Although most of the 1,549 cuerdas of land — roughly 1,504 acres — where the Esencia project is proposed in Cabo Rojo would be affected by the construction of more than 1,000 residences, five hotels, golf courses and other luxury amenities, Roberto Ruiz Vargas, one of the project’s developers and its spokesperson in Puerto Rico, said that “luxury tourism is a form of development that minimizes the environmental footprint” during the Puerto Rico Real Estate Summit. The event listed Three Rules Capital, the project’s development firm, among its sponsors.
Esencia is the latest venture by the company, which builds luxury residential communities and hotels.
“We all understand that Puerto Rico is a small island with very sensitive natural resources,” Ruiz Vargas said, according to a supplement published in the local newspapers El Nuevo Día and Primera Hora and paid for by Three Rules Capital.
“In that context, luxury tourism is a way to pursue development while minimizing the environmental footprint,” he added.
The Centro de Periodismo Investigativo (CPI) reported last June that the five companies behind the development and operation of the Esencia project have left a trail of environmental damage in other countries while building luxury resort complexes, undercutting the developer’s claim.
As part of the review of the Environmental Impact Statement submitted to the Office of Permit Management, the Department of Natural and Environmental Resources (DRNA, in Spanish) and the Puerto Rico Tourism Company raised concerns about the project as proposed because of its potential environmental impact on the island’s southwest region.
In documents reviewed by the CPI, the Tourism Company underscored the value of the land slated for the project, citing the presence of beaches, wetlands and mangroves.
“The project includes a broad coastal strip of ecological resources, including the maritime-terrestrial zone, mangrove areas and wetlands associated with Caño Boquerón, native dry forest, and land classified for preservation,” Tourism Deputy Director Jorge Pérez González warned in a letter sent to the Office of Permit Management in March 2025.
“The project represents large-scale development, considering its size and number of units, with a high likelihood of affecting natural resources,” he added.
The Tourism Company recommended that the developers follow its Design Guidelines for Eco-touristic and Sustainable Tourism Facilities so the project would align with the area’s environmental, social and economic sustainability, as called for under Puerto Rico’s Public Policy Act for Sustainable Tourism Development.
Three Rules Capital rejected the recommendation, arguing that it did not apply because Esencia is not exclusively a tourism project and also includes a residential component. Even so, the project received nearly $498 million in incentives granted by the Tourism Company after being presented as a tourism development, as the CPI reported.
Photo by Abimael Medina | Centro de Periodismo Investigativo
“The project was designed according to principles of environmental, economic and social sustainability,” the developers said in response to the agencies’ concerns. “The project envisions that more than 75% of the land will remain as a non-impervious area, with ecological corridors, conservation zones, landscaped areas and golf courses designed to serve as water capture and infiltration zones.”
Three Rules Capital argued that only 25% of the land would be affected, defining that portion as the area subject to irreversible changes from the construction of roads, buildings or permanent earthmoving. The remaining 75%, it said, would form part of a large natural corridor designed by the developers to avoid altering wildlife and plant habitat and was therefore considered reversible.
“The rest of the land will be managed under a framework of conservation, revegetation, buffering or low-impact recreational use,” Three Rules Capital added.
The DRNA, however, had already flagged inconsistencies in the claim that only 25% of the land would be used for project-related construction.
According to the agency’s most recent assessment of Esencia, 68% of the nearly 1,550 cuerdas of land slated for the project would be affected in some way. Only 20% is expected to be preserved in its natural state, while the remaining 11% was classified as maritime-terrestrial public domain.
The DRNA also raised concerns about the natural corridor the developers propose to create, noting that it would require destroying the original corridors already in place.
The agency further warned that the design would perpetuate habitat fragmentation for endangered species, jeopardizing the long-term viability of their populations. “The Environmental Impact Statement does not analyze, using specific metrics, whether the project is truly sustainable,” the agency said of Esencia.
Although the DRNA requested changes to the Environmental Impact Statement because of what it described as the project’s “serious deficiencies,” given its scale and the irreversible damage it would cause to the surrounding environment, the Office of Permit Management approved it on Dec. 23.
The CPI did not receive a response from the project’s developers by the time this fact check was published, despite requesting comment through their press officer, Daniel Hernández.
