,
hotels and banks,
among others. As the company
grows in Orlando and
its environs, there are plans
to serve other cities in Florida
such as Tampa.

Thursday, February 8, 2018
SPECIAL FEATURE 49
American School
Students Rebuild
Puerto Rico
BY MARIO BELAVAL DÍAZ
The American
School in Bayamón
may have
had lost its
800-person theater to the
winds of Hurricane Maria,
but that did not damper the
spirit of the preparatory
school. The high-school
students, who hold dance
competitions that usually
were held in the theater, decided
the show must go on
and held the dances in the
parking lot. Thankfully, the
rebuilding of the theater is
expected to be completed in
the coming weeks.
“I was deeply moved
by the spirit and commitment
of our students,” said
Dr. Doris Bello, founder &
headmaster at American
School, which has cemented
its reputation as an outstanding
prep school. “I’m
really impressed with the
way our students have faced
this reality and decided to
move forward.”
This is not surprising,
given the resilience fostered
by the demanding intellectual
and academic approach
the school expects
from its students, founded
in 1977, with the mission
of offering an educational
experience completely in
English, geared to both native
and near-native speakers
of the language, and
paired with the latest technological
and pedagogical
advancements.
“Our faculty is key in our
mission, and unlike other
private schools that have
lost teachers who have left
[because of the effect of the
storm on those schools], we
did not lose a single teacher,”
Dr. Bello said. “That reflects
our teachers’ commitment
and belief in what we are
doing at American School.”
Dr. Bello added that the
school welcomes students
from abroad, and the
American School has a
special program, which if
it needs, provides students
a transition process into
the school. Given that
American School students
come from a very wide
range of backgrounds and
abilities, each one of them
has something within that
is very special, Bello said.
“It is this focus on trying
to uncover that special
talent and using it to build
confidence and self-esteem
that makes American School
much more than a school,
but rather a family,” Bello
states in her message on
the school website www.
americanschoolpr.com.
American School’s approach
to education considers
memorization is not
enough and learning should
be a process that leads to
results, to the creation or
production of something, as
exemplified by the school’s
robotics program. The
school has an enrollment of
some 600 students.
“One thing we value is
learning by doing,” Dr. Bello
said. “Memory is good
to pass a test but it is not
enough, and knowledge
should lead to the creation
of something.”
Some 40 years ago, Dr.
Bello launched American
School with, among others,
a belief that students
should be prepared to face
the challenges of a world
in constant change, with
the academic, personal
and socials skills that allow
them to visualize and
achieve their goals. So, it
is not surprising that not
only are American Schools’
students featured on the
dean’s lists of the most renowned
colleges and universities
stateside, but have
also excelled as professionals
in areas such as top
executives in large companies
in the U.S., as well as
in the field of technology.
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50 SPECIAL ADVERTISING FEATURE Thursday, February 8, 2018
Colegio San Ignacio
Turns Values Into Action
Citi Community
Development Spurs
Housing Recovery
BY MARIO BELAVAL DÍAZ
Colegio San Ignacio
de Loyola
(CSI), the all-boy
Catholic school
founded and run by the Society
of Jesus, better known
as the Jesuits, and located
in San Juan, was ready for
the aftermath of hurricanes
Irma and Maria that hit the
island in September 2017.
This is because despite the
damage the school sustained,
the students, faculty,
parents and alumnus all
pulled together under the
message, “Men at the service
of others,” to keep the
school running, and even
help communities affected
by the storm throughout
Puerto Rico.
“The overflow of generosity
was very moving,” said
Flavio I. Bravo, S.J., president
of CSI. “Even our maintenance
team was impressed
with the response of the
school community.”
Thanks to the efforts of
the CSI community, the
school was able to clear debris
within two weeks after
the storm. While the school
was without electric power,
Bravo credited the creativity
of the teachers and patience
of the students for
allowing the school to continue
to function.
“For awhile, we went
back to just chalk and
blackboards, with some
classes being held in the
hallways,” Father Bravo
said. The school, he added,
was one of the first to open
after the hurricane, and
with some 121 days without
electric power, “we managed
to create a climate of
continuity in the student’s
academic experience.”
