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Six years ago, Frank Canale started Sundancer, one of the most-successful small-scale real-estate developments on the island of Roatan. Here’s how he did it:

For a number of years, I developed real estate in Arkansas & Colorado; retirement & golf communities mostly, but after my wife & I had children I knew I wanted to bring them up in a more relaxed, more family oriented place & my wife & I wanted to try home schooling. We also wanted to go somewhere warm & I was looking for a place where I could make a living with a small real estate project.

With these things in mind we began our search for a place to relocate. I wasn’t by any means ready to retire, so not only was I looking for a place where we could enjoy some peace & quiet, I was also looking for a place where there was an opportunity for me to do a real estate project. I just couldn’t afford to retire and I didn’t want to either. In 1994 we looked at Costa Rica. It’s a lovely place and looked like a good place to live, but I felt like I’d missed the investment opportunities. This was before Costa Rica’s recent depression, and properties back then were, I thought, still very expensive. Next we looked at St. John, the U.S. Virgin Islands. It was simply too developed and too expensive for the small investor like me. If I had big bucks, if I was looking to build and had the money for a huge hotel complex, St. John might have made sense, but the whole scale of it was beyond my reach.You have to realize that I was operating with very little cash, as far as real 
estate developments go and I was a one-man operation. I didn’t have other investors ready to bail me out if I got into trouble.

Why I chose Roatan
Then I went to Roatan in the Bay Islands of Honduras, and I knew right away that this was the place. The moment we arrived I had a really good feeling about it, and at the time, it had hardly been developed at all. And for what I wanted to do, Roatan was perfect. There were several other projects going up…but none of them were even close to what I wanted to do. There were plenty of people designing bigger, more expensive places. These people were selling high end homes, some costing as much as $200,000. I knew my project would be different. What I had in mind was something for the smaller investor.

On my second trip to Roatan I bought a lot with electricity and water supplies. This is where I wanted to test the building process on a small scale, before I started on the actual places I would sell. This was in December of 1994. I bought the land, started a local guy on the framing of a house, returned to the United States for a month or two, then went back to Roatan to do most of the electrical work and plumbing myself. This would ultimately be the place where my family would live. While I was back on Roatan in March of 1995, I found the property where I would ultimately build my little resort…called Sundancer.

My most important lesson
One of the most important lessons I learned in this project was this: Build your amenities first. For us, this meant the pool…the dock…and the landscaping. You do this because when people come to look at your place they buy into the whole package. If they can see the pool and other amenities in place they know 1) that they will definitely be there and 2) what the place will look like when finished.What I’ve realized is that people are as interested in what their surroundings will look like as they are with what their actual house will look like. The actual building they buy matters less than you think. And it makes sense if you think about it. When people are here, they’re outside: diving, sitting on the beach or by the pool, or hiking around the island. If they were interested in simply a luxurious place to stay, they’d go somewhere else in the first place, like the Cayman Islands. The amount of time they spend in their actual place is really very little.Another thing I realized is that the people who buy in this market are much more adventurous than they are ready for  retirement. The people who bought at Sundancer wanted an escape…a getaway…or a vacation spot. Very few people will actually buy a home in this type of setting and spend all year here. For one, there’s just not that much to do. After a month or so of solitude, most people who are used to having so many diversions are ready to go home at least for a while, before they return. 

Island moving
So I bought the property in March of 1995, got started on my family’s house, then went back to the States and waited for my kids to finish school. In May of that year, we moved the whole family—along with all of our stuff—to Roatan. We leased our home, packed up our belongings, and left Arkansas. One important note: We didn’t take any furniture, because we knew we could get everything on Roatan for less than it would cost to ship. And the quality of wood on Roatan is better than most of the things we already owned. The local mahogany is excellent. Everything else, including cars, three boats, books, kitchen supplies, and lots of personal belongings, went with us.In June of 1995 I got my first building permit. I brought many of my building tools with me, but I got all of my materials locally. As far as our design and planning, we never had anything formal. For example, we found an area that looked like a good place for the pool, stepped off 17 feet in one direction and 35 feet in the other, and had our guys dig a hole.