Experts warn about luxury tourism
Last year, Three Rules Capital announced that it had received approval to pursue certification from Audubon International, an organization that specializes in certifying projects that align with sustainability standards.
Cristina Algaze Beato, an architect and green-building specialist, said that some organizations charged with certifying supposedly sustainable projects are often funded by the very industry they evaluate, meaning their metrics are shaped by what their clients dictate.
Journalistic investigations have revealed that Audubon International has certified golf courses where thousands of birds were intentionally killed.
“What is environmentally compatible is never developed on land that is especially ecologically valuable or sensitive,” Algaze Beato said.
Environmental engineer Ingrid Vila Biaggi issued a similar warning, saying the natural resources in the area slated for development are of incalculable value.
Vila Biaggi described the project’s purported sustainability metrics as “pure greenwashing” — a term used to describe efforts to mislead the public into believing that a company is doing more to protect the environment than it actually does.
“This is not a sustainable project because it is being imposed from the top down,” she warned. “Any structural changes made in Cabo Rojo are for the project, not for the community or the environment.”
Planner Ariam Torres Cordero said sustainability should not be used as a marketing tool for the project, but instead must be backed by clear metrics, monitoring and concrete obligations. Torres Mercado, who is also a professor, stressed that the project’s impacts would not be limited to the land itself.
“Luxury tourism is not, by definition, environmentally friendly,” he said. “In the case of the Esencia project, we are not talking about a small-scale or low-impact intervention, but rather a tourism, residential and commercial megaproject with intensive consumption of land, water, energy and infrastructure, as well as indirect impacts on sensitive ecosystems and our natural resources.”
The greater the land-use intervention and the larger the supporting infrastructure, the greater the project’s impacts and negative externalities, he explained.
Studies point to the risk
Universities in several countries have published research showing that the more luxurious a hotel is, the greater its demand for water.
A study by the University of Barcelona found that the higher a hotel’s star rating, the more restaurants, kitchens, amenities and water-dependent facilities it tends to have. That, in turn, drives up water consumption to keep the hotel operating. Another study, by Linnaeus University in Sweden, reached the same conclusion in hotels in Africa and Asia, specifically in Morocco and Hong Kong. The same pattern was documented in a study by Tunzi University in Turkey.
The same is true of carbon dioxide emissions, which accelerate global warming: internationally, studies have found that greater luxury is associated with higher emissions. That conclusion has also been echoed in research by Yunnan University and National Chung Hsing University in China.
A long history of environmental impact
Hotel chains Rosewood Hotels, Mandarin Oriental and Aman Resorts will build and manage 530 rooms as part of Esencia.
These luxury hotel brands specialize in high-end developments and operate complexes like Esencia in other parts of the world.
In the Bahamas, Rosewood Hotels is set to develop a $200 million resort on a private island spanning just 128 cuerdas (about 124.3 acres). The project will include 33 luxury rooms, a 20,000-square-foot activity center, multiple pools and two marinas capable of accommodating yachts up to 150 feet long.
Environmental activists in the Bahamas have warned that the construction will harm the small island’s marine ecosystem, as well as the seabed’s wetlands and marine vegetation.
In the Cayman Islands, Mandarin Oriental is building 42 residences, scheduled for completion by 2028, on one of the few sandy beaches on Grand Cayman, with pools and walkways woven among the trees. The homes will be priced between $8 million and $37 million. The Cayman Islands government did not require an environmental assessment for the project from Mandarin Oriental, even though the area is a critical habitat for sea turtles. The agency responsible for protecting the area’s natural resources warned that the resort complex would damage the beach. As part of the construction, the agency also projected the destruction of nearly 10 cuerdas (9.7 acres) of dry forest and scrubland.
In Mexico, Aman Resorts will open a hotel and residential complex this year stretching roughly 1,550 meters in Costa Palmas. William Bennett, one of Esencia’s three developers, contributed to the construction of another hotel in the community. After Costa Palmas was developed, access to drinking water worsened for residents of neighboring low-income communities.
The claim is false
Roberto Ruiz Vargas’s claim that luxury tourism minimizes environmental impacts is FALSE, as shown by the concerns raised by government agencies with expertise in the matter, the track record of these kinds of tourism megaprojects in other parts of the world, and the body of research on the subject.
