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06.05.2009 03:18:35
Dear Friends and Investors,
We here at BuyingCR would like to provide our clients and friends with the most updated information on near foreclosure sales and severely discounted farms etc. During these tough times throughout USA and European real estate markets it has provided us with foreign sellers that are distressed and selling at major discounts. Many have been sold over the last 60 days but many are still available. Here are a few examples of great deals to buy now to develop or resale 24-36 months from now for a hefty profit.
1) The first option here is a simple buy and flip option. The developers have to make some additional activity in the slow 2009 season so they have a few sites at majorly discounted prices. The infrastructure is completed and the titles are clean and clear. 1 site is 3.2 acres, amazing ocean views with a large building site fire selling at $65,000. And another site with a amazing ocean views and 4 acres at $75,000 including river frontage and virgin forest. These are home sites to buy cheap now and flip 36 months from now for double. http://www.buyingcr.com/listing-3-acres-with-amazing-ocean-view-114.html
2) Finca Lagarto Guanacaste is one right at the top of my list right now. The size is 44 Hectares (110 acres) and the farm sits exactly ½ mile from the beach with a altitude of 100-150 feet above sea level so views down the coast and sunsets are spectacular. The property has 800 meters of Public road frontage so segregations and Condo law are very easy. The farm sits just off the main paved highway from Tamarindo to Santa Cruz city, and the highway to the international airport 60 minutes by car. The new Barcelo Resort (Spanish hotel chain) to open in 2011 just 7 miles south of this farm in Playa Azul and the new JW Marriot is open and running just 10 miles north in Hacienda Pinilla. If feel that the location could not be better for a strong investment. The farm includes a topographical study every 3 feet, a permit to drill a well for the project and the water association on the mother farm to piggy back on and get all permits. Seller is distressed and is near losing his permits on the mother farm (1,300 + acres) next door. He needs cash to start roads and electric on the Phase 1 and 2 of his farm next door. He has dropped the price to $1,320,000 and it is a steal. I think if we can get a all cash deal together he will do even lower! This farm will sell fast at this price.
Options to develop this farm: Initial investment in the first 12 months: a) Buy property, Drill water Well or wells, Get concession on Well started and Asada approval, Take Topographical study to a preliminary master plan stage, Cut and gravel internal main roads and clean property thoroughly, Study best building sites and soil studies. At this stage we are 12- 14 months into the investment and can now either sell for 100% gain and or hold for additional time to gain a 200% return (this could take 36-60 months to gain 200% on holding). b) At the stage of 12 months investors will need to make the decision weather prepare to sell for double, hold for more by land banking or develop the farm into condo law. On a farm of this size with easy rolling hills any # of condos could be done but being very conservative at 85 Units the net profit can be over $20,000,000 if built and sold over a 3-5 year period. At this point the best option is build in phases to keep construction cost down and also keep risk down by building no more than 30 units at a time or so. To get the preliminary master plan approved for build out takes 12 months so the investors would now be 24 months into the investment and ready for approval to start building phase 1. That is where we get into construction costs etc if investors decide to develop. c) Mother farm is also available which is 1,365 acres in size and listed at $16 Million. This would be a 10-15 year project. This farm has public road frontage for over 3 miles and beachfront.
3) Finca San Raphael is my next favorite choice right now in Southern Pacific Costa Rica, located south of popular Playa Dominical and North of the Famous Osa Peninsula. This farm has views that top any in southern Costa Rica and a very interesting shape that makes it very private and secure. There is one main way in and out so it can be gated and guarded if needed for a development in the future. The farm is 83 Hectares (207 acres) in size and is a mix of Jungle around the building area and rolling grass hills where the development is to be built with Ocean views from any angle do to its peninsula shape. The farm is maintained full time right now by 2 full time workers and the seller has done a topographical study on the farm every 3 feet along the building areas. He has also sent a geologist to scan the farm and start the well drilling permits. That will help speed up his sale and also speed up the buyers down time. The farm cannot be closed in escrow until August so that is a big plus to have a chance to tie the farm up with a deposit and then do a long due diligence and have a chance for you to raise funds. Listing price of $2.54 Million. Not yet MLS listed!
Options to develop the farm: a) Complete wells, start a preliminary master plan for high density affordable condos, Start concession on the wells, maintain farm clean, chip in with neighbors to run electric and gravel up the road so the farm can be accessed easily. This will take 12 months. At this point we can sell the farm for a 50% gain or hold a additional 24-36 months as is for a 100%+ gain on land banking it. b) Our second option at the 12 month mark would be to fully approve the master plan and move forward on getting it ready to build. This will take a additional 12 months to get all approvals and construction permits ready. At this 24 month mark we could market it as a fully turn- key entitled farm ready to build and sell for a 100% gain or go the next step and start building in phases. The proforma I put together for this farm is again extremely conservative at 85 single family condo villas and profit net is right at the $20 Million mark over a 5 year design and build out.
