The team at International Living states that its purpose is to help readers discover special places around the world and take advantage of the opportunities they offer, and the publication has been on the hunt for over 30 years. So when International Living says the following about Nicaragua, it’s worth taking notice: “Nicaragua is virtually unknown–and usually misunderstood–by most people, which is why forward-thinking investors can find some of the best real estate deals on Earth in this country.”
That’s pretty heady stuff, but is one of the reasons the world’s media has begun to pay more attention to Nicaragua and appears focused on “discovering” a country that remains a mystery to many. It’s not unlike the manner in which Costa Rica was “discovered” about 30 years ago, and suddenly became a hot spot for tourism, development and investment—with real estate prices soaring as a result.
A country ripe for growth
Many experts now point to Nicaragua, proclaiming it the next Costa Rica (though many Nicaraguans and ex-pats bristle at the description, pointing out the country’s unique history, culture and beauty). Even International Living claimed that the country’s unspoiled Pacific Coast is ripe for positive growth: “We believe this stretch of coastline is primed to explode onto the world stage, and that if history is any guide, real estate prices could skyrocket here as much as 500% in the next few years.”
Again, pretty heady stuff. But not unwarranted given the strong economic progress being made in Nicaragua, with outside investment, tourism and exports increasing steadily. More and more visitors—and new residents--are finding their way to Nicaragua, drawn by its natural beauty, abundance of activities, beaches, low cost of living and opportunities to start fresh, including retiring or settin up a business. Major international companies are finding their way to the country. For example, Wyndham Hotels, the world’s largest lodging company, has planted its flag on Nicaragua’s Pacific Coast at Milagro del Mar Beach & Golf Resort, which emerged from the recent economic downturn with new strategies and renewed vigor. Now the Wyndham Ocean Village is underway and set for a 2014 completion, and sales are gaining momentum.
Making “smart investment sense”
The International Living team—which has invested in Nicaragua—offers a long list of reasons the country “makes smart investment sense.” These include:
A “boom trend” of infrastructure improvements and foreign investment, with the latter topping $280 million last year
Projected GDP growth by an average of 6% or better over the next several years, which is unprecedented
U.S. News & World Report consistently rates Nicaragua as one of the world’s top places to retire
The growing trend to relocate on a global scale, with the publication noting, “Overseas retirement real estate is going to be big business in the coming years. As the baby boomers begin to retire, more people are going to look outside of the United States for real estate, second homes, and retirement homes.”
Nicaragua offers nearly unequalled advantages, including a low cost of living, a light tax burden and excellent incentives to start a business.
Getting in on the ground floor
At one point, before the last downturn put a damper on development worldwide, there was a tendency to preach that if you missed out on the gold rush in Costa Rica, then Nicaragua was going to be your next chance. It became a cliché, but today it may simply be a statement of fact and the reason the focus is turning here now. As the publisher of International Living stated in conclusion to his article, “As the publisher of a newsletter that investigates the world’s best places to travel, buy real estate, invest, live, and retire, I know that the opportunity to get in on the ground floor of a place like Nicaragua does not come along very often.”
Read the entire International Living article here.
The head of a real estate development company involved in Latin American projects recently offered a comparison of “real” prices between, for example, a condo in Miami and one in a more southern location, such as Nicaragua. He rightly noted that, while the price per square foot for a Miami condo is lower in some select cases—at least right now--the actual cost of living ultimately will be much higher when factoring in taxes, HOA fees and daily essentials.
This leads to consideration of the fact that taxes in most Central American countries are considerably lower that found throughout much of North America, with retirees generally paying much less, or even exempt from property and other taxes. HOA fees also average much less due to lower labor costs. And with real estate prices in many North American locations now beginning to rebound, the price per square foot difference is likely to narrow or completely disappear in the very near future.
More people are looking offshore
This reality is what is leading more and more individuals to look offshore for ownership and retirement options. In fact, AARP estimates that more than half a million Americans now live outside the United States, with other studies indicating more and more people are considering such possibilities to maximize funds and assets.
Nicaragua, for example, is a welcoming haven for retirees, enhancing this status with the passage several years ago of laws that are the most benefit-laden in Central America. Eligible retirees, for example, pay no taxes on out-of-country earnings, can import up to $20,000 worth of household goods completely free of import taxes, and bring in a vehicle for personal use (up to a value of $25,000) completely free of import or sales tax. And the income requirements to gain retiree status are extremely low.
Lower cost of living enhances quality of life
A much lower cost of living allows ex-pats and retirees to enjoy a very comfortable lifestyle, in many cases beyond what would have been possible in North America. Not to mention the allure of a more simple, yet fulfilling existence in a beautiful country that values culture and tradition—with very nice weather. As International Living puts it: “Nicaragua’s lower cost of living does not mean you have to sacrifice the quality of life you have been accustomed to in the U.S. or Canada. In fact, you will probably be able to live in Nicaragua with even more luxuries than you are accustomed to, simply because the prices are so economical.”
The real estate developer acknowledges that pursuit of a dream retirement has evolved greatly in recent years, particularly after the economic downturn. He points out correctly that considering cost of ownership is an important factor in selecting real estate investments, but measuring quality of life also should play a key part in the decision. That’s why he and other market observers encourage expanding the search to include an examination of offshore opportunities.
Don’t discount the possibilities
Certainly, for some of us, it’s a bit unnerving to consider life outside of what we know best, where we’re comfortable. There’s conflicting information to sift through and evaluate, and many differing opinions on the right place that offers all the right things. The bottom-line, however, is that making the best possible decision requires expanding the search to include possibilities that may have, once upon a time, seemed strange and remote. The truth is that the world has changed dramatically, and the options and opportunities now may not be where we once thought they were.
As Thomas Edison once noted, “When you’ve exhausted all possibilities, remember this—you haven’t.”
