Panama real estate downturn includes commercial properties

Panama’s real estate boom which included commercial stores and warehouses is over and the oversupply of houses and apartments is matched by commercial properties.

The proposal of president  Cortizo to increase the coverage of preferential interest for housing, currently under discussion in the  National Assembly, is a measure that seeks to re-ignite the sector. However,  says TVN there is also a considerable inventory of commercial premises, offices, and warehouses.

“We handled figures that ranged from between500,000  and 600,000 square meters. Remember that Panama is also a country that has been blessed by its geographical position, ”said Luis Pimentel, president of Acobir.

There are free zones whose occupation in previous years was 100%. Now, it only reaches 70%. Local rentals above $20 per square meter are not being rented.

“There is an oversupply of commercial premises at the moment because their construction began with a different economic situation from the one we are currently going through. The slowdown we see in Panama is also reflected in Latin America and the export destinations of our products, ” Aida Ureña De Maduro, a member of the Board of Directors of the Industrial Union of Panama told TVN

Entrepreneurs ask the government for incentives for foreign investment so that Multinational Company Headquarters are established in the country. They clarify that this requires that Panamanians are qualified to work in the companies.

the strategies of entrepreneurs is the adjustment of rents, moving to smaller spaces or commercial strategies such as converting shopping centers into outlets, with discounted products to encourage sales.

Although the impact is more marked in the capital city, they explain that the oversupply feels the same in the rest of the country.