What Happen in Guanacaste
The boardroom door had barely shut in our hermetically sealed building, when our CEO turned to me and said, “ Maybe it’s time for us to take a look around in Costa Rica”. His comment was a result of a second meeting in as many months with two different development company’s inquiring if we had interest in participating as equity partners with them in a development in Costa Rica. This was late 1991. Within three months I was on a plane heading south and the day after arriving in San Jose I was climbing into a much smaller somewhat “oldish” looking plane. The pilot arrived right on time, a half hour late. He was decked out in cowboy boots, jeans, studded shirt with a Bolero, cowboy hat and gold-rimmed Ray Bans. I was looking around for a toothpick or cigarillo to give him. The attitude came right along with the attire and he climbed into the right seat to help navigate. Most of the instruments worked. The engine sputtered to life and the adventure began.
The objective was to find and map any and all possible beachfront properties that would be suitable for large-scale development. We flew directly to the coast off Quepos and then headed north. After following the shoreline north to the border of Nicaragua, we turned back around and landed in Tamarindo, that is after we did a fly by to “shoo” the cows off the runway. The pilot of course was in his glory with the “shooing”. We landed safely and in my hand I had my short list of properties. They were all in Guanacaste.
The primary reasons for selecting beachfront properties in Guanacaste was due to the fact they had more positive matches to the standard criteria used for selecting potential properties for resort community development. The primary criteria being climate, water source, access, beach quality, beach safety (swimming), location relative to services and topography of the property.
Guanacaste province has the driest climate in all of Costa Rica, as well as the most sun hours. Considering that the target market would be predominantly North American, it was felt the Guanacaste province provided a climate that is more suitable to the vast majority of the target market than other areas of Costa Rica.
The next criteria in all reality is the most critical for community resort developers and one that needs careful consideration and study prior to the purchasing of a development property. Though Costa Rica has the second most rivers in the world per square mile, sources of and supply of potable water remain a problem. Typically, most developers will have to perform exhaustive studies to ensure the property itself has an adequate water source. If not, the developer will have to find a neighboring property that does and acquire the water rights to this property and pipe the water to their property. Unfortunately the government of Costa Rica, or local municipalities cannot be relied upon to provide standard services commonly supplied in developed countries.
Access is equally as critical for a developer. This is the one criteria that truly separates Guanacaste from the other areas in Costa Rica and the one that has made Guanacaste a much more popular location for developers. The Daniel Odebur International Airport, located near Liberia is the reason for this popularity. Experienced developers are well aware of the overall impact that the proximity to an international airport has on the success of their sales program and property values. The Conchal Resort and Golf Club, Hacienda Panilla, and the Four Seasons developments are all with in a one hour drive of the Daniel Odebur airport, as are the majority of other smaller developments that are presently being worked on, and numerous coastal hotels of various sizes. Convenient international and local access is key to the success of any community resort development.
One thing that some tourists to Costa Rica are disappointed with is the color of the beaches. There truly is not a white sand beach in Costa Rica. Most are beige in color, while some border on being black and others a light champagne. Tourists tend to forget about the color of the beach once they step out onto the sand and take in the spectacular view of the deep blue ocean waters meeting the stunningly beautiful green coastline. There are no multistory hotels or condo buildings impeding the view. The Costa Rican government and ICT (Institute of Costa Rica Tourism) developed laws and created construction codes to protect the coastline from such building practices, and have worked to protect the natural shoreline of the beaches for years to come.
Costa Rica is well known internationally for its many beach areas that provide excellent wave conditions for quality surfing. These beaches though ideal for surfing, are not the greatest for safe swimming. Guanacaste province has more beaches than any other province in Costa Rica and most of them are tranquil beaches that are perfectly safe for swimmers of all ages. Some are small and extremely private, while others are large and expansive.
The overall topography of the coastline from the southern Pacific zone of Costa Rica to the northern Pacific zone does not vary greatly. It typically is made up of short or long stretches of beach separated by steep cliffs of volcanic rock. A much smaller amount of the coastline is made up of mangroves that are protected by law from being developed. In selecting a specific property for development, the developer is concerned with the percentage of land that can be built on and the cost related to building on this land. If there is not enough flat or relatively flat land that can be built on at a reasonable price, then buying the property will not make financial sense for a developer, as they will not be able to sell lots, homes, or condos at competitive prices.
One of the first large scale resort developments to open in Guanacaste is the very successful Conchal Beach Resort and Golf Club. The property has over 300 hotel rooms, a Robert Trent Jones Jr. signature golf course, tennis, and golf course condominiums that range in price from $238,000 to $465,000. The property itself is over 2,000 acres and the master plan incorporates up to five hotel sites, another 27 holes of golf and multiple residential sites of luxury homes, condos and home sites with varying ocean, golf course and valley views.
A neighboring development to Conchal is the largest development in Guanacaste, the new 4,500-acre Hacienda Pinilla Resort Community. With over 20 miles of water lines, 8 miles of roads, a Mike Young golf course, and a small hotel, Hacienda Panilla has just begun to offer oceanfront condominiums, elegant homes, and home sites.
Prices range from $242,000 to $495,000 for the condos, $614,000 to $1,450,000 for homes and $75,000 to $500,000 for home sites. Future growth for Hacienda Pinilla will include hotel sites, tennis, equestrian facilities, golf courses and additional amenities for residents.
The Papagayo Resort Community project has yet to open but is receiving tremendous attention. The First Phase consists of a 232-room Four Seasons Resort Hotel now under construction and an Arnold Palmer signature golf course, both due to open in the late 2003 or the spring of 2004. Additional phases will include a second Arnold Palmer signature golf course, ocean front condominiums and homes. The projected budget for this project is over $300 million
Why Guanacaste? Why Now?
The reason the province of Guanacaste is experiencing such tremendous growth is a combination of the above-mentioned criteria and the factor that over 75 million North Americans will be retiring over the next 17 years. The major impact over the last two years has been the Daniel Oduber International Airport. After three different presidential inaugurations the airport is starting to have a significant influence on the real estate industry in Guanacaste. Canadian charter flights have been using the airport for the last six years. Two years ago, US charter companies such as Go Vacations, Vacation Express and Apple Vacations started using the airport. The result was a dramatic effect on the demand for coastal residential properties. Now, rumors have it that Delta will be the first commercial airline to begin offering service three times a week from Atlanta direct to Liberia. The impact this will have on the real estate industry in Guanacaste will be significant, as it has in other vacation destinations all over the world.The timing is right. The location is right. Its time to answer the door, opportunity is knocking. As a very wise and experienced developer once told me, “ Find the path of development and get in its way”.
