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Costa Rica Investment
Costa Rica Investing and Property Development
Why Invest in Costa Rica?
What attracts investors from around the globe to this small Central American country? What induces international financial institutions, world leaders in technology and software development and manufacturing, the globe's most successful business leaders, and world-class luxury hotels to invest in Costa Rica?
Stable Political Climate
Costa Rica boasts an enviable history of political stability and democracy. Often referred to as the 'Switzerland of the Americas' for its peaceful political climate, Costa Rica has enjoyed an uninterrupted democracy for more than one hundred years. Costa Rica differentiates itself from other countries in the region by having no standing army. In fact, Costa Rica has the admirable distinction of being the only country to voluntarily dissolve its army. Taxes are instead channeled into its education and medical systems.
Moreover, Costa Rica is ranked among the highest in Political Stability Index in Latin America (World Bank, The Worldwide Governance Indicators 2010). The country has no limitations on capital funds transfers associated with an investment, regardless of the currency and there are no restrictions are imposed on re-investments or on repatriation of earnings, royalties or capita. There is no requirement to register investments with any of the government authorities and Costa Rica has achieved international standards for IPR protection.
Human Rights and Healthcare
The Costa Rican constitution of 1949 offers a wealth of rights and freedoms to citizens and foreigners alike including freedom of speech, press and assembly. Its citizen enjoy universal access to healthcare, and during the last 25 years poverty was reduced from 45% to less than 18%.
Foreign investors also benefit from Costa Rica's stand on human rights. Laws demonstrate a positive attitude to foreign investment whether large or small. Foreigners in the vast majority of cases enjoy the same rights as citizens when it comes to Costa Rica property ownership, and foreigners can own Costa Rica real estate in their own names or companies without the need for a local partner as is the case of countries such as Mexico.
Legal residents also enjoy access to the excellent social medical system, and investors and developers are beginning to take notice of the fast growing healthcare and medical tourism opportunities offered by a country with skilled doctors, world-renowned private clinics, and 3 internationally certified hospitals: CIMA, Clinica Biblica and Hospital Catolica. CIMA just opened a full facility at Liberia and Clinica Biblica also has a lab at the Pacific Coast.
Costa Rica's established social system also provides its citizens with universal access to education. As a result, literacy rates compare to those of Europe. The World Economic Forum's Global Competitiveness Report 2010-2011 ranks the Costa Rican educational system 22nd out of 139 economies and the first in Latin America. Children receive English classes in primary school and English is becoming increasingly prevalent throughout the country.
As a result, Costa Rica has a very talented and bilingual workforce. Currently, more than 200 multinational companies are operating in Costa Rica and on average 95% of the employees in multinational companies are locals.
Infrastructure and International Access
Costa Rica is easily accessible from all over the world through two international airports: (1) The Juan Santamaria Airport is located in the center of the country at the capital of San Jose and (2) The Daniel Oduber Liberia Airport situated just 20 minutes to 1 hour from the Pacific or “Gold Coast” beaches.
The Liberia Airport in Liberia began processing regularly scheduled overseas flights in December 2002. The increase in flights was so dramatic that the Liberia airport is now undergoing a huge expansion project which should be completed for the high season 2012. There are approximately 30 airlines that fly to Liberia.
The expansion consists of a two story terminal building of over 23,000 square meters, nearly 500 parking spaces, and 12 commercial spaces for shops, restaurants and kiosks. The new terminal is designed to process up to 1,500 passengers at peak hours, which equates to an increase of 100% of what could be handled in the past. More than 225,000 travelers arrived in Costa Rica last year via the Liberia airport, and we expect those numbers to increase dramatically in 2012. There are now more than 30 international airlines that fly to Liberia.
Moreover, infrastructure throughout the country is experiencing improvement. Although road conditions are generally not up to North American and European standards, the North Pacific Coast has experienced rapid growth in infrastructure to service the flood of investors. New bridges and improved roads make traveling more pleasant and convenient. While most smaller roads remain unpaved, thereby protecting the environment and maintaining the tranquil charm of country, the majority of primary arteries have undergone improvement to facilitate access from the Liberia Airport to popular locations such as Tamarindo, Brasilito, Flamingo, and Potrero.
Water supply, of concern in Costa Rica and around the globe, is being addressed as well. The Federal Government Water Department, AYA, is now taking a more proactive approach to water supply throughout the country.
Costa Rica continues to attract multinational business investment critical to continued growth and security for property owners. For example, Intel now employs nearly 4,000 workers who enjoy an average income double the national average. The company spends approximately $700,000 each year on education programs and contributes to various eco and humanitarian projects. Other multinational employers include HP, IBM, Emerson, Boston Scientific, Sykes, Vitec, Baxter, Hologic, Avventa and P&G.