4) My next favorite choice is a smaller track in Southern Costa Rica. It sits just back off the beach and ocean with views over the largest mangrove forest in Central America and has amazing views down the coast with year round sunsets. This farm is 10 Hectares (25 acres) listed at $450,000 and seller is fairly firm on price. This is set up perfectly for a hospitality project or small condo project 12 units or so. The farm is just south of the new golf course under construction and very close to the new lake project in the south.
Options to build: a) Property includes topographical study, water and electric to the property line. b) From there do soil studies, and start architectural designs, this would be a great spot for 10-12 high end residential villas or something similar. That will keep the land cost below $45,000 per unit and the sales of the units would be around the $395,000 price point. c) At this point being 18-24 months in the investment would be to master plan and flip. And or d) build out and sell in a 3-4 year additional build out for a 4-5 year total investment. e) Entire 170 acres is also available http://www.buyingcr.com/listing-finca-monte-vista-238.html
5) My next choice that came in recently is a 260 acre track just south of the city of San Isidro. This farm is 50% pasture land and 50% forest. The farm is listed at $575,000 ($2,211 a acre) and has amazing waterfalls and views over the city that would make this a good track to develop. In this area we get a mixed bag of Costa Rican and American clients to buy around this city and normally trying to get in at a cheaper price point then the ocean view inventory at the beach. San Isidro is the fastest growing city in Costa Rica right now and the buyers are mostly younger Costa Rican couples that are 35 years and younger so I feel this farms best use is: a) Segregate the farm in large estate size tracks say 2 Hectare (5 acres) segregations and put in just the basic infrastructure such as main road and electric and water system. The farm currently has hydro electric power system that runs from the waterfall to the farm house. The electric will need to be run down the main road and then internal through the farm. This would allow you to keep costs down and sales simple. The home sites would sell at $75,000 a piece and there would be 25 or so to sell. b) The second option is to make a large community of prefabricated homes and sell them on 1 acre lots and do them cheap like $125,000 house and lot combo type deals and do 100-125 of those units. The banks will finance the Costa Ricans up to 80% so we can have the bank lined up so you get paid in cash on the sales and the bank gives them 30 year loans with 20% down. Then the Ticos only need $25,000 down and it is a small monthly payment. These would sell over a 6 year design and build out time frame.
6) My sixth choice is a 324 hectare (800 acres) track of land in a town south of San Isidro called Buenas Aires . This town is now part of a major hydro electric project just started December 2008 and zoned to be completed in 2016. This 800 acre farm has a few miles of Pan-American highway frontage for commercial segregations and has a large public road the cuts the farm in half. Already running along this road is 3 phase electric, Telephone lines, Internet and City water. This keep development costs low. The farm is only for agricultural use right now and is not ready to develop yet. List price is $3,240,000. That is $1 per M2 or $4,000 a acre. The idea would be to get it at a discount on a strong deal. I am hoping for at least a 20% break in price on a strong deal. a) Best use of land is to lease the land to Copreeagri agricultural company for Sugar Cain and Dole and Del Monte for Pine apple production and generate income over the next 7-10 years while waiting for lake completion and preparing master plans. At this point being 7 years from purchase options are: b) Sell as a whole for or $2.50 a M2 or $10,000 a acre. c) Break into 100 acre pieces and try for $3.50 a M2 or $14,000 a acre with providing basic Public roads and Electric to each 100 acre track. d) Break into estate size parcels with minimum restrictions say 25 acre tracks and basic infrastructure to each and sell for $4-$4.50 a M2 or $16,000-$18,000 a acre. e) Break into 5 acre pieces and provide basic roads, electric, water and sell for $6 a M2 or $24,000 a Acre. f) This is not including the commercial segregations along the Pan- American highway.
