Panama Investor Blog

2008 Panama condo report

This CB Richard Ellis 2008 Panama condo report gives us a total of 11,428 total A B & C class active units under construction with an average  absorption rate of 73%. This class of condo is ranging in average price from $1548 to $2180 per meter and are mostly targeted to the foreign market according to the report. 

I question how they were able to discover the absorption rate for sales as this information is not publicly available. Where would you find the data to support sales that have yet to close. You can't really trust the developers to tell you how sales are really going. In any case it is a good read and gave me a warm fuzzy feeling for just a little while.

Read the four page report in this PF file.

Download panama_city_residential_condominium_market.pdf

Special report: The real story behind Panama's tourism numbers

Lies, Damn Lies and Statistics

It has taken considerable time and effort to put this report together and its implications are undeniably profound. Our purpose is in no way designed to hurt the country. We want to shine light of truth on what is believed by most people, in and outside of Panama, to be the country's largest industry. We hope that this information will help the country's political and business leaders to more carefully consider the tourism master plan that is currently under development by the Ministry of tourism. For any plan to be successful you must start with correct assumptions. Sam Taliaferro

December 2008
Prima Panama special report
By Paul McBride, CEO
Prima Panama, S.A.

SUMMARY

The fact that the number of "visitors" coming to Panama has increased dramatically over the past 10 years is undeniable. Yet it's important to make a distinction between "visitors" and "tourists". 41% of the increase in visitors over this period can be attributed to the increase in cruise ship passengers. Less than 15% of the current visitors to Panama arriving by air or land spend any time at all outside of Panama City. Any tour operator or travel agent will tell you that most real tourists only spend a short time in the city. Panama's real attractions (and the attractions promoted by IPAT) are all the wonderful sights located throughout the country at the beaches, on the islands and in the mountains. However, the numbers show that only a small fraction of the visitors coming to Panama travel outside of the city.

THE GROWTH OF TOURISM IN PANAMA

The foundation for any sound business decision is the ability to collect and analyze accurate data.  Without reliable numbers, any decision that's made is a gamble, a simple crap shoot.

On paper, tourism is the fastest growing industry in Panama.  According to statistics provided by the Panama Tourism Bureau, IPAT (STATISTICS REPORT 1997-2006), in 2006 the tourism industry contributed $1.45 billion dollars to the nation's economy.  This amount represents 9.5% of Panama's total Gross Domestic Product (GDP), making it the largest single industry in the country.  By comparison, in 2006 the Panama Canal generated $1.08 billion dollars in income while the total economic impact of the Colon Free Zone was a paltry $696.2 million dollars.

IPAT's statistical analysis also showed that the number of international visitors arriving in Panama was equally impressive.  In 2006, a total of 1,215,083 people came to visit Panama.  This is an incredible accomplishment given that in the year 2000 visitor arrivals were just was about half that number (600,169).

What's driving these remarkable achievements?  According to IPAT, the answer can be found in their report: "We can say that incoming tourism to Panama has maintained a sustained growth due to efforts made to strengthen strategies to promote Panama internationally in US, Latin-American, European and Canadian markets, as well as efforts to consolidate the cruise ship industry." In other words, the growth in the tourism industry is a direct result of IPAT's marketing strategy.

But, what exactly is that strategy.  Well, by judging past marketing efforts including the recent "The Path Less Traveled" campaign, IPAT has been positioning Panama as a wonderland of sun, tropical beaches, remote islands,  unspoiled rainforests and cosmopolitan city life.    With such a successful marketing campaign and with well over 1 million visitors traveling to Panama, the beaches, islands, mountains and rainforests must be teeming with tourists with hotels bursting at the seams, tour operators running at full capacity and domestic flights packed with vacationers.  All these areas must be singing songs of praise for the fabulous job done by the nation's tourism authority.

Foreign Residents in Panama- A Survey of Motivations, Attitudes and Preferences

Early this Fall, Prima Panama conducted a survey of foreign residents in Panama to determine their motivations for relocating to Panama, their attitudes about living here and their preferences regarding the lifestyle choices they made once they arrived.

The data we collected offers valuable insights into the reason why foreign residents chose Panama, where they live, what they like and dislike and their general feelings about life in the country.

A total of 264 foreign residents responded over the Internet to our survey questionnaire.  Although not a scientific study, we believe the results represent a fairly accurate picture of the foreign community in Panama.  The survey was conducted in August and September, 2006.

Click here for the report  http://www.panamarealestateinvestors.com/surveyres/

When you log in for the first time, you have to give your name, email address and country of origin.  Once you log in the first time, you go directly to the page.

Over 100 new businesses in Boquete!

My stepson Remington and I were driving up from David, talking about the events of the day. We had just left a meeting with a lady psychologist, who was doing an interview to determine if my motivation to adopt my two stepsons was honorable. It was an emotional time as we were interviewed together and separately.  The boys told her how happy they were to have me as their father for the last 9 years and I told her how my life has benefited from the time we have spent together. She told the boys how lucky they are to have a father and mother as she spends 99% of her time counseling unhappy families who have only one parent. Usually it is a young mother trying to raise several children on her own. She said it was so refreshing to see another side of life, which is all too infrequent. We have been working for several years on the adoption process, which involves many meetings and examinations.

Miami high rise construction report

My friend Tom Brymer sent me this link to a City of Miami report  about Miami condo towers under construction and completed as of October. It is interesting to note that there were 199 towers under construction or completed and 284 more proposed for the future. I wonder how many of those proposed will see the light of day with the precipitous drop in condo buying in South Florida. 19 buildings have already been withdrawn. Will Panama Real Estate have a similar fate? Go here to download the excel file.

The holy grail of residential tourism

At long last I stumbled upon a report that clearly demonstrates the economic benefit of residential toursim on a country. This report was completed in 2004 regarding the Costa del Sol area of Spain and brings together a number of studies to show how important this industry is to that country. An important read in PDF.

Latin America's best business city

The Spanish-language biweekly magazine covering Latin American business, America Economia, looked at 10 key factors, ranging from the size of the cities' economies and population to quality of life and regional brandname to come up with Latin America's best business city. Soa Paulo, Brazil is tops and Carracas and Acuncion the worst. Panama City ranks 14th and the Country of Panama ranked 8th. Read the report here....  

Panama auto sales report

The number of cars sold is a clear indicator of prosperity or at the least perceived prosperity. Here is an interesting report sent to me by a government office on the number and type of cars sold over the past 5 months in Panama and compared to those sold over the last two years. There is a significant increase of 21% over last year and by far the most popular cars sold are Toyota by a wide margin. Ferrari stands at 0 for this year. Download this excel file and look at the details.

Download autos_venta_2006_v_2005total_del_ao.xls

Andean foriegn direct investment report

The Andean countries are the big winners in terms of foreign    direct investments last year, while the CAFTA countries and Mercosur saw mixed results.

BY CHRONICLE STAFF

"Chile and Panama, the only two other countries that are not full members of any regional trade group, both saw small increases in FDI last year. Chile posted a 0.5 percent increase to $7.2 billion, while Panama posted a 1.5 percent increase to $1.0 billion."
Wait until they see next years results for Panama.

Best and worst of Latin Business

Chile is the best place for business in Latin America and Haiti the worst.    Mexico comes right behind Chile, while Brazil only ranks sixth, the Latin Business Index shows.

As Oscar Arias assumes the presidency of Costa Rica, he can rejoice over some good news. His country is the third-best place to do business in Latin America, according to the Latin Business Index produced by Latin Business Chronicle. And Bolivia, which has provoked concern among foreign investors for its gas nationzalition last week, is the second-worst place to do business, the index shows.