In the financial sector, Scotia Bank, G.E. Capital, H.S.B.C. and Citibank have all recently purchased stakes in various Costa Rican banks. Globally recognized entrepreneurs are also nvesting in Costa Rica, such as Steve Case, the co-founder and former CEO and chairman of AOL, and Charles Brewer founder of MindSpring.
Costa Rica Hotels
Costa Rica's beautiful North Pacific continues to attract boutique and widely recognized international luxury hotel and resort projects. The huge success of the Four Seasons Hotel, which opened in 2003 on the Papagayo Peninsula, legitimized the area for other international brands. Focus of hotel investment continues to be on the Gold Coast of Costa Rica - a stretch of spectacular coast that begins at Hacienda Pinilla, just south of Tamarindo, and runs thirty-eight miles to the Peninsula Papagayo. Recent years have seen the opening of a Hilton Hotel in the Papagayo, RIU Hotel just north of Tamarindo, J.W. Marriott at Hacienda Pinilla, and Westin Hotel at Reserva Conchal.
We, at Re/Max Ocean Surf and Sun, work with only the most respected professionals in Costa Rica, and due to the improvement in infrastructure, our investors no longer have to travel to the capital city of San Jose in order to receive quality legal, architectural, escrow, and title services. Please ask us how to contact and arrange meetings with these and other specialists.
The Development Process
Options for developers and investors range from small parcels of land for construction of shops, offices, condominiums, and townhomes, to larger tracts for residential communities or commercial developments, to mega tracts for luxury resorts and hotels that include deluxe amenities such as golf courses, spas and equestrian centers.
Buying development property always has a fairly long due diligence period to allow for the developer’s professional team of property consultants, legal experts, engineers, architects and builders to review all aspects of title, infrastructure, zoning restrictions, construction and marketing. The Re/Max Ocean Group team is highly qualified to assist you with your endeavor as our team includes Certified Accountants, MBA's, Builders and other business experts who can assist with the process. We can also recommend exceptional lawyers, who would assume the leadership role as independent professionals involved during the due diligence process.
Costa Rica Real Estate
Commercial development in Costa Rica has matured over the last three years. Previously, with the exception of some large resorts, development was characterized by inexpensive land, less sophisticated construction such as basic condos and rustic cabinas, and underfinanced small developers. As the saying goes in Costa Rica, many were trying to make hot chocolate without enough cocoa. However, experienced developers from around the world have recently entered the market and are purchasing tracts of land priced from USD$2 - $40 million, depending on size, proximity to the beach, and quality of ocean views.
These developers recognize the importance of condominiums and townhomes to resort development in world-class destinations such as Hawaii, Florida, California, the Caribbean, Southern Europe and Mexico. Moreover, North America is experiencing a shift from the First home market to the Second home market as Baby Boomers seek retirement opportunities where they can live a high quality, healthy lifestyle. Though some buyers will always prefer a private, detached home, the vast majority of Second home buyers prefer condos because of ease of ownership and opportunity for rental income.
Re/Max Ocean Surf and Sun specializes in deluxe and luxury condominiums and townhomes and has an excellent inventory of high-end product. However, all our clients are important to us and receive the same level of service regardless of their budget or preference. Buyers need to be particularly selective in the budget market. Therefore, we have researched the builders, floor plans, location, payment and escrow structure of the area's budget market, and will only recommend and include in our database the best of these projects. If a condo or project comes to your attention that is not in our database, we will be happy to research it on your behalf, and as in other markets, if you decide to go ahead with the purchase, your Re/Max professional will represent you.
Re/Max Ocean Surf and Sun, recognizing the importance of the condominium market, has established a professional vacation rental and property management office. We are pleased to provide vacation rental services to our clients seeking real estate services in Costa Rica. Feel free to give us a call and we'll help you find just the right Costa Rica vacation rental in the perfect place so you get the most from your vacation and property hunting visit.
Costa Rican Multiple Listing Service
Contrary to what some may tell you, Costa Rica still has no official multiple listing service or MLS. Re/max Ocean Surf and Sun in Tamarindo is the flagship office of the expert real estate team The Ocean Group, and we have thus established our own internal service to link investors with the office, agent and property most suited to their needs. Our team of Costa Rica real estate professionals specialized in Costa Rica;s Gold Coast, and also works with a network of professional agents throughout the country. We will assist you with every step in locating, valuating and purchasing your ideal investment.
Detailed Investor Information
If you would like more detailed information about investing in Costa Rica real estate or development property, please contact us. We have together over thirty years business/real estate experience in Canada and Costa Rica. We would be more than happy to arrange a teleconference with you and/or your investors. We look forward to hearing from you.
Isabelle Emond & Courtney Borquet
Broker/Owner RE/MAX Ocean Surf and Sun, Tamarindo