7) My seventh selection is a 500 acre farm that is in near foreclosure just north of Jaco City on the main entrance off the Coastal highway from San Jose capitol. The farm has 300 meters of highway frontage and a perfect spot for a sales center. The farm has all the preliminary studies already done so it is pretty much entitled minus the final land movement approvals. Priced to move at $5,5 Million or $11,000 a acre. My only concern with this farm is that it would be a 12-24 month hold really until that lot sales market returns hot again so other than internal roads, Entrance feature and basic infrastructure would be all I recommend until at least the lot market heats up again and then you can finish using sales money. I am investigating if they have wells completed or concessions started but the farm lays out very nice and the ocean views are very nice over Jaco city and the Nicoya Gulf. The beach is a short 3 minute drive on the other side of the highway. This farm is really only for sell out as lots and a combo of homes and a small golf course or beach club/tennis club idea would be necessary to attract many buyers from San Jose. The main benefit to buying this farm now is that the Caldera highway is being built from San Jose to Orotina and it exits just north of this farm making it the closest beach area from the city. When the highway is completed (zoned for July 2010 completion) this farm will be a mere 45 minute drive from the capitol city of San Jose. http://www.buyingcr.com/listing-finca-valencia-121.html
Investment Options : a) Sell out home sites only and stick to the basic master plan minus a few changes. b) Sell out home sites in first 2 phases and continue with homes and villas of all sizes and prices in phases 3 on. c) Tennis club/pool and large park for kids etc to bring in many San Jose buyers. d) Possible lakes 2.5 acres-10 acres in size on a lower section instead of the golf course idea to make lake front home sites and lake view home sites on the sections with no ocean view. My only problem with a golf course right now is that permits are very difficult and pricy so with a beautiful green zone and park with pools/tennis/spa/bike paths etc and a lake idea would do the same thing in my opinion. They are close to the beach but you want the buyers happy inside the safe family community. Remember as Jaco city grows so does crime so San Jose Costa Rican’s will look to these projects as the safe family alternative. Pricing should affordable for our targeted buyers $50,000-$150,000 home sites. $299,000-$500,000 homes etc. Maybe even a section of homes for $199,000-$299,000 so they sell very easily to San Jose buyers looking for a second home at the beach.
8) On a much smaller note I had 2 very interesting ocean front home sites come in. Both guys are from Ocean City Maryland and had them listed at $395,000 and $375,000. I have them agreeing to $600,000 for both on a cash deal. The deals have to be closed separately but I have a verbal with both sellers as of now. These home sites sit exactly on the 200 meter title line and are as close to the ocean as possible with clean title in Southern Costa Rica. Actually Derek stayed in a home in this development and knows the views, amazing. This would be to simply build 2 high end homes but not too crazy in size maybe 2,500-3,000 square feet of internal building and another 1,000 square feet off outside decks and pool bars etc. These homes are building for 100 a square foot for interior space and $50 a square foot for exterior patio footage. The pool and landscaping can run another $60,000 and in total around $700,000-$725,000 for everything built and the land. These homes get $2,500 a week rental and will sell for over double as soon as they are finished. The idea here would be to rent as vacation rentals and produce income while also going to market around $1.8 Million to sell each. http://www.buyingcr.com/listing-dominical-beach-watch-216.html , http://www.buyingcr.com/listing-dominical-ocean-front-232.html
9) For my ninth choice on today’s list for best buys is a piece that is a mountain buy above Uvita with amazing ocean views called Finca De Osa. The only two options on this farm really are to clean up and flip or design and build a eco tourism resort/lodge. The farm has 2 pieces we would need to buy. One is a American owner from Orlando and desperate to sell. His land is 211 acres and I can get it for $325,000 on a cash deal, the second piece is a Tico farmer and it will take $50,000 or so to take him out of the picture. His piece is small about 1 acre but very important ridge. The farm can be bought without the second piece but in my opinion it is a important buy. The idea on this farm is to take a very raw property filled with jungle and design a hospitality idea and provide basic infrastructure to the farm. We have about 25 acres to design on the buildable areas, and then from there design the hiking trails along the jungle and rivers below to the water falls etc. We can hopefully make these trails accessible by ATV for easy showings and re-sale. Initial investment would be to buy both pieces do a basic cleaning on the road $3,000 or so, Scan farm for Well sites $3,000 and then this coming dry season drill the water well and bring electric to farm $50,000, bulk cleaning $6,000, a topographical study $3,000 and then a preliminary hotel design $20,000 with studies included. The total investment at the 12 month mark for investors will be $460,000 at this point we are ready to take the farm to market in December 2009 but will need to put a additional $40,000 into the main road working together with any neighbors and the city if possible but let’s expect a $500,000 investment in total. We are now ready to take the farm to market at a) $1.2 Million as sell to a hospitality buyer and or b) JV with a hotel flag and or c) build it yourself.
10) My final selection for the top 10 list is a 16 acre small private farm just 1 mile from Dominical beach and amazing views over the Dominicalito harbor and jungle. This property is called 'Reserva' because it is smack in the middle of a biological reserve that is filled with wildlife. This could fit a small project and or a hotel. It also is a great location for a vacation rental and is the most private home site in the Dominical! Seller has the farm listed at $495,000 and is willing to do a 20% discount for a cash buyer.
Investors, these are the Top 10 buys that are on the market at today’s date. I feel we are at a great point in Costa Rica to buy and get the farms to the next level while the government is moving forward with $2 Billion in infrastructure projects at the same time over the next 36 months. We will be in great shape coming out of this slow market in 2010/2011/2012 with first class products to sell. This is the time to buy!! Do not miss the boat again on owning a piece of heaven in Costa Rica!! Best Regards, Casey Please send us your questions and comments to better understand your investment needs and we are here to work for you, THE BUYER by providing the best property and price for your investment ideas!
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