In 2007, Guanacaste witnessed a boom in real estate and tourism, prompting Costa Rican developers DWL to invest in a mixed-use megaproject called Solarium. Located across from Daniel Oduber International Airport, the development was to include offices, warehouses, universities and other offerings.
Just two years later, an economic crisis stopped in its tracks the ambitious plan to build on land big enough to house 28 national stadiums.
From 2007-2009, the financial crisis that shocked the global economy froze investments in Guanacaste’s real estate sector, which for years had been driven by U.S. dollars. Faced with massive losses of international funding, the real estate sector entered a depression that wiped out numerous projects and suspended further construction in the region.
Today, the DWL project still retains more than half of its original property, about 511,000 square meters. And little by little, that megaproject is moving forward.
DWL spokeswoman Gabriela Mata said talks have restarted with companies interested in joining the planned free zone next year.
“We’re seeing opportunities to develop a cluster of light manufacturing, aviation and food production industries,” Mata said.
DWL’s experience is part of a general trend in the market of buying and selling land and buildings in Guanacaste. Analysts consulted by The Voice of Guanacaste believe that new highways and plans to develop a new cargo terminal at the airport will help add to market revitalization in the region.
The proof is in the numbers: Several real estate companies have increased sales by more than 15 percent in the past year, as well as resuming work on pending projects and new phases of hotel development.
Numbers Don’t Lie
The latest biannual study of Guanacaste by real estate analysis firm Newmark Grubb highlighted sales growth ranging from 14-40 percent during the first six months of 2016 compared to the same period last year for real estate companies surveyed. Pedro Sánchez, a Newmark Grubb market analyst, said the first half of 2016 has been the best period in the past five years.
VIP Costa Rica Real Estate Services, which operates in the province, has seen in the last three years 12-15 percent growth in land and condominium sales in places like Flamingo and Potrero.
The market’s awakening has even helped revive certain projects, such as La Meridiana, a second-home project located between the communities of Huacas and Tamarindo. Investment in the 23,000-square-meter La Meridiana is $13 million (¢7.3 billion at a dollar rate of ¢559), with 94 homes planned.
Work had advanced by roughly 60 percent in the first phase until it was paralyzed in 2009 as the global recession absorbed resources earmarked for a second phase, prompting Citibank to take it over. According to VIP, a group of Israeli investors acquired it and have since sold at least 25 percent of the planned units. Another 25 percent is actively being marketed.
Another niche with strong movement in Guanacaste is the hotel sector. According to Newmark, the RIU chain has started building a third hotel in the canton of Carrillo, and in places like Papagayo, new developments continue springing up.
For example, the Rosewood Hotels & Resorts chain announced at the beginning of the year franchise expansion that includes a 130-room luxury hotel in Bahía Culebra de Papagayo, with a $100 million (¢56 billion) investment fund from securities group Aldesa.
Reserva Conchal and Hacienda Pinilla in Santa Cruz, Eco Desarrollo Papagayo and Secrets Papagayo in Liberia, Azul Paraíso and Las Catalinas in Santa Cruz and Dreams Las Mareas in La Cruz, among others, also have joined the list by developing new phases.
Government Investment Shows Returns
Recent construction on the Cañas-Liberia stretch of highway and the eventual expansion of a cargo terminal at Daniel Oduber International Airport will create even more opportunities in the real estate market.
Airport terminal concessionaire Coriport announced last March construction of a second cargo terminal to help boost both exports and imports and attract new businesses and industries. Inauguration of the new facilities is expected by year’s end.
Randall Fernández, general manager of real estate analysis firm Colliers International, said this type of infrastructure expansion helps create new opportunities in Guanacaste – primarily in Liberia – in the industrial market, while attracting multinational manufacturing companies to the free zone. But work at a regional level remains to be done in order to be successful.
Experts say the advancement of Guanacaste’s market would be more tangible if local governments would work more quickly to provide infrastructure and services across the region. Repairing and finishing roads is one part of that equation.
Recent investigations by The Voice of Guanacaste also show that companies seek bilingual employees with at least a high school education, something that remains a challenge here.
Another incessant critical issue is water availability, a glaring concern in light of new megaprojects. While communities fight to protect water sources already available, the market seeks new sources and alternatives.
Despite challenges that remain, the general mood in the province’s real estate sector is positive. And it appears that the tumultuous economic crisis has begun to subside, at least for Guanacaste’s market – which not only might recover, but just might flourish.