[Above, the rewards of philanthropic investing: the hotel’s restored library. Photos by Laszlo Karolyi.]
Impact Investing: How We Can Save Historic Buildings
The Cultura Manor hotel in Quito, Ecuador has won three awards before even opening, with more to come. I helped fund the restoration of this historic mansion, and now I’m getting bought out.
Exactly as planned.
Success in the art of Philanthropic Investing (PI) takes perseverance! Working in conjunction with the then Center for Sustainable Destinations at National Geographic, we coined the term (also known as “venture philanthropy”) in 2009 to form a group of philanthropists who believed in principles of quality travel development through investing, as distinguished from merely donating to local projects, which can be less effective.
Help for Developing-World Entrepreneurs
As I wrote when I introduced this project four years ago in my April 22, 2013 post, my dream for several decades had been to buy a small boutique hotel or ecolodge in a culturally unique region of the world and partner with an experienced local. This type of investing is not intended to enrich the investors, but rather to help qualified hospitality owners succeed in their quest to bring the world authentic and unique travel experiences that would meet many of the original National Geographic geotourism standards in culture, ecology, aesthetics, and authenticity.
A key PI element was an unusual written requirement: The operator has the right to exercise an option to buy out the investor as soon as the project has stabilized, and to do so at a very reduced rate of return. Then, according to the PI concept, the investor would use that principle and profit to invest in another qualified project.
Now, the seven-year Cultura Manor project has reached that stage. When we began, the mansion was occupied by squatters and in total disrepair. Demolition was very possible. Now the hotel has been awarded the #1 new tourist project in Quito. It was also honored for Historical Restoration and won a United Nations grant to provide organic produce for its restaurant on the roof of a new addition.
The main facility is open for business, and the operating partner is in the process of finalizing the government-backed loan to buy out us investors and construct the addition. We could not be more proud to be part of the opening of one of the most interesting and beautiful boutique hotels in the world.
A Model to Follow
I think it can serve as the model to launch a global movement to fund sustainable hospitality projects that follow established geotourism principles.
So now the question is how to we capitalize on this excellent base we have created?
We are looking for the next worthy project to lend our support. Whether you are a potential investor, an operator in need, or just someone who has a particular passion for sustainable tourism, we would like to hear from you about your vision.
You can contact us through firstname.lastname@example.org
[Editor’s note—UPDATE: Since this post, the Destination Stewardship Center is pleased to have provided the connection for a potential new philanthropic investment project, this time in Cuenca, Ecuador. Stay tuned.]