Trouble in Paradise: Stakeholder Conflict in the Paseo Caribe Project

Trouble in Paradise The government of the Commonwealth of Puerto Rico, a territory of the United States, acquired from the U. S federal government a piece of land at the entrance of the San Juan Islet. This land was located in the Golden Triangle of San Juan, the island s capital, the Condado, and the Old San Juan. The government of Puerto Rico developed a Special Land Use Plan and regulation for the entrance of the San Juan Islet in 1993. The Plan also known as Regulation 23, coincided with Commonwealth of Puerto Rico s economic development plans and could not be altered unless an amendment was made. In 1999, the government sold the land to Hilton International in order to develop the land.. Further the opposition to the project also came from the local residents in the area. Who opposed the change of the zoning from residential to tourist area and further to the proximity to the project; they were also opposed to the increase in residential and the visitor density. Later it was found that there were many irregularities in the approval process that was undertaken to approve the projects as there were many laws that were not taken care of. Further there were also certain studies conducted by various government organizations whose results were not consulted before the passing of the project. Later a investigation was proposed for the whole approval process of the paseocribe. The issue turned in to a conflict and many violent protests were planned. There were series of protest organized by various organizations and people. Later the government intervened and stopped the project from going ahead. This also lead to protest from the industries sector as the industrialist in the real state sector said that issues like this would deter the foreign investors to invest in the country in the real estate sector. Later the company took the government to the court against its decision to hold up the development of the property. The company won the battle and was allowed to complete the project. Further the project was successful despite various protests from general public and various organizations. The case tells us about the irregularities in the approval process and its effect to whole projects as well as the common people of Puerto Rico. In 2000, Hilton International sold the land to a private developer named Arturo Madero, a developer with a long time experience in the real estate development sector in Puerto Rico. This project was called the Paseo Caribe and was organized as a public private partnership (PPP). The project developers had to contend with large demonstrations, civil disobedience, government intervention, legal proceedings and costly delays as a result of allegations that there had been multiple irregularities in the permitgranting processes and that the project had been built on public domain lands. The fact that Paseo Caribe was located in San Juan's prime tourist and convention area, as well as in a historically and culturally important zone, added significance and visibility to the debates. The key issue was whether the lands used to develop the Paseo Caribe project were in the public domain, and that the stakeholders on both the sides had a conflict during the development of the Project. The other issues are as follows: The Planning Board s approval of the Paseo Caribe Land Use Consultation had the net effect of redefining the parameters for land use, rezoning all the surrounding land and thus overriding Regulation 23. This resulted in violating the law and internal regulations of the agency itself. The Planning Board had authorized the Paseo Caribe Land Use Consultation while a number of required studies and permits were still pending such as the ICP, Transportation and Public Works Agency, the local Municipality, DRNA, etc. ICP approved the project despite concerns that there would be a threat to the preservation of the San Jeronimo Fort and to surrounding beach areas with the development of Paseo Caribe. The residents association of San Luis Condominium were strongly opposed to the change in zoning and to the proximity of the project to their building. There were apprehensions about the accuracy of the original appraisal by the First Bank as the bank had modified the mortgage several times. Several NGO s protested because of the illegal rezoning of the maritime-land that the project had caused. Despite, the San Juan County Development Commission suggesting a number of recommendations, the regulatory agencies ignored those suggestions. The future of the investment sector was in deep trouble as there were less private investments, and thus increasing unemployment. The initial investigation by the Planning commission should be more transparent and discrete and take into account all the permits from the various departments before giving the green signal for any project. The rezoning of the land should be accounted for as it is dangerous to construct any infrastructure on the coastline. The local people s concern should be taken into account as they would be the one s paying the consequence for any controversies in the project. Measures should be adopted to gain back confidence in the Justice System as well as any government agency granting any kind of permits.