The country of Nicaragua has become an object of attention, even affection for the media, particularly from North America. Articles have begun to proliferate that treat the country as a newly discovered exotic world in Central America, full of tropical beauty, old-world culture and simmering mystery. Nicaragua is touted in the press as a great place for a vacation adventure, a welcoming environment for business, a refuge for savvy retirees, a destination for travelers seeking an off-the-beaten path experience.
Focus on the present
And, the truth is, it is indeed all those things, and more. However, one constant in the media coverage continues to be an inability to forget the past and focus on the present, and the future. In virtually every article and report, no matter how positive and glowing otherwise, are certain keywords tied to Nicaragua’s now distant past: civil war, Sandinistas, Oliver North, Iran-Contra, FSLN, political upheaval, General Somoza, etc.
Granted, the Sandinista Party remains a major force in the country’s politics; however, Nicaragua is a stable democracy, and has been for over 30 years. There are numerous parties and organizations that share the political process, and work toward common goals related to improving the country’s economy, enhancing its image on the world stage and serving the needs of its citizens, while preserving the traditions, beliefs and culture that long pre-date the arrival of Spanish explorers. As with any democratic process, it can be messy and noisy and occasionally volatile. Nevertheless, the country benefits, with Nicaragua’s future becoming brighter as foreign investment rises, the economy continues to expand and more travelers find their way here.
The past still haunts Nicaragua
Unfortunately, too many people, particularly in North America, know Nicaragua still only as that country where civil war raged for years, where foreign politicians intruded and dabbled during times of fervent anti-communism, where an American administration under a popular president was revealed as an interloper with often misguided interests. Many people involved in business in Nicaragua know the look, the tone of voice that implies only memory of a distant time, rather than knowledge of the country’s current position.
This is not to claim Nicaragua is shiny and new, with all relics of the past forever banished. There always are reminders of history, both good and bad, in virtually every country—many Americans, for example, still struggle with issues dating back to the War Between the States. Nicaragua still suffers from damage done by dictators, political unrest, fiscal crisis and natural disasters that crippled the country’s economy for decades. But now the country is moving forward aggressively and more unified in its objectives.
Media: Focus on the present and future
Which brings this back to a request to the media: Please stop prefacing coverage of Nicaragua with an immediate look backward to events now 30 years past, and instead focus on the many positive aspects the country possesses. Quite frankly, that’s likely much more enticing to today’s individuals interested in places to visit and explore, even relocate and retire. Talk about the country’s economic progress, its incredible biodiversity, the rich culture of art, music and literature, its warm and friendly people, the business and investment opportunities, its attraction as a destination to explore with much to offer the intrepid traveler.
If you’re a reporter with a question or a need for balanced information, get in touch. Being on the ground here provides perspectives and insights not available from a distance. Better yet, come for a visit.
Adding the Wyndham Hotel is another key step in the evolution of the resort as managing principal Roger Keeling contemplates the future.
It’s now official: Milagro del Mar Beach & Golf Resort is joining forces with Wyndham Hotel Group, the world’s largest hotel company, to add an upscale 212-room hotel to the resort’s Ocean Village. It’s a long anticipated announcement that further solidifies Milagro del Mar as a leading destination on Nicaragua’s Pacific Coast and brings the Wyndham flag to the country for the first time.
“We look forward to welcoming the impressive Wyndham Milagro del Mar Resort to our brand family and providing travelers who visit this stunningly beautiful country with best-in-class accommodations,” said Daniel del Olmo, Wyndham Hotel Group’s senior vice president and managing director of Latin America. Those sentiments were echoed by Roger Keeling, managing principal of Milagro del Mar, who said, “It’s very exciting to establish a partnership with such a respected international hotel company, and it’s a major step forward for the entire region.”
This agreement adds new impetus to the recent surge of development and construction at Milagro del Mar after a strategic decision to slow the pace in response to the recent economic downturn. The aggressive move forward was bolstered by additional funding from investors and renewed sales activities. For Keeling, it’s a time to reflect on the path to this point and renew the vision that brought him and his family to Nicaragua six years ago, as well as answer questions about the future.
Patrick Hiebert, Roger and Carolyn Keeling of Milagro del Mar join Wyndham’s Director of Development for Latin America, Louis Alicea (second from right), in celebrating the new alliance in Nicaragua, while construction gains momentum on site.
First, how would you describe Milagro del Mar Beach & Golf Resort to someone who is unfamiliar with it.
We consider Milagro del Mar to be a welcoming community ideally situated on a wonderful three-mile stretch of beach on Nicaragua’s Pacific Coast, which offers a range of residential options, and attractive amenities and recreational opportunities. We’re working right now on a roughly 500-acre site that includes homes and homesites, condominiums and a hotel under construction, an eco-neighborhood, as well as a golf course.
What does the addition of Wyndham mean to Milagro del Mar?
Obviously, bringing in the world’s largest hotel group gives us tremendous marketing power as we move forward, as well as credibility for our efforts. This credibility is extremely important to the people who choose to vacation or live here because it demonstrates our commitment and financial strength. We made the choice, which has proven to be the correct one, to slow down our efforts when the world economy dipped. As markets improved, we’ve aggressively relaunched our project, and adding Wyndham should be proof that we’re serious about our vision and absolutely committed to making Milagro del Mar the finest possible resort.
Why was Wyndham the right choice?
Again, Wyndham Hotel Group is the world’s largest hotel company, with over 7,000 properties around the world. But we also were particularly impressed with the company’s desire to work in Central America and, in particular, here in Nicaragua. Over the last two years, we had talked with several premier hotel groups and had some productive discussions. However, once we began to talk with Wyndham, we immediately felt the synergy was right.
What impact will the Wyndham presence have on Nicaragua, and, in particular, the country’s Pacific Coast.
