Puerto Rico’s strategic position in the Caribbean Sea made it the target of many European nations beginning in the late 1500s, until the 1898 Treaty of Paris ended the Spanish-American War and made the island a U.S. territory. Over the years, Puerto Rico’s various occupiers blended with indigenous inhabitants to create a pastiche of continental and tropical cultures, as evidenced by the isle’s people and its architecture.

“You can find an immense catalog of styles—from 16th century Spanish architecture with lots of European vernacular to modern international designs,” says Mario Dumont Gaztambide, a designer at Carlos E. Betancourt Llambías Arquitectos, in Santurce. “The mix of cultures and history is what Puerto Rico is all about.”

While hospitality projects move forward, other commercial development and home building have stalled. “Construction [has] been greatly affected by the economic climate,” says Nataniel Fúster Felix, principal of San Juan’s Fúster + Partners. “Many offices have seen their staff greatly reduced. I hope the island can reposition itself as a center for investment and design.”

That’s the plan, certainly. Hoping to leverage the strength of the pharmaceutical, life sciences, and medical-device manufacturing sectors, the territory’s government is beginning to push the island as a hub for research and development, too. “We’re focusing on innovation and turning ourselves into a knowledge-based economy,” says Javier Vázquez Morales, executive director of the Puerto Rico Industrial Development Co. Proof of that commitment is the 80-acre Science City under way on the University of Puerto Rico’s Río Piedras campus, in San Juan. The project includes lab and office space, housing, and a convention center and will be built out over the next two decades. Morales adds, “We want to attract R&D facilities and scientists to do more science and discovery.”

2009 population: 3.9 million; current unemployment: 16%.

In the first quarter of 2010, San Juan’s 8.7-million-s.f. office market had 9.3% vacancy; asking rates: $19.50/s.f.–$37.50/s.f.

Current median home sale price: $230,000.

• Strong manufacturing and professional services sector
• Highly skilled, bilingual workforce
• Caribbean location

• Government bureaucracy
• High unemployment
• Lagging economy

“As an optimist, I imagine things will pick up,” says José Javier Toro, principal of Toro Ferrer Arquitectos, in San Juan. “Periods of scarcity can sometimes encourage creativity.”