Dec. 23--Six weeks ago, a team of developers, architects and financial titans broke ground on a $3 billion, 30,000-acre resort on the Dominican Republic's east coast designed to lure high flying travelers to the middle brow destination, a goal others have reached for with mixed success. 

"This is the moment for the Dominican Republic," said Ricardo Hazoury, president of the venture, Cap Cana, a hotel and condo destination set to grace 5 1/2 miles of the country's east coast. "We're trying to change people's ideas about the country. We're going for a high-class market." 

At nearly 47 square miles, the site that will be Cap Cana is the same size as Orlando's Disney World and 2 1/2 times the size of Cancun's hotel zone. 

"It's a Herculean task," said Chase Burritt, a hospitality analyst with Ernst & Young. "The Dominican Republic broadly is a very midmarket if not low end island. To switch it around is not impossible but certainly very ambitious." 

Teaming with all-inclusive vacation packages and some 54,000 mostly midlevel hotel rooms, the Dominican Republic has cultivated a market of middle-income vacationers who, more often than not, come from across the Atlantic. Just 29 percent of the 1.97 million who visited the Maine-sized country from January through October this year were from the United States. 

"The DR is not favored by Americans, because the product is aimed at appealing to a midmarket European leisure traveler," said Scott Berman, an analyst with PricewaterhouseCoopers. 

One exception is Casa del Campo, a popular, self-contained 7,000-acre, 370-room, three golf course resort that draws 70 percent of its market from the United States. Casa boasted luxury accommodations and high-end travelers at its outset, but its luster faded, Burritt said, as more of its facilities came online. 

But, analysts said, Capa Cana might have the right stuff to amp up the island's jet set quotient, thanks in no small part to some of its designer names. Jack Nicklaus signed on two months ago to create three golf courses and recently broke ground on the first. Ritz Carlton is in discussions to manage one of the dozen planned hotels, according to Hazoury, and other high-octane chains are courting. The project design includes a 1.2 mile-long marina that can hold up to 1,000 vessels that exceed 200 feet long. 

"There's nothing comparable I know of in terms of size and length of slip," said Kaye Pearce, president of the Fort Lauderdale International Boat Show, which, even this fall, saw swelling demand in the super-yacht market. "With its strategic location between the Bahamas and the Caribbean, there's absolutely a market." 

The destination is also near to an international airport with a daily American Airlines flight from Miami and sprawls along a spectacular coastline. 

"They're onto something," said Berman. "It would take a project of this size and scale to reposition the DR." 

It also takes deep pockets, something the Hazoury family appears to have. The family heads Grupo del Caribe, a Dominican conglomerate made up of construction, transportation and applied technology companies that credits itself with constructing 5,000 hotel rooms in the Caribbean in the past five years. The family also owns a private university and manages six of the nation's international airports. 

When Hazoury decided a year and a half ago to build a luxury destination, he approached French resort builder Pierre Schnebelen, who made his mark on the world's playground of resorts 30 years ago when, at the behest of France's then-president Charles de Gaulle, he helped convert the Alps from a climbing mountain into a world class ski destination. 

Other notches in Schnebelen's belt include the Sierra Nevada resort in Spain, Porto Paraty in Brazil and the Trent Jones Golf Resort near St. Tropez. 

"My challenge here," Schnebelen said of Cap Cana, "is to take a piece of dirt and transform it into something successful. But I've done that all my life." 

Schnebelen describes the architecture he selected for Cap Cana as "timeless, traditional and local," and aims to create what he calls "spontaneous animation." 

"It's when you have a critical mass of pedestrian streets, sidewalk cafes, boutiques, a marina, beach, agreeable walking paths, biking, sports, horseback riding, pleasant activities for the night," he said. "You can walk or drive for miles and miles and never run out of something to discover." 

When finished, likely within a decade, Cap Cana is scheduled to house 5,000 residents in hotel rooms, single family homes and villas. Baby boomers eyeing second homes are the target market, along with yachters and young, wealthy vacationers. Cap Cana's marketers, IMI holdings, are casting their nets in affluent markets in the U.S. Northeast as well as Europe. 

Developers say the project will create 50,000 jobs, sorely needed in a country that saw its tourist-driven economy convulse after Sept. 11. 

"The tourism industry has one of the highest multiplier effects, especially in developing countries," said Marie Dexter, a principal with Resort Development Consultants. 

One new room could generate up to five jobs, Dexter said. Cap Cana will also need shopkeepers, shuttle drivers, boat attendants and groundskeepers. "It definitely will have a big impact if it's developed as planned." 

The first phase of the project, some 60 oceanfront condos, is scheduled to come online late 2003, along with the first leg of the marina. 

Hazoury and Schnebelen are hoping to bag buyers with competitive pricing. Oceanfront condos for Cap Cana's first phase are being offered at $15 per square foot compared to $40 per square foot in Cabo San Lucas. 

Along with the challenges inherent in any project of this magnitude -- beyond Cancun, there is nothing comparable in the Caribbean region -- Cap Cana needs to soothe jitters U.S. buyers may have about owning in the islands. 

"U.S. buyers typically don't buy offshore. There's concern about risk," said Burritt. "You also have to get the customers down there. But (Cap Cana) has the right ingredients." 

As for the luxury market, analysts said in all likelihood it would rebound. 

"It's clearly a cyclical industry," said Berman. "Most people that operate in the luxury sector are very optimistic that we're certainly going to come out of it." 

"It would certainly change the face of the DR. That has some of the most spectacular beach frontage in the Caribbean. But Americans largely don't know about it." 

-----To see more of The Miami Herald, or to subscribe to the newspaper, go to http://www.herald.com

(c) 2001, The Miami Herald. Distributed by Knight Ridder/Tribune Business News. MAR, AMR,