While the New York City real estate market may finally be slipping, the outlook is sunny and warm for New Yorkers buying homes on a Caribbean island in Turks and Caicos.

City residents have long owned homes in the Bahamas, but they have yet to flood the market of Turks and Caicos, a British archipelago of 12 islands with 30,000 permanent residents and some 200,000 visitors a year. Now, in a bid to increase the islands’ revenue, the British government is wooing foreign buyers with favorable taxes and new, high-end developments.

One of the newest projects is on the private island of Dellis Cay. Ground breaking is scheduled for April 1, and the first phase of building will be completed in late 2009. The development, which will span the entire island, will include one luxury hotel, the Mandarin Oriental, as well as high-end condominiums and standalone villas.

Already, several prominent New Yorkers have purchased properties at the resort, including the chief creative officer of Victoria’s Secret and chief marketing officer of Limited Brands, Edward Razek. He joins the acting power couple Catherine Zeta-Jones and Michael Douglas, who have purchased a fourth home there.

“New York is the biggest market in the U.S. for this island,” said Sebastian Steinau, the head of marketing and sales for the developer, O Property Collection.

New Yorkers traveling to the island can catch a direct three-hour flight to Turks and Caicos’s main island, Providenciales, and then take a 15-minute private boat ride to Dellis Cay.

The archipelago’s attractive tax policy has no capital gains tax on income and no restrictions on foreign ownership.

“Turks and Caicos is perceived as a friendly investment jurisdiction — we have a stable government, we are a British dependent territory where British common law applies, and the currency is in U.S. dollars,” a sales executive at Connolly Zahm Properties in Turks and Caicos, Nina Siegenthaler, said.

“Turks and Caicos is quite a small country that has been under the radar for quite some time, but the government’s investment into infrastructure has helped put the islands more on the map,” she added.

The chairman and chief executive officer of the O Property Collection, Cem Kinay, bought the 560-acre Dellis Cay two years ago and has collaborated with the architect Zaha Hadid on the development. Ms. Hadid, who had a show of her work at the Guggenheim Museum in 2006 and who designed the National Centre of Contemporary Arts in Rome, broke up the island into seven zones, each to be designed by a different architect.

Piero Lissoni, one of the architects, is designing the Mandarin Oriental Hotel and its residences, which start at $2 million. Mr. Razek and Ms. Zeta-Jones and Mr. Douglas have bought Lissoni ocean villas, which are estimated at between $7 million and $9 million.

Other properties currently for sale include 24 hotel residences, 54 beach house residences starting at $2 million, eight five-bedroom beach villas with accompanying pool houses, and nine six-bedroom ocean villas. Already, 40% of the buildings for the first phase of construction — hotel and beach house residences and the Lissoni villas — have been sold.

Five-bedroom villas on a Dellis Cay lake with a spa designed by the Tokyo-based architect Kengo Kuma will soon be offered to buyers, as will four-bedroom villas with an extension of the master bedroom over a water structure by the Tokyo- and Paris-based architect Shigeru Ban; one- and two-bedroom villas over the water on the south bay by the Singapore architect Carl Ettensperger; and four-bedroom villas on the north shore by the London-based architect David Chipperfield.

With the Bahamas already entrenched as a tourist destination, Turks and Caicos is staking its claim with lavish amenities.

“The direction the development is going now is very high-end and exclusive, since we’re late to the party, so to speak,” Ms. Siegenthaler said. “The government is trying to learn from the other developers’ mistakes.”

Just four years ago, roads on the islands were in terrible shape, she said, but now that the government is partnering with developers to enhance island infrastructure, tourism and business has begun to increase.

“Turks is not yet a mature market — we’re still in early stages of significant growth and we’re still an up-and-coming destination,” Ms. Siegenthaler said. She added that she expects buyers to spend a few weeks a year at their properties, renting them out for the remainder of the year.

Over the past four to five years, real estate on Turks and Caicos has appreciated by about 12% a year, and the best properties have done significantly better than that, experts said.

The best time to travel to the islands is between Thanksgiving and the end of April, but tourism also has been increasing during the summer months, with a heavy dose of European travelers in August. The average temperature is in the low 80s — warmer than Florida and the northern Bahamas.