Live From Bocas Del Toro

The Real Estate Espresso Podcast

Live From Bocas Del Toro

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Welcome to the Real Estate Espresso podcast, your main shot of what’s new in the world of real estate investing. I’m your host, Victor Menasce.

On today’s show, we’re coming to you live from Bocas Del Toro in Panama. We came here with the idea of assisting a client with developing a property into a potential resort and a permanent residence community. During our time here, we have gotten to know several of the local business owners, some of which have been here for 20 years while others for about a dozen years.

The rules for foreign businesses operating here are quite clear. You can have no more than 10% of your employees as foreigners, the rest have to be local people. The economy of this community is primarily driven by tourism. It’s a world-class surfing destination with beautiful beaches.

One notable quality about the beaches here, unlike any beach on the windward side of the Caribbean, is their lack of seaweed infestations, making them quite clean and pleasant. The local hospitality industry is characterized by small hotels, seldom having more than 20 rooms. Unlike what you may expect, there are no internationally branded hotels in Bocas del Toro. You’re not going to find a Hilton, a DoubleTree, or a Western.

In my opinion, an expansive air connectivity would have been beneficial to bolster this enticing tourism market. However, the duress created by the current pandemic has led to a truncated air connectivity. The maximum tourism influx capacity to the island stands at approximately 1,400 people a week.

Under the prevailing conditions, hotel occupancy is not as high as you would expect. Until we remedy the stifled air infrastructure, I don’t foresee the market needing any additional hotel rooms. The bottleneck isn’t with accommodation but access. The island also needs critical infrastructure and marketing investments, to attract and accommodate potentially increased demand.

Building in an environment like this is challenging but offers a spectacular experience in return. The climate ensures that properties need constant upkeep, which is indeed a laborious task. Furthermore, the construction expenses tend to be higher due to the frequent repairs to the local roads. They are built and rebuilt three or four times before they’re finished. Despite this, the charm of Bocas Del Toro remains unfazed, continuing to attract those eager for an exotic getaway.

I’ll leave you with a recording that I made yesterday on the beach at Red Frog.

As you think about that, have an awesome rest of your day—go make some great things happen. We’ll talk to you again tomorrow.

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