Panama, Casco Antiguo
Casco Viejo, San Felipe
5 Lessons From Real Estate in
Europe
Ah! La Bella Roma! From the cradle of
Western civilization to a huge melting pot, for those who have visited or lived
in Rome it blows your mind away and steals a piece of your heart. But if you
actually want to own a piece of Rome, you’d better be prepared to give also
your kidney away (the good one), an eye and seriously consider adding up one of
your lungs to sweeten the deal. Wao. The incredible thing isn’t that prices are
astronomically high; it is that at over $20,000 US dollars per mt2 or $2,000 per
ft2 people are still buying.
Of course, it took over 2000 years for it to appreciate
to that level, so salivating speculators in Casco Viejo, Panama, need not apply. But still, if
you compound it all, what may seem crazy in today’s world is not buying a
historic apartment in an urban center. What I learned from my recent trip was
that human place value where life is most
enjoyable.
1.
Human Scale:
Never underestimate the power of a city that makes a
person feel like one; where you are an important element of a beautiful city,
not an afterthought behind your car.
Where you can walk both to get your groceries and to
have fun. Where having a car is almost a nuisance. Anyways, in today’s world of
raising oil prices and global warming having a car and using it on a daily is
almost prohibitive. Rome was bursting with people walking around or
riding bikes. Every historic city I’ve ever been to is a heavily pedestrian/
bike site. Creative solutions have been thought to fit them into the space and
be more efficient, but not all the way around. As size does matter, Rome is the land of the
Smart Car, the “Cinquecento” (or Topolino as Italians call it), and the mini
everything from public transportation to the garbage truck which can be operated
with only one person.
In yesterday’s world, it was just common sense. People
clustered together because it was efficient. In today’s world where time and
resources are money, it is a matter of survival.
2.
Mix = Authenticity = Excitement
=Vibrancy = Value
This package moves around together. There is no way to
get one without the others.
Rome is still in many ways the
center of the world. It is chaotic, irreverent, eclectic and fun. A thousand
voices speaking different languages, gothic kids in the sideways giving away
flyers for a concert, businessmen in their Italian suits and Ferragamo shoes
elbow to elbow with tourists and residents who are having a cappuccino at one of
the many sidewalk cafés or gelatterias. Laundry on the balconies, rainbow flags
on the windows.
To my surprise, most buildings looked like they haven’t
been painted in ages, and the ones that were didn’t have latex but lime based
paint. Nothing in Rome is or feels manicured. It looks and feels
like an unexplored city with mysteries to be solved at every corner. No matter
if it is by far the most visited city in Italy and probably Europe. People will visit and return countless times to
learn more, to explore another corner, to see what has changed.
Stores cater to a wide mix of clients. There is
something for everybody. High end along with cutting edge and artsy stuff. As a
result, it never gets boring. At night, the fun still goes on. College students
meeting in the plazas, romantic couples strolling. In the States, most people
would meet at the bar to have a drink. In Italy they meet
at the Gelateria to grab an icecream, wine or a café. No one really worries, as
you can always walk back home.
3.
It is where you live, and it shows.
Flipping through most real estate and lifestyle
magazines they tend to show minimalist spaces with slick designs that make
you wonder… where is the stuff? People live with a lot of stuff. Very few will
have antiseptic lives where your night bed table features only a thin design
lamp and nothing else. Mine has piles of stuff, books, change, my ipod, CD´s,
among many other things. Someone walking into my bedroom can clearly say like
the Goldilocks story: someone lives here. Cities are made of people. They must be a logic reflection.
So, if you ever step into a city that is so clean you
can eat on the floor of the main plaza, every building is covered in a latex
paint that reflects both the sun and your face, plus smells like plastic,
gardens are unnaturally trimmed, there are no dogs or cats to be found, loud
music shuts down at 9 p.m. and everybody looks just like you… wake up!
Every year, Disney spends a lot of money to make you
believe it is possible to have such a place and that you would be actually happy
there. Truth is, for those cities that have attempted and somehow succeeded in
making it happen, they are worldwide known as a) tourist traps or b) the most
boring places on Earth.