In fact, merely three days
after Hurricane Maria hit
the island, the CSI community
began clean-up work
for the school. On Oct. 2,
they had a meeting with the
faculty and administration
to discuss the situation at
hand. On Oct. 4, classes began
once again, and on Oct.
5, the school held a meeting
with parents to share the
action plan. On Oct. 20, students
began reaching out to
communities in need.
The hurricanes, especially
Hurricane Maria, were also
an opportunity for the Ignatian
community in Puerto
Rico to display the order’s
concept of accompaniment,
with calls on the individual
to approach reality in a way
that promotes solidarity and
motivates them to take action
to help those in need.
CSI students took this philosophy
beyond the walls
of the school by going out
and attending to the needs
of communities in Puerto
Rico that were hard hit by
the storm. These efforts included
students from seventh
to 12th grade, the Student
Council, Varsity and
other clubs, along with parents
and teachers offering
community services such
as helping prepare boxes
with essential articles at
the collection center at José
Miguel Agrelot Coliseum in
San Juan’s Hato Rey district.
The French Club provided
lunches for parents at the
Pediatric Oncology Department
of San Jorge Children’s
Hospital. Furthermore, following
the Ignatian maxim
that love is best expressed
in actions rather than words,
CSI established a program
through which, beginning
Oct. 20, students, by class,
would dedicate Fridays for
community service until
December 2017. Through
these efforts, the students
visited various communities
in towns throughout Puerto
Rico, providing water filtration
systems, food and articles
of first need.
“It not only allowed students
to see other people’s
reality and how the hurricane
had affected them, but
also to realize that through
their actions they could
make a difference in the
lives of others,” Father Bravo
said.
SPECIAL TO CARIBBEAN BUSINESS
Citi Community
Development and
four U.S. Department
of Housing
& Urban Development
(HUD) approved housingcounseling
organizations
announced an initiative
to provide urgently needed
housing assistance in
Puerto Rican communities
affected by Hurricane Maria.
The initiative will help
thousands of families across
the commonwealth recover
from the storm’s devastation
by securing housing
solutions and providing essential
housing services,
such as support for home
repairs, free housing counseling
and other vital recovery
resources to renters and
homeowners alike.
Supported by $500,000
in funding from Citi Community
Development, the
four participating housing
organizations—Puerto Rico
Neighborhood Housing Services
Corp., Ponce Neighborhood
Housing Services,
Pathstone and One Stop
Career Center of Puerto
Rico—will collaborate with
municipalities and community
leaders to target some
of the island’s hardest-hit
communities.
Residents are in need of
a broad spectrum of assistance
that will be addressed
through this initiative, including
financial assessments;
connections to local
resources; and consultations
on mortgage forbearances,
insurance claims and FEMA
applications. In addition,
this initiative will directly
support the reconstruction
of homes by making repairs
to doors, windows and roofs
damaged by the storm.
“I’d like to thank Citi
for teaming with four outstanding
Puerto Rican organizations
to help in this
ongoing time of crisis,” said
Ricardo Rosselló, Governor
of Puerto Rico. “Housing is
one of the most fundamental
and pressing needs, and
this support will help many
families receive the assistance
and funding required
to rebuild and get back on
their feet.”
“Months after the storms
have passed, thousands of
Puerto Ricans are facing
displacement and deep financial
instability, with few,
if any options to turn to for
assistance,” said Bob Annibale,
Global Director, Citi
Community Development &
Inclusive Finance. “By partnering
with trusted, locally
based housing organizations,
we are able to provide
access to vital counseling,
repairs and other housing
support services to assist
hundreds of Puerto Rican
families as they begin to
stabilize and rebuild their
homes and lives.”
“Thank you to Citi for
helping our fellow [U.S.]
American citizens in Puerto
Rico. Housing is the glue
that helps hold a family together,
and this effort will
provide desperately needed
resources to jumpstart
their road to recovery,” said
Rep. Nydia M. Velázquez
(D-N.Y.).
Hurricane Maria struck
Puerto Rico Sept. 20, 2017—
two weeks after Hurricane
Irma on Sept. 6—leaving behind
massive devastation to
vital infrastructure, property
and homes.
