As the long, long season of COVID-19 wanes, everyone worldwide seems ready to get back to traveling. Booking sites can’t take reservations fast enough, wedding venues and caterers are booked months out, family celebrations are hastily being planned, sporting, arts, and musical events are back and Panama, it seems, is at the top of many travelers’ wish lists. There are a lot of reasons for that!
With white-sand beaches, world-class resorts, year-round warm weather, surfing curls fit for international competition, high-end sophisticated shopping, unmatched environmental activities, scuba diving and snorkeling in crystal blue Caribbean waters, the Smithsonian Tropical Research Institute, the Frank Gehry designed Biomuseo, the 1,550-foot volcano hikes of Baru, multi-species of birds (more than all of Canada and the United States combined), native flora and fauna, more deep-sea fishing records made than any other place on the planet and that little engineering feat called the Panama Canal, keeps Panama unique and exciting.
Only recently has Panama begun to capitalize and focus on tourism. Unlike neighboring Costa Rica, Panama has been more interested in keeping the nation’s Gross Domestic Product (GDP) less dependent on one industry. The services sector including banking, insurance, flagship registry, container ports, and product distribution contribute almost 70% to the GDP, while agricultural products such as bananas, coffee, shrimp, and sugar have slowed to under 10%. The carrying capacity of the Panama Canal was doubled in 2016 and consistently contributes directly over 12% and indirectly, through the other sectors, up to 40%. One of the world’s largest copper mines, located about two hours outside Panama City, is expected to eventually contribute as much as 21% further diluting the dependency on any one sector. Tourism has remained steady at just under 8% but that is changing.
Two New Cruise Ports
Major projects such as the new Panama Convention Center, the new dual cruise ports on the Amador Causeway, and Central America’s only subway are only three of the many attractive features Panama offers tourists. Copa Airlines recently introduced a program called “Stopover in Panama” allowing for travelers to visit two tourist destinations at no additional cost.
The Panama Convention Center will introduce many first-time visitors to Panama. The largest exposition hall in Latin America, officially opened in September 2021 with 166,000 square feet of space and already has 14 large upcoming conventions scheduled with 50 more being vetted. This week it is welcoming members of the highly influential Florida and Caribbean Cruise Association (FCCA). In addition, Delta Airlines announced on October 15th they would be increasing passenger capacity to Panama City by 80% when they add additional direct flights from New York-JFK, Los Angeles, Orlando, and Atlanta.
Travelers Want Different
The pandemic changed many things but one of the most profound has been the way people work and travel. Now that so many are technically “WFHing” or working from home, the definition of home has blurred. Where can home be? A beautiful beach, a long-term rental where children pick up an additional language, or maybe a new destination full of possibilities?
According to Airbnb, the San Francisco-based company with four million Hosts who have welcomed more than one billion guests since their inception in 2007, “travel is undergoing a fundamental change”. Seniors no longer look at “renting off the grid” as something questionable but something to be sought. Whole-house rentals are rapidly replacing the cookie-cutter, “what city am I in” hotel room with little more than a bed and a bath. Today’s traveler wants more.
Panama Has More
Many condominiums units in Panama have been perfectly developed to accommodate the tsunami of travelers that investment and portfolio diversification goals are seeking. From the ocean-facing beach units to those near schools and multinational businesses to luxury hybrids that embrace both, the options are amazing.
Ever since owners took possession of the first units at Royal Palm, with direct Pacific Ocean access, renters have found a welcoming whole unit experience at amazing prices. Investors can capitalize on under $200,000 smaller units to larger ones offering family experiences. With tax abatements and low financing, return on investment can certainly look attractive.
Buildings that have enjoyed occupancy for longer such as Parkside in Costa del Este provide investors with immediate access to the influx of new visitors to Panama. Arcadia, a soaring residential tower is now under rapid construction, capitalizing on government incentives. More and more multi-national companies are locating in Panama and specifically Costa del Este. There are always those employees looking for an attractive long-term rental option.
Luxury condominiums in the Casa Bonita residences share amenities with the five-star Westin Hotel, located steps away and provide a whole-unit experience with full kitchens and views of the ships queuing up for transit through the Panama Canal. For those looking for higher-end options, there are million-dollar residences available such as Matisse with maids’ quarters, private elevators, and sweeping views of Panama Bay.
Tourism Important To the Current Administration
Tourism was one of the major political planks of Laurentino “Nito” Cortizo’s promised administration. He ran for president and won, empowered from 2020 to 2025 as the country’s administrative leader. He has been focusing on the emerging audiences of the “extreme traveler” and the environmentally focused. A $6 million award to develop commercials and media for these audiences was recently given to a local agency.
Cortizo’s administration is also teaching North Americans that Panama is a small country, about the physical size of South Carolina, and how there is a wide variety of options to satisfy most tourists, sometimes within the same week’s vacation. This would cover sport fishermen with trailing children, honeymooners, glampers, cruisers, and those seeking a spa, umbrella drink getaway.
During the first part of the pandemic, locals were offered job training in tourism–everything from food preparation to leading “green” tours. Tax Abatements are now being offered at 100% for advertising so that anything directly paid to promote Panama tourism, including resort packages, building new boutique hotels, or investing in Airbnb-styled units aimed at the “new” traveler is repaid in tax reduction. If you can’t deduct it all, you can sell your balance to someone who can.
As part of promoting Panama, the FCCA Convention will include sessions covering Panamanian products such as lobster pulled from the waters of the Bocas del Toro coast to the world’s finest coffees and chocolates. Convention-goers, as well as cruisers, want to find the best local accommodation options at the most attractive price. Consider a revenue stream for a group of Airbnb whole units marketed directly to these audiences.
Drop Me A Line; Say Hi
I would love to chat with you about some of the amazing offerings we have available including properties designed specifically for tourism development. Included in the offering is excellent developer financing. Visit my website at https://www.lizlarroquette.com/ for contact information as well as project details.
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