On the long run… which option holds more value? Probably
the option where humans can get excited about new things and enjoy the multiple
flavors coming his way. Because of the mix which brings the vibrancy, cities
like Rome can
look and be old, but keep hearts that are forever young and therefore relevant.
And as humans, we
instinctively value this.
4.
Green bucks chase Green
cities
There is something very human about wanting to live
where we can touch, see, smell, enjoy, nature. Parks, gardens and pets have been
the usual ways to incorporate this factor into urban settings and keep us
connected. There are volumes written about the benefits of green spaces within
cities. While some developers might see it as lost space, urbanists, majors and
more importantly residents, know there is no valuable city without them.
Historic cities are special because they where built
around green spaces making them the daily meeting point. And limited space
hasn’t been an obstacle for imagination and creativity: roof terraces, walls
and balconies have filled in with fantastic combinations of plants.
On historic cities there is a myth that everything has
to be regulated in order to keep it truthful to what it was. Façades are
carefully restored and not much visual objects are allowed. Rome, the ultimate
European historic city, proves quite the contrary.
There, balconies explode with plants, roof terraces have
huge trees growing on them and many façades are covered if not completely at
least partially with plants and vines. A refreshing twist: most of these
gardens, even the ones on the plazas are edible gardens. Urban agriculture is
huge, as the cost of food has increased tremendously. Every corner with some
soil and sun is used to plant herbs and vegetables, a healthy and cheaper choice
for today’s world.
5.
One of a kind.
Rome is unique. There is no other
like it and no one is building another brand new Rome. If they were, it would obviously be a
fake. Maybe Disney at some point will open a Rome pavilion with centurions dressed in
costumes. I’m sure the Italian filmmaking company CineCittá has many of its
buildings carved in foam. But at least on both examples the idea is to honestly
create a fantasy. For those developers who have tried to replicate the style it
has gone dead wrong and has ended up looking, feeling, smelling and therefore
being really tacky.
Historic cities can’t be replicated. And for those who
hold the advantage of being near thriving cosmopolitan cities with a mix
population, the combination for value is perfect. Scarcity and uniqueness are
the two key elements of value. On the long run, historic cities tend to
appreciate more than modern ones and to hold value better. It is the difference
between buying a Picasso or buying a full color poster of a Picasso painting.
Summarizing all this to what brings us here: Casco Viejo, Panama.
You can probably recognize several of these elements in
our beloved Casco Viejo. As an investment, it is still on an early cycle
compared to any of its peers (including Cartagena, which is the closest one). To give
you an idea, the best stuff in Cartagena is between $5,000 to $6,000 per mt2, almost double the price of Panama. The best
properties in Italy
(Rome) are over
the $20,000 per mt2. The worst apartments at the Italian rural south (literally
in the middle of nowhere and probably unrestored) are around $3,000 per mt2
which is the price for the best apartments in Casco Viejo, Panama, with views, amenities, parking, sometimes even with pool and elevator, a UNESCO protected site 5 minutes
away from a cosmopolitan urban center and 30 minutes away from an international airport considered one of the biggest hubs in the region, not to mention 10 minutes away from the domestic airport in case you want to spend a weekend at the San Blas white sanded beaches learning from the Kuna indians or if you feel like stretching your legs hiking the Baru Volcano at Chiriqui. All these flights are less than an hour.
Again, for pure investors with a taste for instant
flipping, here is a disclosure clause: appreciation is an organic process that
takes time. You want to maximize your profits? You need to get involved, inject
energy into the neighborhood and promote actively content that would add
texture. Come on! It is actually fun. No time for it? Consider donating. From
the Scouts to all the social programs of Fundacion Calicanto, from the music
festivals to opening your commercial space or your building to young artists in
need of space, there are tons of things you can do to increase the value on the
neighborhood and therefore your property that doesn’t require much.
If not for altruism, then just because it is good
business.