“During nearly 100 years
in Puerto Rico, Citi has
strived to support the development
and progress of
all of commonwealth communities,”
said Guillermo
Gómez, Citi’s Chief Officer
for Puerto Rico. “This new
investment will ensure residents,
especially those living
with lower incomes, get
the housing support they
urgently need, and is a further
demonstration of Citi’s
commitment to Puerto Rico
and its ongoing recovery and
renewal.

Thursday, February 8, 2018
SPECIAL FEATURE 51
Danosa Goes Beyond
P.R.’s Reconstruction
SPECIAL TO CARIBBEAN BUSINESS
Danosa, considers it is
their obligation to go beyond
the mere reconstruction
of Puerto Rico.
Hurricane Maria destroyed
the island’s physical
infrastructure, but its greatest
impact was on people’s
way of thinking, learning to
do things in new ways and
treasure the basic things in
life that we have taken for
granted like having water
and electricity in our homes.
We must help our people
reconstruct and select materials
considering that
Puerto Rico lies in an area
prone to hurricanes. Light
construction, lack of proper
maintenance and violation
of the island’s own building
codes are some of the
reasons for such damage
and must become our takeaways
from this sad and
difficult moment Puerto Ricans
have lived.
Regarding roofing systems,
Danosa has seen how
short cuts, the use of poor
quality material and workmanship
may some many
roof fail and increased the
damages upon the onslaught
of the hurricane, without
forgetting it was a category
5 hurricane. We have all
witness how many roofs had
their “imported best product”
hanging over the walls
like the sails of a boat.
This was a very sad image,
when one thinks about the
condition of the property inside
and the loss of the contents
if the roofing system
failed such an extent. Many
of these systems offered
tempting guarantees others
very economic costs or more
features than the product
could offer in reality. But
we have seen now the performance
in real time.
Many property owners
who confronted these
losses called us the next
day after the storm to help
them out. We have been
providing them robust systems
with redundancy, reliable
anchorage and adhesion.
Danosa was able to
begin manufacturing and
serving the market 4 days
after hurricane Maria hit
our Island, supporting immediately
the government,
Health institutions, the
business community and
household owners regain
the stability of their roofs.
We must pay attention to
details when purchasing a
roofing system and assuring
a good installation. A
great deal of attention must
be giving to details. We are
referring to the finishing of
the systems, on the edges or
perimeters, edges, corners,
walls of roofs. It’s common
to think that these areas are
mere finishing for more attractive
look, but it’s not
just that. These finishing,
on edges, corners, walls,
ect. are key components for
good performance. A professional
installation supported
by a robust roofing
system can prevent mayor
failures in case of a hurricane.
All these details will
have an effect on cost, but
we can now realize that cost
can be relative when you
analyze the consequences
and results.
The same theory applies
in many infrastructure areas
where we think about initial
costs and believe we are
making the best decisions
by saving a couple of dollars.
Let’s take this opportunity
to begin the process of putting
electric lines underground
or having alternative
energy solutions. We have
already seen the cost of not
doing so. How many billing
days has the Puerto Rico
Electric Power Authority
lost? How many businesses
have closed due to lack
of electric-power service?
How many will no re-open?
Let’s hope that with Maria,
we have learned about
the vulnerability of our
infrastructure, and that it
is better to make robust
designs and think about
the quality of what we are
choosing when one is in an
area prone to hurricanes
and other atmospheric
phenomena.
While it is a great source
of satisfaction being called
after the hurricane to replace
other materials and
solve other’s issues, we prefer
to help clients choose
the best system for their
projects before the hurricane.
With Danosa systems,
you are right on target.
Danosa systems installed
prior to the hurricane
passed the performance
test: a real category 5 hurricane.
It proved that Danosa
roofing systems withstood
to protect lives and property.
Let’s take advantage of
this experience to build a
more resilient Puerto Rico.
Let’s demand quality products
and excellence in labor
for our properties.

52 SPECIAL ADVERTISING FEATURE Thursday, February 8, 2018
From left: Jorge Guerrero, from Creative Developments; Sen. Miguel Laureano, representing the Humacao District; Adriel Longo, from Creative Developments; Gov. Ricardo Rosselló
Nevares; Ana. M. Sevillano, receiving the key to her new home; Rosachely Rivera, mayor of Gurabo; and Fernando Gil, Housing secretary.