It’s been very pleasant to watch Nicaragua step forward and prove on the world stage that it’s a progressive, pro-business country with a stable government that wants to improve the lives of its citizens. When organizations such as Wyndham elect to come here, it strongly reinforces the image of Nicaragua as a good and promising place to do business, and this attracts more investment and creates more opportunities for the people here. Having a strong name like Wyndham’s now established on the Pacific Coast further demonstrates this is a welcoming, unique, safe and exciting place to visit and explore, even live and work. Quite frankly, I don’t think we truly realize yet just how much impact this will have.
Nicaragua is being featured more and more in the media as an up and coming destination. That should be helpful for the country and Milagro del Mar.
It’s definitely helping put Nicaragua on the radar of travelers seeking a new and exciting place to visit, and the country’s rise in tourism over the last couple of years is a clear indication of this acceptance. We’re also seeing quite a bit of coverage related to Nicaragua as a good place to retire, or just escape the rat race and establish a new lifestyle.
One thing that seems to inevitably come up in media coverage of Nicaragua is mention of the country’s past. Is it possible that will ever go away?
It is interesting how virtually every recent news story somehow always manages to mention Oliver North or Iran-Contra or some other negative aspect of the country’s history. What we like to point out is that stuff happened over 30 years ago, and, since that time, there has been significant change here. It’s a safe and peaceful place—generally recognized as the safest country in Latin America. There is a stable, democratic government that is taking the proper steps to become a positive and meaningful force in the region. And what’s too often ignored are the hardworking, friendly citizens, the natural beauty and the culture. Anyone who visits here is in for a very pleasant surprise.
Now that the Wyndham name is attached, what are the plans for the hotel?
The hotel, which will be called the Wyndham Milagro del Mar Resort, will have 212 rooms and will be a centerpiece of our eight-acre Ocean Village, which is the heart of Milagro del Mar. The hotel, condominiums and villas within what now will be called Wyndham Ocean Village will have a Spanish Colonial look based on the traditional architectural styles found in the country’s colonial cities of Granada and León. It’s a very open and comfortable look and feel, combined with all the modern features and amenities. We want people to understand that when they come to Milagro del Mar they’re going to have a resort experience comparable to virtually any other place they might go.
What else is planned for the Ocean Village?
As mentioned, there are some very luxurious condominiums under construction, with a collection of villas to follow—all located just a few steps from the ocean. Of course, there also will be pools, restaurants and bars, retail shops and other amenities.
Where does construction stand at this point, and what are projected completion dates?
Work is well underway now on the condominium buildings, which have 42 units, and hotel, with openings planned for 2014.
Are you pleased with sales to date?
We’ve been pleased with our sales activity, particularly in recent months as we’re cranked back up our construction and development. Certainly, the Wyndham announcement is expected to increase interest in the few remaining units available in this first phase, and people who were waiting for an economic recovery are realizing now is the time to act. We’ve also just announced a fractional ownership program that already is generating a great deal of interest since that’s an approach that makes financial and logistical sense for many people.
A nice feature for our condominium owners is that their units are eligible to be part of Wyndham’s property management and rental program.
There’s much more involved in Milagro del Mar than just the Wyndham Ocean Village. Can you expand on the vision?
In addition to the village, there already are more than 30 private residences in the resort, and more under construction or scheduled to start soon. Our eco-community, Milagro Verde, has some very earth-friendly and innovative homes nearing completion under the guidance of Patrick Hiebert, one of our managing partners. There is a nice selection of homesites still available, both close to the ocean and along the golf course. The golf course will be a primary feature of what will become the Country Club of Milagro del Mar.
What will the country club feature?
We’re already planning to add a second nine-hole layout to our golf course, giving us a full 18 holes. And we have the land available to add a third nine. There will be a central clubhouse that we feel will be an ideal gathering spot for visitors and residents, with a pool, tennis courts and fine dining facilities.
Do you foresee golf becoming a major attraction?
There is growing interest in golf around Nicaragua, but still very few courses. So, we’re already seeing a good deal of play and know adding the second nine will increase the appeal. Right now, we’ve been working very hard on improvements to the existing course to make certain we provide an enjoyable experience for players. We’re also offering special packages we hope will bring groups out to play and stay, and enjoy other parts of the resort.
Surfing is a big draw now for Nicaragua. Is that something beneficial to Milagro del Mar?
We’re very lucky to have two of the top surf breaks in Nicaragua on our beach, including one that’s ranked among the top in Central America. More and more surfers are finding us since we offer world-class waves along with lodging in our Las Perlas condominiums, and food and beverage in our oceanfront restaurant. We also have a full-service surf shop on site that offers equipment and board rentals.
Besides golf and surfing, what other amenities and activities are offered?
We believe we have something for just about anyone at Milagro del Mar, even if you just want to relax on the beach. We have a stable and offer horseback riding, which includes along the beach and guided tours around the area. The fishing is excellent off the beach, and we also can arrange offshore fishing trips. Spa treatments are available right on the beach, and we have a trained naturalist who provides guided nature walks.
Our on-site concierge company, La Vida Nica, can set up just about anything for guests, such as visits to Granada or León, or eco-tours to volcanoes and nature preserves.
There also is a full-service restaurant here that serves breakfast, lunch and dinner, and has a full bar. And it’s situated on the beach and is a great place to enjoy the sunsets over the Pacific.
Who are the people coming to Milagro del Mar, and what is attracting them?
We have property owners from all over, though the majority right now are from North America. We also have people who come to the resort from around Nicaragua and surrounding countries that enjoy being able to come to the beach and relax, for a weekend or a week. And some of them also are considering purchasing property to have a getaway that’s not too far from home.
The attraction certainly is the tropical weather, beautiful coastline, a full-service resort and reasonable prices, compared to other destinations. Nicaragua offers tremendous value, along with friendly people and unbelievable natural beauty. For people coming to live here from outside the country, the cost of living is very low compared to North America. That’s making Nicaragua a popular choice.
