Costa Rica Versus Panama
Earlier this week, Lief and I traveled from Panama City to Liberia, Costa Rica. The direct flight is now offered twice weekly.
I was first in this part of Costa Rica in 1987. The Liberia airport didn’t exist then; it was a landing strip.
Not much else existed in this part of this country at that time either. I was here for one of the first property research expeditions of my career, scouting Costa Rica’s northern coast just as the first non-Costa Rican developers ever were beginning to carve it up into lots and pepper it with condo buildings.
I’ve been back maybe two-dozen times over the near three decades that have passed since that first trip. I like to return every year or two to see how this one-time path-of-progress play continues to play out.
The 2008 “Crisis” is still referenced in everyday conversation among those in the real estate industry here. The troubles of 2008 and their aftermath collapsed this coast. Driving along it today you see the skeletons of developments that never were and that now some bank is trying to offload from its books.
“These abandoned projects were casualties of the Crisis,” our new local friend, Alonso, told us yesterday, “but they are also casualties of the global war on money laundering. Some were started by developers who lost their funding post-2008; others, though, were undertaken by drug dealers looking for places to clean their cash. The result is that, sometimes when you speak with a bank about one of these properties, you find that the bank isn’t quite sure who owns it.”
We’re not in the market to buy a foreclosed beach condo development, though one part of our agenda for this long weekend on Costa Rica’s Guanacaste coast is associated. This afternoon we’re touring some formerly foreclosed condo units that a friend bought from the bank a year ago. Our friend has cleaned them up, spruced them up, and furnished them and is now looking to sell them. I’ll let you know what we think of their potential as rental units after our tour.
The second reason for our visit is more personal. We’re in the market for a builder. Our Los Islotes development on Panama’s Azuero coast is at a turning point. We’ve got our Founder’s Lodge and one owner’s home under construction, five more houses about to break ground, and plans for our first condo units.
To launch all of this, we need to establish a long-term relationship with a builder who gets us and our Los Islotes vision. Our architect and friend in Panama City, Ricardo, put us on to his builder friend in Guanacaste, Alonso.
Alonso has been our host this visit. We spent the day with him yesterday on site at the private oceanfront community he’s building on Costa Rica’s Pacific coast. Lief and I were delighted. It’s proof that Alonso can build what we’re now ready to build on Panama’s Pacific coast.
The view of the crashing surf is ever-present at Alonso’s Guanacaste development… as it is at Los Islotes.
At the heart of the project where Alonso’s been at work for the past five years is a small town built in traditional Spanish style with cobblestoned courtyards and shaded plazas, secret gardens, benches, and fountains… plus a restaurant, a beach bar, and small shops… just as we plan for Los Islotes.
Up and down the hillsides behind the ocean and the town are custom houses built to take advantage of the ocean views and to showcase the best of classic Mediterranean design. From above, the community is a sea of red clay-tiled roofs. Up close they are a testament to the skill of Alonso’s crews.
Gates are thick wood carved by hand; railings are iron and ornate. Windows have deep sills and shutters, and oversized wooden doors are adorned with heavy iron hardware. Inside, ceilings are high, moldings elaborate. There are pocket doors and caned ceilings, polished stone countertops and colorful tiles in bathrooms and laid out in patterns on the floors. White-stone terraces surround infinity pools that run over, it appears, into that beautiful ocean that’s always just beyond.
Los Islotes is being developed with careful attention to all those same kinds of details.
Indeed, the similarities between the community where Alonso is building on Costa Rica’s Guanacaste coast and Los Islotes are striking.
As is one important difference.
Lots at the community where Alonso is building on Costa Rica’s Guanacaste coast are priced from US$300,000 to US$575,000.
And some of them are so small as to bring the phrase “the size of a postage stamp” to mind. No kidding. One is 133 square meters. That’s 1/25th of an acre.
Lots at Los Islotes are priced from US$29,000 to US$195,000.
That US$29,000 lot is four times bigger than the cheapest lot in the Guanacaste community… and less than one-tenth the price.
Los Islotes’ US$195,000 lot is nearly a full acre in size… and still a bargain compared with prices on Costa Rica’s coast.
Development at Los Islotes is several years behind that of the community in Guanacaste that we toured yesterday. Prices more than reflect that.
Plus, Los Islotes is in Panama. Panama versus Costa Rica? It’s a no-brainer choice from a long-term investment perspective. My money is on Panama.
P.S. Alonso is on board. He’ll be on site at Los Islotes with his crews by the end of the month.
If you’d like more information on the Los Islotes community we’re developing, you can get in touch here.