Caminito Alto Apartments
Offers a Higher Living Experience
SPECIAL TO CARIBBEAN BUSINESS
Gov. Ricardo Rosselló,
along with
the secretary
of the Housing
Department, Fernando Gil
Enseñat, recently inaugurated
the first phase of the
Caminito Alto apartments
complex in Gurabo, in the
island’s southeastern region.
Caminito Alto, another
quality housing development
by the renowned Creative
Developments firm,
is a complex consisting of
apartments with two- and
three-rooms, with two
bathrooms in the dynamic
urban area between the
municipalities of Caguas
and Gurabo. The project
consists of two phases of
100 and 120 units, respectively,
with a wide array of
purchase options in available
in the delivery process.
Amenities include two
recreational areas, each
comprising a Club House
with fully equipped gyms,
swimming pool, a half
basketball court, play area
for kids, walking paths and
green areas. Special comfort
and security features
include potable water cistern,
parking spaces for
visitors, access control to
the complexes with a guard
post at the entrance, and a
security camera system.
The residential complex,
a totally private venture,
was qualified to receive
benefits from the Housing
Department through the
Law of Co-Participation
of the Private and Public
Sectors for the Operation
of New Housing. During
the opening ceremonies,
two families that benefited
from this incentive
received the keys for their
new homes at the complex.
This represents another
joint effort by private
companies and the government
of Puerto Rico to
stimulate and move forward
the island’s recuperation
process.
Creative Developments is
a deep-rooted construction
firm dedicated to housing
development in Puerto Rico.
Through its relentless pursuit
of innovation and steadfast
commitment to quality,
the firm’s main goal is to
provide housing units that
fulfill customer needs. With
a focus on innovative design,
high-end finishings, modern
conveniences and the
highest building standards,
the Creative Developments
team is constantly scrutinizing
every detail, from development
to final product, to
deliver unique projects of
the highest caliber.
As members of the
Puerto Rico Builders Association,
Creative Developments
is always in
the vanguard with the
new housing development
trends, earning some of
the most prestigious local
awards from organizations
such as the Builders and
Mortgage Bankers associations.
It is not a surprise
then, that Creative Developments’
clients enjoy the
satisfaction of acquiring
and investing in top-notch
properties.

Thursday, February 8, 2018 53
LIFE
Now Open:
The ‘Wonder’
of Loíza
This is a great opportunity to immerse into the
innermost parts of Loiceña culture
Parque Histórico Cueva
María de la Cruz in Loíza
BY JAIME TORRES TORRES
The turban and bomba
workshops are new experiences
with the arrival of
2018, which kids and adults
already enjoy at Parque Histórico
Cueva María de la Cruz in Loíza,
which celebrated its open house this
past week.
The folklorists Sheila Osorio, from
Ballet Folclórico Hermanos Ayala
and the group N’Zambi, and Marcos
Peñaloza, director of the musical
ensemble Tambores Calientes,
shared the knowledge and skills
they have accumulated in their
artistic careers with the Parque
Histórico visitors.
Since Tuesday, the workshops will
alternate between a section from
10 a.m. to noon and another from 1
p.m. to 3 p.m. for only $5. The ticket
includes access to the park’s caves
complex, which houses the oldest
beehive in the Caribbean. In fact,
the beekeeper, Dr. Juan Pérez, also
teaches about the importance of pollination
and the production of hone y.
“We invite [everyone] to see the
various activities we have for the
whole family. They are held between
Wednesday and Sunday, especially
for our girls, boys, parents and teachers.
The cave is rich in history; it accommodates
science activities, the
colorfulness of folklore and the happiness
that is characteristic of Loiceños,”
said Mayor Julia M. Nazario
Fuentes.
Considered the great wonder of Loíza,
the Parque Histórico María de la
Cruz is the first municipal enterprise
by the municipality. It is based on the
talent of the Loiceños and the anthropological,
archeological, ecological,
environmental and cultural richness
of this location.