So Nicaragua and Milagro del Mar are becoming popular with retirees?
The country is showing up on more and more lists of places that retirees should consider, and that’s generating a great deal of interest among those wanting to maximize their assets. You can enjoy a very comfortable lifestyle here, with access to excellent healthcare. There also are some laws and tax advantages that add to the appeal. We’re always happy to answer questions and help people find more information.
How are Milagro del Mar and Gran Pacifica connected?
Gran Pacifica is the original master-planned development that started here a number of years ago, encompassing over 2,500 acres. Originally, Milagro del Mar was just the eight-acre site that is now our Wyndham Ocean Village. Now, through subsequent acquisition, Milagro del Mar totals roughly 500 acres that includes the village, golf course, beachfront condos, homes and homesites, and the Milagro Verde eco-community. We like to refer to ourselves as the heart of Gran Pacifica.
How is Milagro del Mar involved with the local communities?
When Carolyn and I first moved to Nicaragua from Atlanta in 2007, one of our goals was to become involved here and do everything we could to support local efforts. Certainly, through Milagro del Mar and related activities, we’re able to provide jobs for a number of local residents, and that will increase as the resort continues to expand. The opening of the Wyndham Hotel should add about 300 jobs.
We created the Hope & Development Foundation to work with local leaders to assist people in the surrounding area through vocational training, educational programs and healthcare programs. We’re also very excited that Milagro del Mar will be the site of the International Baseball Academy of Central America, which will train young local players, but also offer vocational and educational opportunities.
It has to feel good to have reached this point.
We consider ourselves to be very blessed in the opportunities that have presented themselves and the progress we’ve been able to make, with the help of a great team of people and property owners who believe in our vision for Milagro del Mar. We’re confident that, as the name says, we’re creating a “miracle by the sea.”
In a recent editorial in the Nicaragua Dispatch, editor Tim Rogers very clearly stated something that is strongly believed by many people who live, work and invest in Nicaragua: It’s time for the rest of the world to forget about the country’s past and focus on the promise and progress now found here.
As Rogers elegantly points out, Nicaragua has become a “darling of the mainstream travel industry from New York to London.” It’s very evident that writers and reporters have found in Nicaragua a good story about a special place that is coming onto the world stage through hard work and perseverance. There are now many individuals, whether intrepid travelers or working writers, who feel they’ve “discovered” a new world, who act like explorers taking the first steps into an unknown land.
An Authentic Place
The truth is that one of Nicaragua’s charms and strengths is that it retains a certain natural serenity and beauty that can’t be manufactured. It’s a place of authenticity, with an elaborate history and deep-rooted culture that should be the envy of many other destinations. Yes, it still has its gritty edges and, like virtually every country in the world, its fair share of challenges. However, as more and more people are discovering, there is an alluring mystery and natural diversity in Nicaragua that qualify it as a very special place, and one worth visiting and knowing.
The Complete Dispatch Editorial
That said, let’s allow Tim Rogers to speak his piece on the subject, revealing the passion of one who is committed to the country and believes in its rightful future:
After years of budding tourism growth, Nicaragua is suddenly coming into bloom as the new darling of the mainstream travel industry from New York to London.
In the past few months, Nicaragua has made U.S. News & World Report’s lists of top colonial retirement destinations and Best Overseas Retirement Options, was named the No. 1 “Emerging Destination” by Wanderlust Travel, and ranked No. 3 on the New York Times’ list of 46 places to visit this year.
It seems that if you’re going to make a Top 10 list of places to visit this year—something travel writers do with OCD regularity—you better put Nicaragua somewhere close to the top, preferably in the top three.
Travel writers, like most tourists, love Nicaragua. It has all the beauty, adventure, history, grit, affordability and sex-appeal that one would want in an up-and-coming vacation spot. It’s edgy but not dangerous; friendly but not phony; trendy but not mainstream. For travel writers, Nicaragua is a story that practically writes itself.
Why is it, then, that so many journalists seem to have a hard time writing about Nicaragua as an emerging travel destination without using trite caveats and tired references to the country’s problems of the past? Why is Nicaragua still better known for what it was than what it is?
Even The New York Times, the journalism industry’s newspaper of record, seems bewildered by the fact that Nicaragua is no longer the same country it was in the 1980s. In its write-up of Nicaragua for its list of countries to visit this year, the Times reports, “If the name Oliver North means anything to you, there’s a good chance that Nicaragua doesn’t jump to your mind when you think of a relaxing, high-end, spa-filled vacation.”
That’s sort of a cheap shot. It’s like saying, “If the name Jayson Blair means anything to you, there’s a good chance that New York Times doesn’t jump to your mind as a reliable source for travel lists.”
Wanderlust Travel was also unable to recognize Nicaragua for its merits as a travel destination without first mentioning the country’s troubled past. “Nicaragua might have had a turbulent past, but its travel-future is looking bright,” the British travel publication reported last month.
Despite nearly a decade of positive travel press, Nicaragua’s tourism industry still has a hard time standing on its own two feet. Even in mainstream travel stories, the country’s tourism industry still needs to be set up by a subordinate clause referring to revolutionary unrest from 30 years ago.
People’s expectations for Nicaragua are still based more on the events of the 1980s than the achievements of the past decade. No country in the world is without prior problems, but few other countries get the same treatment in the media.
Just compare the Times’ write-up of Nicaragua (“For the past 30 years, the country has been fighting its image as a land of guerrilla warfare and covert arms deals”) to its description of Ghana, which ranks fourth on its list: “Accra, the capital of Ghana, has welcomed business travelers for years.” If Ghana had gotten the “Nicaragua treatment,” the write-up would have read more like, “If you remember Ghana’s back-to-back military coups in 1979 and 1981, which led to the suspension of the country’s constitution and the collapse of the national economy, there’s a good chance that Accra doesn’t jump to your mind as a city that is welcoming to business travelers.”
