this is not in any shape or form a solicitation for investments or home sales but just a response to a couple of people who wanted to know more about my investments in Panama... I am sure others here have either looked and/or bought foreign real estate and I for one would like to hear their experiences.
I originally met with someone who was a mutual friend through 2 different friends from 2 different periods of my life... this was comforting in itself, knowing that I had knowledge of his history. He contacted me knowing my real estate investment status... This was also a period in my life I wanted to create a divergence in my investments since they were mostly equities, retail businesses and local real estate. After some conversation, I was convinced to visit Panama with him and spent 5 nights. We had a lot of fun at night and during the day it was intense with facts, figures, interviews and note taking.... a deposit was formed to buy 2.5 kilometers of beach front property for $6mil USD. (Just for reference: several hundred feet on the NJ shore can suck up 6mil pretty fast) The end result was I one of the first investors who participated with his group and I invested in this project long before there was even a prospectus. I invested in this person's character and in his drive to make the project succeed.
Before choosing Panama, I have been all over Europe, many Carribean islands, and Central America. In each country and vicinity, I had always inquired about real estate ownership. The problems were consistent throughout many of the countries- foreigners are not allowed to own land, or the taxes were prohibitive, or perhaps the process was terribly tedious, or just different laws and systems made it very uncomfortable to do business because the security of law systems. People are probably not aware of this, but in France, you can be held guilty until proven innocent and you can be held even for suspicion... Even in Panama, the deed-title system was non-existent just up until this year and this at first concerned me. It is for this reason that I absolutely, positively do not like Mexico for real estate ownership because you don't get to own the land unless you are in fact Mexican...
Since I do not trust governments in general- laws in USA are even passed on a dime's notice- and other gov'ts tend to call the shots as needed at anyone's expense, it was imperative that I went with as stable a country as possible. Panama's history is that of stability minus the Noriega years, but in general, the laws are upheld, the courts practice due process and the police are not corrupt. This starkly contrasts many of Panama's neighbors' police and law systems.
So a quick rundown of the existing project- several hundred hectares along the beach with approvals finally certified by the government this past month for several hundred homes and town homes. Next in the project is a development for a marina which will be built to accomodate yachts up to 150 ft. And this project just very recently sold a third of its equity for 15 mil USD of which the funds will be used to develop this marina without any need to raise or borrow funds. So to say we are making money with this project is a vast understatement.
Original projections were to sell moderately priced homes at about $150-200 per meter. Now they are conservatively projected for high end, 2000 sq ft homes, at $500 per meter. The Master Plan looks like something right out of a high end Florida yacht club.
Important factors that made Panama appealing to me:
1. taxes - American citizens are not taxed for any income. Many of the real estate taxes are abated. This will probably change within a generation, but fact remains it is easy to make a living.
2. economy - it is a vastly growing economy mostly due to young population and the canal expansion. Estimates to become the largest tax free zone in the world are rumored... (it's already 2nd largest behind Hong Kong)
3. infrastructure - Americans occupied a large part of panama city for many years after building the canal and had only recently left... plumbing, water systems, electricity, phones, cable, all very similar to American infrastructure. This was a major problem in many of the other societies I considered around the world. New developments still did not have running water after 1 year of completion in a couple of areas I visited elsewhere in the world.
4. roads - highways, bridges and even toll booths are taken for granted... some of the latest technology around the world in bridge construction can be found with the beautiful spans in Panama... Interestingly enough, the road system was in itself was the most discouraging part of Costa Rica. I couldn't drive for 10 minutes anywhere in the country without risking breaking off an axle in a crater or hitting a cow...
5. hospitals - most advanced in Central America. Life expectancy is very consistent with US.
6. schools - literacy rate is higher than in US and just about all of Latin America. Many Latin American leaders were educated in Panama and the university system is highly regarded
7. politics - stable government is scrutinzed by world powers due to importance of canal. Due to economic strength, Chavez was basically laughed out of Panama.
8. weather - Panama is located outside the hurricane belt and the weather is consistent year to year.... the rainy season ends in November every year.
9. banking - Unknown to many people, and even shocking to me when I saw a different bank high rise on every corner in Panama City, Panama has one of the largest banking systems in the world and has for a century. The banking secrecy laws has attracted a lot of wealthy people and companies to work and invest in Panama.
10. accessibility - nonstop flights from Newark, NJ daily get me there in 5 hours and a 1 stop flight from Phila gets me there by 1pm (but 7.5 hrs)
Hope this answers questions... after proofing it, I think I made myself the tourist/economic minister for Panama.... and to be perfectly honest, if it were not for the principal of this project, I would have never have considered Panama.