More than anything else, we followed the layout of the land, especially the trees. We tried to cut down as few as possible. And if we had a nice palm or cashew, we sometimes built a house right around it. We followed a basic model of a friend’s log cabin in Tennessee, but that’s it. The most important thing was that we tried to make the houses look like they belonged there. If they were out on their own, without the surrounding trees and vegetation, they wouldn’t be very attractive…but as part of the actual setting, they’re very nice. 

How to find help
On Roatan I found a contractor, a local, named Richard Bodden, who is the brother-in-law of a friend I’d made on an earlier trip. This is important. If you’re hiring help, find one guy you can deal with…then have him hire all of the subcontractors. Believe me, you don’t want to get involved with the Honduran labor laws. And you definitely don’t want to be directly responsible for all of these people. Richard has done a great job—we’ve now built 30 houses together.Richard is also one of the main builders at another project I’m helping with on Roatan…Luna Beach (more on that in a minute). In all at Sundancer, I built 30 two-bedroom units. It was a total of 18 buildings. Some were a single unit, most were duplexes, and one building had four units.My project is one of the few on Roatan that has sold out, I think, because I’ve taken the time to build really nice places…I made them affordable to the average person…and I tried very hard to preserve the surroundings. 

Also, I’d like to make it clear that I couldn’t have done any of this without my wife Holly’s help…and the help of Delmar George, who died of liver cancer in the first years of the project. I recommend you have a few close people, whom you can trust implicitly, to help you in any kind of undertaking such as this.

Our next project
I’m now helping to do the marketing for a project called Luna Beach. I’m not doing any of the hands on work, that’s being handled by Don Goins, another IL subscriber, who lives on the island full time. Don is a retired ear surgeon from Denver, CO. He was the second buyer at Sundancer and lived there until he started Luna Beach. He’s now one of the biggest land owners on the island…and I was happy to help him with his development. 
Don followed my advice and built the amenities first. In fact, the bar and restaurant have been open for quite awhile. For Sundancer, I was there in person, every step of the way. I’m always amazed at the guys who come to a place like Roatan, set down a bunch of money for a project, return to the United States, then come back surprised to see that nothing’s been done. If you want to get something done in an emerging market like this, you’ve got to be there yourself…at least in the beginning. Don will be at Luna Beach for all of its construction.Luna Beach is a little more upscale than Sundancer, but it’s in the same vein. These places are really beautiful. The exotic wood floors and tiles make the places very nice inside. 

With Sundancer, we started off selling the place as quarter shares, which meant you could buy any three months of the year. But since it was just my wife and me running the operation, we simply weren’t set up to do it. It was a logistical nightmare. Since people weren’t there for part of the year, we wound up paying their taxes for them…handling their insurance, and dozens of other things that come with property management. 

We quickly learned that selling the units outright was a whole lot cleaner. 
At Luna beach, Don will have a full staff of people…so he’ll be able to offer timeshares. I think it’s a great way to offer people their own getaway. Timeshares are a great service to offer if you’re building a development. This way, for less than $50,000, people can have their own private Caribbean escape for three months of the year—and avoid all the headaches that come with owning resort property. Or if they want to come back to the island for one month of the year, they can do it for only $14,400. I’d recommend that you try to offer a similar service if you’re building a development somewhere.

If you can offer someone a timeshare, they don’t have to worry about maintenance, security, or any of the other hassles you’d have to consider if you owned the place yourself. And with this kind of resort, people also get access to a pool, a private beach, a restaurant, trails, and boat docks. 

If you’re interested in starting a project on Roatan, or elsewhere, I may be able to help you. The best way to contact me is by E-mail: fcanale@aol.com. I’m back and forth very often, so I may not reply right away.If you want me to show you around Sundancer or Luna Beach in person, we can make some kind of an arrangement. We charge $800 for a one-week rental at Luna Beach. You can reach the rental-management group on Roatan at, tel. (504)445-0009, E-mail: intpsych@globalnet.hn.  Let them know I sent you.