Cuba’s no investment grade bet yet: Fertitta
Denise Garcia | @denisejaeg 20 Hours Ago
Know the land you’re investing in
Tilman Fertitta, a billionaire restaurateur, has been relentless in
unearthing new businesses in the U.S. Yet unlike so many other private
U.S. businesses, he’s ruling out a move beyond the straits of Florida,
at least for now.
Fertitta is the sole owner of Fertitta Entertainment, the parent company
of Landry’s and the Golden Nugget Casinos. His latest venture involves
helping to reverse the fate of struggling startups in his new CNBC prime
time show, “The Billion Dollar Buyer.” In a recent interview, Fertitta
explained why his ambitions don’t involve Cuba, which a number of
multinational companies are eyeing in the wake of a shift in the
island’s relationship with the world’s largest economy.
Given the presence many U.S. brands had in the country prior to 1959,
Fertitta said he can appreciate the excitement surrounding Cuba’s future
prospects. Last month, Starwood Hotels & Resorts became the first U.S.
hotel company to sign a deal with Cuba since its revolution, announcing
a multimillion-dollar investment a day before U.S. President Barack
Obama made a widely publicized tour to the island. Starwood will manage
and market two properties in Havana and signed a letter of intent to
operate a third.
“It is so centrally located in the Gulf of Mexico that form the East
Coast, from Texas and from California, it’s so easy to get to,” Fertitta
told CNBC. “It was the playground back in the ’50s and the ’60s.”
As eager investors look to the Antillean island as a means to profit
from the evolving but still thorny relationship with the U.S., Fertitta
suggests that not everything that glitters is gold. He told CNBC there’s
still some time before Cuba becomes the latest investment grade Latin
Understand the political climate
The Texas mogul said the political nuances in Cuba remain murky, a
factor investors should gauge before investing abroad. Fertitta insists
that business owners understand the prospective terrain’s political nuances.
“I don’t even think we understand the political climate, still,” he
said. “It still might take the Castros being out and having to become a
democracy before it really happens, all together.”
Conversely, starting a business abroad is about being at the right place
at the right time.
“I think it’s going to take a few more years,” he noted. “Until they get
a few things worked out, I would definitely not go there — because you
don’t know what’s going to happen.”
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