“This is a great opportunity—both
for local and international tourism—
to immerse into the innermost parts
of Loiceña culture, to get to know the
gastronomy and enjoy its ecological
richness. We welcome [everyone]
with open arms,” said administrator
Daniel Alméstica, as he pointed out
that “La Cultura Loiceña en tiempos
de las Fiestas de Santiago Apóstol,”
which is a collection of plays from
don Castor Ayala, Daniel Lind, Samuel
Linda and other artists will be
shown in the park’s exhibit hall.
Furthermore, the historical park is
a place with a very special historical
importance. According to research
in 1948 by anthropologist Ricardo
Alegría, the archeological findings
of the archaic culture that precede
the pre-Columbian era suggest life
in Puerto Rico originated in this
cave, which was declared a historical
monument in 1972.
Besides its historic and ecological
appeal, the Parque Histórico Cueva
María is an environmental sanctuary
decked out with centennial ceibas,
other endemic trees and a pleasant
climate because of its proximity to the
mouth of Río Grande de Loíza as it
enters into the sea.
The bomba dance, apiculture, turban
workshops and Loíza artisans’ exhibition
will be available Wednesday to
Sunday when the municipality’s first
enterprise of the Capital of Tradition
is open.
WEEKEND
GUIDE
‘DE CUENTOS Y BELLEZA
IMPERIOSA’ (SYMPHONY)
Feel the intensity of pieces such as
Delano’s “Reyna Tembandumba” at
the P.R. Symphony Orchestra’s 10th
classical concert of the season.
Saturday, Feb. 10, 7 pm
Centro de Bellas Artes,
Santurce, San Juan
For more details, visit ticketpop.com
FESTIVAL DE VINO Y
GASTRONOMÍA
With a Carnival vibe, the Wine
& Gastronomy Festival will offer
delicious dishes and a great
selection of wines and spirits.
Saturday, Feb. 10, 7 pm
Museo de Arte de Ponce, Ponce
For more details, visit sal.pr
‘KISS, DON’T TELL’
VALENTINE’S PARTY
With the euphonious voice of
Carma Carmona to get people in
the Valentine’s Day mood, this is a
fun party for those with a romantic
partner and those who are on the
lookout.
Saturday, Feb. 10, 9 pm
La Concha Resort,
Condado, San Juan
For more information, visit the
event’s Facebook page.
‘LOS BORICUAS
ESTAMOS PASA’O’
(STAND UP)
Get a humorous perspective on
the complications of daily life from
these six comedians.
Friday, Feb. 9 & Saturday, Feb. 10,
8:30 pm; Sunday, Feb. 11, 5 pm
Centro de Bellas Artes,
Santurce, San Juan
For more information,
visit cba.pr.gov
MERCADO 23
You can check off your to-do list
for the Valentine’s Day gift for
your significant other while also
supporting local vendors.
Saturday, Feb. 10, 1 pm
Lote 23, Santurce, San Juan
For more information, visit the
event’s Facebook page
SANTURCE YOGI
Find a little inner balance in the
middle of the urban jungle with this
outdoor yoga class. The best part is
when the class is done, and you are
surrounded by great food options.
Sunday, Feb. 11, 9 am to 10 am
Lote 23, Santurce, San Juan
For more information, visit the
event’s Facebook page.

54 LIFE Thursday, February 8, 2018
Ad Calendar
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com website allows you to keep your
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2017 Caribbean Business
40 Under 40
Caribbean Business is looking for a few good
men and women. If you know young exemplary
leaders who:
• Are under age 40 as of Nov. 30, 2017
• Have held posts in upper or middle management
for at least two years
• Deliver innovative strategies and initiatives that
make a difference
• Possess a sterling track record of leadership
throughout their entire career
Submit you nominations now!
Check online for guidelines
and extended deadline
Caribbean Business
Power 100 2017 Edition
Discover which companies are spearheading
the island’s economic growth with innovative
strategies, products and services—all this and
much more in the Caribbean Business Power 100.
The 2017 Special Report brings together top
executives, companies and brands that have
transcended their industries to contribute to
Puerto Rico’s economic development, even as we
face most trying times.
Our special fully color, glossy magazine-type
anniversary edition filled with indispensable facts
and information on the forward-thinking people,
firms and brands that are helping to define our
future today.
