Increment in Commercial and Residential Rentals

Manuel Luna - La Estrella January 30, 2007

The real estate sector registered an important grow during last year, by about 20%. But commercial and residential rentals increased as well.

The president of the Panamanian Association of Real Estate Brokers and Developers ( ACOBIR ), Ivan Carlucci, pointed out that commercial rentals increased 15%, while residential rentals increased 10%.

However, he mentioned that prices have increased between 20 to 25% when compared to five years ago, but there has been certain stability in the last two years.

Carlucci said that rental prices are expected to keep steady for 2007, especially in the commercial region where there is great competition and even future plans for new malls. Prices have changed a lot since 2000 to the current date and added that anyone who invests in rental projects will receive an annul revenue of at least 1%.

Approximated costs

Commercial rentals vary according to the location and it’s not the same to rent a place in Avenida Central, Via España or in Malls such as Albrook Mall. According to Acobir’s figures, a commercial place in Avenida Central is rented between 10 to 12 dollars per m2, a number that increases between 15 to 20 dollars in Via España. While in Albrook Mall the cost is approximately 30 dollars.

He mentioned that there will be an aggressive commercialization politic in 2007 by Malls, which will keep the prices stable.

Investments in residential constructions registered an increment of 12% during last year, mainly in the districts of Panama, San Miguelito, David and Colon. The demand for materials such as premixed cement and concrete registered an increment as well.

Carlucci also pointed out that Malls such as Multiplaza will need to improve its offer, and it is expected that the real estate sector will continue to grow for the present year.

Last year featured a great amount of building constructions in Panama City, mainly focused on foreigners wanting to establish a second residency in the country.

The real estate sector in Panama is at its peak and the sales and rentals of apartments, houses and commercial places is expected to increase in the next five years in Panama City and in the interior of the Republic as well.