Part of the media’s obsession with Nicaragua’s past is a problem of the country’s own making. Nicaragua’s president is the same guy who was in power 30 years ago, and he likes to harp on the past more than most people.
The constant reminders of Nicaragua’s past speaks to the failure of politicians to articulate a coherent new vision for the future and also the mainstream media’s failure to keep people informed about what’s going on in this part of the world. The last time the international media much paid attention to Nicaragua was during the war in the 1980s, so when journalists write about the country now they feel the need to pick up the old narrative thread before reporting on what’s changed since then.
While Nicaragua’s international image has been slow to move out from the shadow of its past, the good news is that tourism, perhaps more than anything else, has the power to accelerate the country’s image makeover and recast Nicaragua as a friendly and inviting place. But Nicaragua needs to do more to articulate a vision for the future of its tourism industry and shape policies to guide that growth.
Nicaragua has all the natural ingredients its needs to become a world-class tourism destination, but the country is making Top 10 lists for the editorial shock value of a country that exceeds people’s low expectations. That was fine for a while, but it’s not enough to grow on. It’s time for Nicaragua to evolve into a tourism destination that can be written about without mention of Oliver North.
Once Nicaragua can articulate a clearer vision for its future—one in which tourism will play a leading role—the rest of the world will start to see Nicaragua more clearly for what it is and what it aspires to be, and not for what it once was.
Nicaragua may never be known as a mainstream travel destination, but tourism–if done correctly– can at least help it move beyond its old reputation as a war-torn backwater.
From the February 5, 2013 issue of Nicaragua Dispatch
The team at Milagro del Mar Beach & Golf Resort is committed to the vision of Nicaragua as a wonderful place to visit, live, work and retire. To learn more, visit our website at www.milagrodelmar.com
With a new year always comes, in addition to resolutions, a sense of renewal and perhaps even a fresh start. That certainly is the case for many investors who were actively and intently pursuing vacation home purchases or personal real estate investments in 2008/2009 before the world markets slid downhill. Certainly, it now is very clear that real estate markets have changed dramatically and perhaps permanently in some ways—particularly in the expectation of constant appreciation of property that often was the fuel for a purchase.
Wisely, many people stepped back, put plans on hold and, so to speak, sat on the fence to watch what was going to happen. That’s where many remain coming into 2013, particularly the most fiscally conservative.
However, both research and anecdotal evidence indicate that many individuals are taking a fresh look at the possibilities and opportunities, particularly in light of the aggressive pricing available in many markets for certain types of products. The research also reveals that several categories of potential investors are emerging.
Ready Then, Ready Again?
The first is the person who was close to undertaking a real estate purchase when the market uncertainty kicked in and climbed onto the fence. While that move was a smart one, it did little to diminish the desire to own, for example, a vacation home in a favorite destination. It simply put that desire on hold. Now, this person is observing the positive movement in the economy, including improvements in real estate, and feeling the urge to act. In some cases, this sense of growing urgency is fueled by the belief that prices are at or near all-time lows, making it an ideal time for action. Others may have wanted a getaway place for their families or a retirement spot, and now have seen five years pass. This has reduced the time for family enjoyment, especially as children grow up, or brought retirement that much closer. This group is seen as ready, and already beginning, to jump down from the fence and get on with their lives. They’re tired of waiting and ready again to embrace the life they want.
A subsector of this group is still watching and waiting. Perhaps they’re younger and have more time, or they have reassessed their needs and desires over the last few years, selecting an altered path as a result. Or, unfortunately, the economic downturn has taken its toll due to loss of a job, a business setback or deterioration of personal investment funds. This is the group that will move most cautiously and likely will not act based simply on a sense of renewed economic vigor, but will react only to solid signs and opportunities. They will, however, keep looking, thinking and shopping. Those offering real estate will do well to respond to these individuals with reliable information, not sales jargon and promotions.
The “Aspirational” Buyer Emerges
A third group is the emerging “aspirational” buyer—an individual or family that is moving now into a point in life where they are able to consider a discretionary investment, such as a vacation home, and the desire is growing. This may be a sign of success, or they have seen others take the step and feel the time is right for them to follow. Members of this group are predominantly in their mid-30s to mid-40s, moving forward successfully in their careers, becoming comfortable with their lifestyle and considering the next step. Many have young families and are influenced by a desire to provide something special to their children—perhaps a lifestyle they didn’t have themselves.
This also is a more adventurous group that may be motivated to consider more exotic locations, both to step away from the norm and capitalize on perceived opportunities in markets that offer more potential return on an investment. Bermuda or Costa Rica, for example, may seem tamer than Nicaragua or Panama, as well as more expensive and less likely to potentially generate return on an investment.
Don’t Forget the Boomers
There are, of course, members of another group that may be on the fence and considering action—the Boomers. At 78 million strong in the United States alone, the Boomers remain an economic force as they enter their 60s. For those that had not acted previously, the economic woes may have proven to be a setback that both depleted savings and assets—this is a group deeply invested in personal housing—and diminished the willingness to take on any type of risk. With retirement looming, many will find safety on the fence.
For those Boomers who have looked forward to and want an active lifestyle, they’re probably ready, willing and, most importantly, able to take the plunge—even eager as they age. This is a group in which pent-up desires and demand provide tremendous motivation to grab for the perceived “good life,” and push forward. These are the people for whom the message “life is too short to wait” is compelling.
Among the Boomers are those already retired or on the verge who are actively looking for ways to maximize their funds and assets, both to preserve them and enjoy a comfortable life. This group is looking offshore in many cases to locales where they can stretch their dollars. The editors of International Living, for example, recently ranked the “cheapest places to retire,” which was based on the cost of essentials—rent, food, utilities, healthcare, etc.—but also factored in everything from solid infrastructure to government stability to good weather.