The executives, companies and brands were
chosen on the basis of the following criteria:
· Innovation
· Industry leadership
· Contribution to Puerto Rico’s greater good—
whether through job creation, community
service or positive promotion of the island’s
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Look for these in March and April 2018!
Call 787-728-3000 today!
Rebuild or Reinvent
The Choices
Are Clear for
Ad Industry After
Hurricane Maria
BY JORGE BAUZÁ
Is industry fixing up its home after
the hurricane or packing their bags
to find a new place? After Hurricane
Maria, some people have decided
to fix their homes while others have
seen the investment of time and money it
will take, and decided to find a new place.
Whether it is the same place or
a radically different latitude,
when confronted with this
new reality some have chosen
to build upon existing pillars
while others have bet on creating
an entirely new environment.
Such is the situation
faced by industry.
The case for building on our
existing pillars is clear. The
industry has history. It has talented
professionals, who are
good at what they’ve always
done, and clients willing to pay
good money to keep the course.
They are supported by influential
CMOs who are satisfied
with the performance of their
agencies, the plans they have had in place
for ages, and have had good results year
after year.
In terms of numbers, some ad agencies
are better off building on their existing
profit pillars. These formulas have provided
them a steady income for years and
a new business plan would bring about a
new way to look at profits, which may be a
major hurdle for many. Some full-service
agencies need so much money to run their
full-service operation that they are sort of
trapped in their existing structures; they
have evolved themselves from a juicy rate
card to thin monthly fees supported by
volume discounts and commissions. In
essence, the agents we once were as an
industry in the 1950s are still well-represented
by these companies, and it seems
many have opted to stay the course.
The case for building something new
within the industry is clear and probably
in its best timing. The consumer has been
redefined, the brand landscape has been
replotted, and our new reality has brought
about new needs that may be answered
within the industry’s toolbox.
Enter consultancy. Although in the U.S.
consultancy firms are thriving, in the local
industry we have some companies that are
starting to offer such angles. This philosophy
is waiting for major brands to sign up
to this new approach to the industry. IBM,
Deloitte and PriceWaterhouseCoopers
have capitalized on their pre-existing tech
and management consulting structures
and now offer such services as marketing
services to maximizing digital media buys.
These companies are so well-positioned
Our industry is in the
best position to lead the
rebuilding and rebirth
of our island.
that they have even broken into Ad Age’s
top global agency ranking. But how about
building it the other way around? Consultancy
born from the industry equity on research,
product development, media, creative,
production, digital, social and many
other pillars that comprise our services.
Emma Williams from Marketing Tech
Jorge Bauzá
CONTRIBUTOR
writes, “Brand CMOs will increasingly
look to their agencies to share the best approaches
to media buying, data management
and measurement—seeking their
advice, for example, on how to best utilize
their tech stocks or in developing new
joint products.”
Since customer experiences have
evolved to the point of omni-channel and
omnipresent points of contact, so has the
need for companies that are able to understand
these new paradigms and help
brands to maximize their investments and
keep track of all the interactions that occur
in this ever-changing landscape. No
one knows the new market landscape after
Maria as well as the advertising/marketing
industry. Many brands were present
in the rebuilding phase
of the island, and some
agencies changed strategies,
showing the power of instant
creativity and ability to
adapt with positive results,
which is a major plus when
proposing that reinvention
of the industry.
Our industry is in the best
position to lead the rebuilding
and rebirth of our island.
Every element needed to
rise up can be found in the
multitalented roster found
in digital agencies, publishers,
media channels, promotion
firms, content developers,
etc…. We all only need to
sit at one huge roundtable and help each
other define where that path is and how
we can all walk on it without stepping on
each other’s toes.
The only mindset needed before deciding
if your business will rebuild or reinvent
is one brought up by Darwin, and it
serves as the perfect roadmap for this new
reality after Hurricane Maria. “In the long
history of humankind, those who learned
to collaborate and improvise most effectively
have prevailed.”
—Jorge Bauzá is partner & co-founder
of La Ferretería, which bills itself as “a
collaborative platform where agencies,
brands and startups will find talented
creatives from all disciplines, working
on discovering effective ways to connect
with consumers and create new communication
solutions.”