Currently, we are in pursuit of more property in a very remote area that will take a few years to cultivate.
let me know if you have questions-
Randall
I originally met with someone who was a mutual friend through 2 different friends from 2 different periods of my life... this was comforting in itself, knowing that I had knowledge of his history. He contacted me knowing my real estate investment status... This was also a period in my life I wanted to create a divergence in my investments since they were mostly equities, retail businesses and local real estate. After some conversation, I was convinced to visit Panama with him and spent 5 nights. We had a lot of fun at night and during the day it was intense with facts, figures, interviews and note taking.... a deposit was formed to buy 2.5 kilometers of beach front property for $6mil USD. (Just for reference: several hundred feet on the NJ shore can suck up 6mil pretty fast) The end result was I one of the first investors who participated with his group and I invested in this project long before there was even a prospectus. I invested in this person's character and in his drive to make the project succeed.
Before choosing Panama, I have been all over Europe, many Carribean islands, and Central America. In each country and vicinity, I had always inquired about real estate ownership. The problems were consistent throughout many of the countries- foreigners are not allowed to own land, or the taxes were prohibitive, or perhaps the process was terribly tedious, or just different laws and systems made it very uncomfortable to do business because the security of law systems. People are probably not aware of this, but in France, you can be held guilty until proven innocent and you can be held even for suspicion... Even in Panama, the deed-title system was non-existent just up until this year and this at first concerned me. It is for this reason that I absolutely, positively do not like Mexico for real estate ownership because you don't get to own the land unless you are in fact Mexican...
Since I do not trust governments in general- laws in USA are even passed on a dime's notice- and other gov'ts tend to call the shots as needed at anyone's expense, it was imperative that I went with as stable a country as possible. Panama's history is that of stability minus the Noriega years, but in general, the laws are upheld, the courts practice due process and the police are not corrupt. This starkly contrasts many of Panama's neighbors' police and law systems.
So a quick rundown of the existing project- several hundred hectares along the beach with approvals finally certified by the government this past month for several hundred homes and town homes. Next in the project is a development for a marina which will be built to accomodate yachts up to 150 ft. And this project just very recently sold a third of its equity for 15 mil USD of which the funds will be used to develop this marina without any need to raise or borrow funds. So to say we are making money with this project is a vast understatement.
Original projections were to sell moderately priced homes at about $150-200 per meter. Now they are conservatively projected for high end, 2000 sq ft homes, at $500 per meter. The Master Plan looks like something right out of a high end Florida yacht club.
Important factors that made Panama appealing to me:
1. taxes - American citizens are not taxed for any income. Many of the real estate taxes are abated. This will probably change within a generation, but fact remains it is easy to make a living.
2. economy - it is a vastly growing economy mostly due to young population and the canal expansion. Estimates to become the largest tax free zone in the world are rumored... (it's already 2nd largest behind Hong Kong)
3. infrastructure - Americans occupied a large part of panama city for many years after building the canal and had only recently left... plumbing, water systems, electricity, phones, cable, all very similar to American infrastructure. This was a major problem in many of the other societies I considered around the world. New developments still did not have running water after 1 year of completion in a couple of areas I visited elsewhere in the world.
4. roads - highways, bridges and even toll booths are taken for granted... some of the latest technology around the world in bridge construction can be found with the beautiful spans in Panama... Interestingly enough, the road system was in itself was the most discouraging part of Costa Rica. I couldn't drive for 10 minutes anywhere in the country without risking breaking off an axle in a crater or hitting a cow...
5. hospitals - most advanced in Central America. Life expectancy is very consistent with US.
6. schools - literacy rate is higher than in US and just about all of Latin America. Many Latin American leaders were educated in Panama and the university system is highly regarded
7. politics - stable government is scrutinzed by world powers due to importance of canal. Due to economic strength, Chavez was basically laughed out of Panama.
8. weather - Panama is located outside the hurricane belt and the weather is consistent year to year.... the rainy season ends in November every year.
9. banking - Unknown to many people, and even shocking to me when I saw a different bank high rise on every corner in Panama City, Panama has one of the largest banking systems in the world and has for a century. The banking secrecy laws has attracted a lot of wealthy people and companies to work and invest in Panama.
10. accessibility - nonstop flights from Newark, NJ daily get me there in 5 hours and a 1 stop flight from Phila gets me there by 1pm (but 7.5 hrs)
Hope this answers questions... after proofing it, I think I made myself the tourist/economic minister for Panama.... and to be perfectly honest, if it were not for the principal of this project, I would have never have considered Panama.
Currently, we are in pursuit of more property in a very remote area that will take a few years to cultivate.
let me know if you have questions-
Randall
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