As selected, the five cheapest places to retire and live offered couples a comfortable lifestyle for $1,000 to $2,200 per month. Topping the list was Nicaragua where it was noted “a couple can live well for $995 per month”—which included a maid three times per week. Joining Nicaragua on the list were Malaysia, Ecuador, Panama and Mexico.
Time to Act?
The bottom-line is that the fence may no longer be the best place to be, especially if you feel opportunities may be slipping away as economic conditions continue to improve. The question becomes for many, when to jump down and act.
Interested in learning more about your options?
Tourism and foreign investment underscore strong positive trends as Nicaragua continues to emerge as an economic force
The continuing news about upward and improving economic trends in Nicaragua is almost becoming redundant—but in a very good way. After lagging behind its Central American neighbors due to long-ago internal strife, the country now has emerged as one of the world’s economic bright spots, making significant progress even during the recent international downturn. Two important bright spots again are advances in foreign direct investment and tourism.
Foreign direct investment (FDI) is considered by economic experts to be a key indicator of a country’s business climate, and Nicaragua is enjoying another record year in this area. In 2011, FDI in Nicaragua reached a record level of $968 million USD, a 91% improvement over the previous year. Indications are that FDI will top $1 billion USD in 2012, demonstrating that Nicaragua has become “one of the most dynamic economies in terms of attracting investment in Latin America and the Caribbean,” according to Javier Chamorro Rubiales, Executive Director of PRONicaragua.
Foreign Investment in Nicaragua Continues to Rise
Other strong results underscore the country’s dynamic economic push. The Central Bank of Nicaragua announced that the country’s GDP growth during 2012 will reach 4.1%, while the Latin Business Chronicle noted that Nicaragua reached its highest FDI/GDP ratio in 2011 with 10.4%, with expectations of that trend continuing for 2012. The country also posted the highest index of FDI as percentage of the GDP in Latin America, with a total of 13.3%, followed distantly by Panama with 9.1% and Chile with 7.0%.
The Central Bank (known as BCN by its acronym in Spanish) also reported that Nicaraguan exports topped $2.2 billion USD in 2011, a 22.3% improvement, with improved performance expected for 2012.
Another strong indicator came in the 2013 “Doing Business Report,” published by the World Bank, that showed Nicaragua improving its overall ranking, with positive developments in the “Trading Across Borders” and “Resolving Insolvency” categories. At a regional level, Nicaragua outranked the rest of the Central American countries in the categories of “Protecting Investors,” “Enforcing Contracts” and “Resolving Insolvency.” This is the third consecutive year the country has improved its position within the report, whose goal is to provide an objective basis for understanding and improving the regulatory environment for business in 185 economies around the world.
“We believe it’s very important for people interested in Nicaragua, whether as visitors or investors, to understand the positive momentum here,” says Roger Keeling, managing principal of Milagro del Mar Beach & Golf Resort. “The level of interest we’re experiencing and the growing awareness of the country is very positive for everyone doing business in Nicaragua.”
Tourism a key to economic improvement
Tourism remains an important area of improvement in Nicaragua, as well as a key economic driver. The Nicaraguan Tourism Institute (INTUR) reported the country has an almost 12% increase in total arrivals thus far in 2012, compared to 2011. Official projections are targeting 1.2 million arrivals by the end of December, another record mark. Overall tourism in Central America experienced 6.8% growth during the quarter of 2012, according to comparative numbers reported by the Economic Commission for Latin America and the Caribbean (CEPAL). Mexico’s tourism industry, in comparison, is up only 1.3%.
Calvet & Associates, a consulting group based in Nicaragua, offered an interesting breakdown of tourism categories in its recent weekly newsletter, based on information gathered from a variety of sources. In terms of lodging, 84% of hotel stays were by individuals from outside Nicaragua, with guests coming predominately from the United States (54%) and other Central American countries (42%). Group travel accounted for just 32% of activity, compared to individuals.
In terms of individuals purchasing real estate in Nicaragua, the large majority (87%) came from the United States, with Canada accounting for 9%.
Nicaragua Challenges Costa Rica
An interesting head-to-head comparison with Costa Rica, long considered one of the most economically active countries in Central America, strongly illustrated the progress being made in Nicaragua. In terms of projected GDP growth for 2012, Nicaragua is expected to post a 3.6% gain, while Costa Rica is at 3.8%. Growth in exports to date show Costa Rica at 10.9% and Nicaragua at 8.9%, which indicates the continuing strong performance in this area for Nicaragua. Projected
hotel occupancy rates for 2012 are also close with Nicaragua at 63%, while Costa Rica is projected at 70%.
Such strong economic indicators are one reason that Carlos Pellas, one of Nicaragua’s leading businessmen, sees the country poised for more positive growth. During a recent ceremony to honor him with the country’s top business honor, the Nicaraguan-American Chamber of Commerce’s Business Excellence Award, Pellas stressed his belief that visions of growth are taking hold. He says Nicaragua is making great economic strides and gaining momentum as a world-class tourism destination.
“Vision without action is a dream,” Pellas said at the ceremony. “Action without vision is a waste of time, but vision and action together can change the world. We need to dream, but we also need to act.”
That positive outlook is echoed by Keeling. “For those of us committed to Nicaragua and its future, it’s reassuring to see the growing interest,” he says. “It seems safe to say that the country and its virtues are no longer secret, and that the positive trends seem destined to continue.”
After throttling back its activities in 2009 in response to the economic downturn, the team at Milagro del Mar Beach & Golf Resort in Nicaragua is once again pressing ahead and anticipating a bright future under an aggressive relaunch strategy. Construction of the Ocean Village luxury condominiums is back on track, an innovative eco-community is underway and new custom homes are under construction. In addition, the master plan for Milagro del Mar has expanded and now anchors approximately 500 acres of oceanfront property along the Pacific Coast of Nicaragua.
