New target to revitalize real estate

PANAMA. The traditional residential real estate market is slowing down in Panama and brokers are looking for clients in other areas that they previously thought were too specialized to venture into.

Now Canada has become a prime target for attracting businesses, in hopes of re-vitalizing the housing market.

The Association of Real Estate Agents ACOBIR (Asociación de Corredores de Bienes Raices) is contacting 500 companies in Canada, inviting them to visit the country and establish a branch here.

The president of ACOBIR, Osvaldo Marchena said that currently real estate agents are concentrating their efforts to attract multinational companies to Panama. Many of these economic groups see Panama as the ideal place to use as an exports platform.

Marchena said that currently due to the global financial situation many companies are looking for efficient places on which they can develop their operations. It is not until recently that officially the ACOBIR began marketing Panama’s advantages.

Initially Panama was exploiting the second home market, tapping into the needs of the baby boomers, who were looking for a place in which to pass the winter months. But, because of the global financial crisis the stream of buyers has dried up and the sector has slowed down.

Although the II Panaexpo Fair in Toronto, Canada will promote real estate developments in Panama, a new strategy was needed to run alongside.

According to Marchena the new strategy is to approach Canadian based multinationals to let them know the fiscal advantages that Panama offers in comparison with other countries in the region.

The potential free trade agreements (FTA) with Canada plays an important part to attract this group of potential buyers.

Marcena added that some multinationals are beginning to come to Panama such as Caterpillar, which at a global level has dismissed over 20,000 people, but it is still continuing with its Howard project, opening a training center for Latin America.

Dell has been here for a while and Sony also inaugurated regional training facilities.

Canada is a prime target as the Panama-Canada FTA appears to be moving along fast, and has the support of Canadian Prime Minister Steven Harper.

Marchena said that as part of the strategy ACOBIR launched a promotional campaign in Toronto, Canada and has made contact with 500 companies with the idea that they establish logistic centers here, but at the same time giving them the opportunity to create alliances with other enterprises.

“We are planning to use the same strategy in Latin America, Europe and Asia. These countries see Panama as a good place to be. For example in Tokyo the square meter for rent cost 1,600 euros, while the prices here are just a fraction in comparison.” said Marchena.

The projects that are taking place in Panama are very important, because when these groups come here they need to see a finish product, so depending on what they do there are places available in Costa del Este and Howard has already started the construction of warehouses.

“We are chasing the government asking them to sort out the infrastructure problems and to support the INADEH to train people for the companies to find the personnel they need to operate in Panama,” said Marchena.

The ACOBIR president said that another advantage of companies coming to Panama is that their executives will need housing, offices and distribution areas. Therefore if Panama only attracts 10 companies out of 500, it will have a great impact in the country.