Area developers look south Way south — Caribbean, Central America
Area developers look south
Way south — Caribbean, Central America
By Dick Hogan Originally posted on February 09, 2007
ALSO FROM NEWS-PRESS.COM
Southwest Florida builders have begun dipping their toes in the lucrative waters of the Caribbean and Central America.
Potential rewards are great, they say: Prices for land are low and potential buyers are lured by unspoiled beaches, government incentives to come there and a cost of living that's a fraction of that in the United States.And it's only a few hours by air for builders or buyers to reach most locations.
SPECIAL TO THE NEWS-
PRESSArtist's rendering of Pacifico, a 175-acre, mixed-use, master-planned community in Costa Rica But building or buying a home in a foreign country is not for the faint of heart.
Construction standards, environmental regulations and even the concept of land ownership can be different from what they are here.Some say it's worth it.
"I'm looking at it like the Bahamas were 30 or 40 years ago," said John Bredin, a graphic artist and painter who lives on a canal in St. James City.
He recently made a $10,000 deposit on a $157,500 bayfront homesite in Sunset Point, a project being developed in Panama by a group headed by Lee County businessman Ross Hagen.
The purchase is partly an investment, but Bredin intends to build and live there part time or at least use it for vacations.
In the back of his mind, he said, is the possibility of retirement."I won't be going down there full time in the foreseeable future, but in five years I have it in my mind that might be an excellent place to retire," Bredin said.
Leonardo Garcia, executive director of the Southwest Florida Hispanic Chamber of Commerce, said he's noticed an uptick in interest by local developers in the past several years in Latin American projects.
Mainly, he said, builders come to him for advice on how to handle differences in the development process.
"They're trying to look for connections that will help them remove any obstacles in the building process, to make the project a reality," Garcia said.
"When it takes longer to build, you're wasting money. You may run into situations that slow you down."
Generally, he said, governments south of the border are at least in theory favorable toward development although "sometimes you find employees who temporarily slow down the project.
"Typically, Garcia said, someone moving to a country in the region applies for status as a permanent resident.
"It's not hard to get," he said.The only country in Central America he's cautious about, he said, is Nicaragua, which is headed by anti-American Daniel Ortega.
Most familiar to U.S. builders is Costa Rica, where a lot of U.S. development has already occurred and the government has been working with Americans for years, Garcia said.
The Jack Parker Corp., a privately-owned real estate development company based in Fort Myers, last year announced plans for Pacifico, a 175-acre, mixed-use, master-planned community in Costa Rica."It's the Switzerland of Central America" with a stable government and 50,000 Americans living there, said Kerry Trowbridge, senior vice president of Jack Parker.
Sales started last month on the $80 million project, and the first multifamily building is scheduled to be completed in March, she said."This is our first international project," she said. "We did our homework."That involved research to determine who potential buyers might be, she said.
"Our market study, which was conducted by Ernst & Young, showed 70 to 75 percent Americans, followed by Canadians, Europeans and a very small number of Costa Ricans" with most sales likely to be second homes and investment residences, Trowbridge said.
"Since our demographic is American, we knew we wanted to create a community where buyers could feel comfortable with what they knew in America. They could go out and explore Costa Rica but come home and be comfortable."
That meant adding elements such as a 17,000-square-foot American-style grocery store similar to the Fresh Market chain, she said.
There's more than marketing to building in a foreign country, however.
"It's totally different," Trowbridge said. "Their designs are different; their building codes are different; their approval processes are different."
There also are quirks such as a law that bans foreigners from buying land on the coast. That means the community's beach club will have to be owned by a Costa Rican legal entity.
However, buyers will be able to get deeds to their residences as they would in the United States.
Dan Lubner, vice president of marketing for Robb & Stucky — a Fort Myers-based furniture store — is working with Jack Parker to provide furnishings for homes in Pacifico and will be opening a design studio there this year.
He's looking to expand his company's presence in the country, although Robb & Stucky's interest, at first, was strictly in the Pacifico job."I would say in the early stages we were somewhat myopic, not looking much further than the models," Lubner said.
Now, he sees Costa Rica as "an absolutely pristine and untapped market" with potential for additional projects.Hagen, who is developing Sunset Point in Panama, said he was drawn to that country because the Panama Canal means it always is likely to be a friendly, relatively affluent country.
Still, he said, differences are there even in the basic concept of property ownership."We did a lot of research and study," Hagen said. "We bought titled property, but the other thing there is called 'right of possession' where you're buying a right of some Indian's possession and it's really more of a 30-year lease.
You can't mortgage it. But there are plenty of foreigners buying it that way."So far, he has 45 buyers for 174 home sites and condominiums and is digging canals and putting in water and sewer lines in advance of a scheduled March closing on the first sales.
His biggest draw, Hagen said, is he can offer a place similar to what people remember as the way Florida used to be."I grew up here in Fort Myers, and I love it here. I love everything about the water," he said. "But it's changed."
The only downside, Hagen said, is one familiar to anyone who ever moved to Florida from the North."It rains a lot here," he said, "Ten feet a year. But like Florida, it cools everything off, and it doesn't come down cats and dogs. It just drizzles sometimes."
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