The Costa Rican Real Estate market is one strongest, sophisticated and developed markets in the Latin America. The hottest region of the country is Guanacaste Province; an indication of this phenomenon is manifested through the influx of international capital, exemplified by big foreign investments from word-class players in the last year, such as Waldorf Astoria, The Ritz-Carlton and Discovery Land Company. All three lading in Guanacaste Province at this moment.
This trend is notable without even mentioning the thousands of sales in the retail market, hundreds of new real estate developments, and the thousands of new constructions currently underway in Guanacaste.
This real estate boom, established decades ago, has now become a solid, safe and profitable market for domestic and foreign investors. Simultaneously, it has become more sophisticated and reinvented in creating products to satisfy the needs of potential clients. One of these needs is the sense of community that the potential buyers are looking for.
The first product is the properties within a Condominium. This type of complex is well-known in the United States of America, Canada and Europe. According to the Costa Rican regulations, the individual sub-properties are fully titled and can be owned by a national, resident or foreigner without any restrictions. The complex is governed by the specific By-Laws duly recorded at the National Registry, the highest authority being the Home Owners Association, which is comprised by all the owners. On the other hand, the day-to-day administration can be coordinated by a board appointed by the Home Owners Association for a certain period of time, or by a specialized third-party company or person, also appointed by the Home Owners Association under the same conditions.
The second type of product is the agricultural subdivisions, consisting of independent properties of five thousand square meters (5,000 m2) or more, fully titled. As suggested by their name this type of properties were originally intended for agribusiness operation. However, over the time, the real estate developers have seen an opportunity, to structure housing complexes on a mountain with stunning ocean views and a lot of privacy for each homeowner due to the lot measurement.
In the practice, this type of pseudo-residential complex includes some kind of Covenant, Conditions & Restrictions (CC&Rs) through terms and conditions recorded on each property title, known “easements”, and its usually managed by a board of directors.
The third type of real estate development is inspired in the corporate structure. In this case, a company that owns an apartment building is structured through common and preferred shares, according to the corporate regulations applicable in Costa Rica, the preferred shares give specific rights to the shareholders, thus the rights over each complex unit are limited and assigned by the preferred shares.
Similar to the second type of development, the ownership through shares includes some kind of Covenant, Conditions & Restrictions (CC&Rs) through terms and conditions incorporated to the main company (holding company) by an operating agreement, and it’s managed by the company’s board of directors. The supreme organ is the Shareholders’ Assembly, compound by all the shareholders.
At Cubillo Legal we have extensive experience leading and negotiating processes of purchase and sale of properties or units in these different types of gated communities, as well as being the main attorneys for real estate developers, structuring and designing condominiums, agricultural subdivisions for housing purposes and real estate holdings through a corporate structure.
In the same vein, Cubillo Legal has advised all types of gated communities on their daily operation and the required compliance with the applicable regulations, as well as individual owners within the communities. We are a real estate full-service boutique Law Firm; Real Estate is our passion.
Andrés Cubillo
Managing Attorney
Cubillo Legal