There also will be a forthcoming announcement on an international hotel partner for Milagro del Mar, according to Roger Keeling, who heads The Keeling Group (TKG), which is developing the luxury resort. He terms the involvement of the hotel as “major in scope, and one that will have a significant impact not just on Milagro del Mar but the entire Pacific Coast of Nicaragua.”
The evolution is underway
As it begins this new evolution, Milagro del Mar Beach & Golf Resort
already features a collection of existing beachside condominiums and a number of private homes. A nine-hole golf course is open for play, with an additional nine-hole layout planned for the next phase of expansion. Eventually, the resort will house the Country Club of Milagro del Mar
, offering golf, tennis, fine dining and other recreational activities.
Other amenities currently include an oceanfront restaurant and bar, a surf shop and ready access to two world-class breaks, a stable offering horseback riding, and La Vida Nica, an on-site concierge group that provides a range of services to property owners and resort visitors. With rentals and packages available, Milagro del Mar has become a favorite vacation destination for individuals and families from throughout Central America, the United States and Canada.
“We were able to weather the downturn and actually profit from it in terms of additional planning and the opportunity to expand our land holdings,” says Keeling. “We were able to put new financing in place and are now poised to push forward quickly in what we feel is a rapidly improving market. We also are benefiting from the strong economic expansion here in Nicaragua, which is seeing significant gains in outside investment and tourism, as well as phenomenal growth in its GNP.”
Master plan revised and expanded
The new master plan was substantially revised and expanded after TKG acquired properties and amenities that were previously part of Gran Pacifica, a master development. The revamped plan still centers around the newly named Ocean Village, a neighborhood of two- and three-bedroom condominiums and villas situated on land sloping gently toward the ocean. The architecture bears the stamp of Spanish Colonial elegance, with virtually every residence enjoying an ocean view. The terrace level of the main building features its own infinity pool, restaurants and bars, an exercise center and retail shops. The first condominiums are set for completion in the first quarter of 2014.
Eco-community now underway
Homes also are underway in Milagro Verde, an innovative eco-community
designed “to provide green living without sacrificing luxury
.” The carefully planned neighborhood carries the Spanish Colonial feel into “right-sized” single-family homes that feature geothermal heating and cooling, passive solar water heating, gray water recycling, and efficient lighting and appliances to reduce energy requirements.
“We’re including a variety of green products and techniques, and will continue to evaluate new technologies and approaches,” says Patrick Hiebert, the TKG principal who is heading the development of Milagro Verde. “In addition to feeling good about living in a low-impact home, owners will enjoy the financial benefits of generating their own power and using substantially less water each month.”
For those interested in building a custom home, Milagro del Mar offers homesites adjacent to the ocean in the San Diego Viejo neighborhood, and homesites along the golf course in what ultimately will become the Country Club of Milagro del Mar. The resort community already contains a number of custom homes and casitas, with other owners planning to begin construction in the near future.
To reestablish awareness and generate interest, TKG has begun the first stages of a significant branding and communications effort that supports its new sales program. Initial steps included a refined identity package and enhanced website.
“The interest we’re receiving has been very positive, and more and more people are expressing the desire to come for one of our special in-country tours to learn more about Nicaragua and what we’re doing here,” Keeling says. “There are numerous people who have been holding off on decisions until they felt the economy was improving, but it appears many are now ready to move ahead.”
Nicaragua enjoying upward trends
According to Keeling, both Nicaragua and destinations such as Milagro del Mar are gaining momentum from improving world and local markets. The country has experienced steady upward trends in most sectors of its economy, and its recognition is spreading as a safe and welcoming place to visit, invest and live. Keeling points out the appeal of the low cost of living, available healthcare and favorable tax laws to retirees seeking to maximize their funds, while noting that there also are many “value seekers” who have recognized the lucrative investment opportunities in Nicaragua.
At one time, developers and speculators regularly referred to Nicaragua as the “next Costa Rica,” which has now produced a strong in-country backlash. Tourism Minister Mario Salinas recently stated publicly that Nicaragua is not the “new Costa Rica,” and has no interest in such a comparison. “We don’t like that, because we think we have a diversity of offerings—a culture and a history—that Costa Rica never had,” Salinas said in a talk to the Nicaraguan-American Chamber of Commerce (AMCHAM).
However, because Nicaragua lagged behind its Latin American neighbors due to internal strife that ended over three decades ago, there are still low prices found within the country for real estate and the potential for healthy returns over time as was experienced in Costa Rica. In fact, International Living, which is recognized for its ability to spot trends, reached the following conclusion about the future of Nicaragua’s Pacific Coast: “We believe this stretch of coastline is primed to explode onto the world stage, and that if history is any guide, real estate prices could skyrocket here as much as 500% in the next few years.”
Creating a sustainable vision
While Keeling and Hiebert acknowledge such speculation is a pleasant topic of conversation, they are concentrating on creating a sustainable vision for Milagro del Mar that will make it both an excellent investment and a place to be enjoyed by a wide variety of visitors and property owners.
“Needless to say, it’s exciting to crank up our activities again,” Keeling says. “It wasn’t easy to wait, but it certainly was the right thing to do and now ideally positions us to move forward and create new momentum. It’s often said good things come to those who wait. For us, we now believe better things are coming for those who have waited.”
A recent article pointed out that Nicaragua is a leader in the race for green energy--not just in Central America, but the world. According to The Nicaragua Dispatch, the country hopes by 2016 to generate 94% of its own electricity from renewable energy sources, and only burn enough oil to cover the remaining 6% of its demand. With its abundant natural resources and an aggressive policy on energy, Nicaragua could conceivably produce nine times more energy than it can consume—and all from low- or zero-carbon sources.
Milagro Verde: Luxury Green Living
A newly launched eco-community within Milagro del Mar Beach & Golf Resort—christened Milagro Verde—is bringing innovative sustainable design and construction down to a neighborhood level. The first homes are now underway, reflecting the “right-sized” concept that values efficiency in design rather than sheer size. This includes maximizing use of outdoor living spaces, which contributes to energy efficiency and takes full advantage of the community’s ideal setting on the Pacific Coast.
Patrick Hiebert, one of the resort’s principals who is heading the development of Milagro Verde, points out that “this carefully planned neighborhood of single-family homes demonstrates that sustainable living is a realistic, achievable and affordable concept that delivers efficiency without compromising quality of life.” In fact, Milagro Verde stresses the ability to live “green” without sacrificing luxury and comfort.
Combining Innovation and Tradition
Every aspect of home and site design is considered at Milagro Verde where the traditional Spanish Colonial look is combined with materials and construction solutions based on accepted sustainable practices. The homes feature local materials such as sustainable sugar cane ceilings and unique jungle hardwood floors that resist termites and rot. These floors also are more comfortable to walk on than tile and absorb moisture, thus making the home feel cooler.
Each home in Milagro Verde will utilize geothermal evaporative cooling, which uses the coolness of ground water (which is cycled back in the ground) for cooling the home and requires very little power to operate. Passive solar water heating uses extremely efficient microfiber panels that heat water and store it in a tank, requiring no power. An option is installation of a tiny solar-powered circulating pump that stores water in a regular water heater with its elements turned on only if necessary. Interestingly, the solar pump stops automatically when the sun sets and the panels are no longer generating energy. Gray water produced by general home uses is recycled and reused in toilets and irrigation. LED lighting and efficient appliances further lessens the home’s energy requirements.
On a more passive basis, homes are situated to take full advantage of exposures, roof angles are created for maximum solar power generation (though the panels are hidden from view), and ventilation is designed to maximize the flow of cooling ocean breezes through the open floor plans.
“We’re including a variety of green products and techniques at Milago Verde, and will continue to evaluate new technologies and approaches,” says Hiebert. “In addition to feeling good about living in a low-impact home, owners will enjoy the financial benefits of generating their own power and using substantially less water each month.”
Recent innovations and improvements have reduced the costs of products, materials and construction, making green living a more affordable and attainable objective. A home in Milagro Verde is projected to cost less to build and maintain, can be expected to retain a higher than average resale value, and will ensure a more earth-friendly, sustainable approach with a lower cost of living.
It’s an old line that seems to have taken a life of its own: “Nicaragua is the next Costa Rica.” Or sometimes it’s Panama or Ecuador or some other place that has experienced an economic boom, particularly related to real estate. The simple truth is that Nicaragua is a totally unique place with a culture, history, natural beauty and people that differentiate it from its Latin American neighbors. And, at this point, with many of those neighbors suffering from increasing crime, sluggish economies, political issues and, in several cases, inflated expectations from outside visitors, it is extremely important that Nicaragua make its case to the world that it is a vibrant, progressive, economically sound and secure place that is welcoming to visitors and outside investment.
That’s why it’s been refreshing to hear Tourism Minister Mario Salinas state publicly and bluntly that Nicaragua is not the “new Costa Rica,” and has no interest in such a comparison. “In lots of U.S. publications they talk about Nicaragua as the ‘New Costa Rica,’” Salinas said in a recent talk to the Nicaraguan-American Chamber of Commerce (AMCHAM). “But we don’t like that, because we think we have a diversity of offerings—a culture and a history—that Costa Rica never had.”
Tourism Continues to Climb in Nicaragua
The push for Salinas and his organization is to continue to increase tourism, which has been trending steadily upward over the last few years. Once lagging behind its neighbors as a destination for visitors, Nicaragua attracted more than one million tourists in 2011, which represented 13% of Central America’s tourism market. If the current growth continues as projected, the country will soon rank only behind Costa Rica and Panama.
Of course, anyone who has been involved in Nicaragua over the last decade knows that the prevailing source of the “next Costa Rica” description has been individuals and companies involved in real estate development. In this case, it’s important to note there is some very real truth to this contention as it related to buying real estate in Nicaragua.
Following a Proven Trend
Nicaragua lagged behind its neighbors for nearly three decades due to its internal strife. That’s no secret, but something that now is comfortably in the past with a stable, democratic government in place that appears committed to aggressive economic advancement and improved social conditions. For that reason, real estate development within Nicaragua, even on its ideal Pacific Coast, did not advance as it did in Costa Rica, which boomed beginning in the 1980s. Stories abound of individuals making an adventurous real estate investment and then watching prices jump substantially within a short period, as well as those who failed to act and then found themselves priced out of the market.
It Really Could Be the “Next Costa Rica”
For that reason, Nicaragua can legitimately be described as the “next Costa Rica,” but mainly in regards to the still low prices found within the country for real estate and the potential for similar healthy returns over time. There are many more options now to select from for vacationers and investors, with competitive prices. And, as Nicaragua is further revealed to the world, such investors appear poised to benefit from a willingness to participate in an emerging market.
In fact, International Living, which is recognized for its ability to spot trends, has stated in no uncertain terms about the future of Nicaragua’s Pacific Coast: “We believe this stretch of coastline is primed to explode onto the world stage, and that if history is any guide, real estate prices could skyrocket here as much as 500% in the next few years.”
The Future is Bright in Nicaragua
Obviously, there’s no guarantee that such sizable returns will materialize. But more and more observers and investors are becoming confident the future is bright in Nicaragua’s real estate market. Such positive signs as increasing tourism and burgeoning outside investment underscore the ripe possibilities here.
As Minister Salinas so aptly put it: “Now is the moment to distinguish ourselves among the multitude.”
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