End of Year Review and glimpse of the future
It is hard to believe 9 months has elapsed since Casa Tortuga management arrived in Nicaragua having secured investment funding and finalised the set-up of the Dutch B.V holding company. 2006 has held for us a variety of highs and lows. In the main, the highs came from discovering potential lands that we each believed were appropriate for the location of the project while the lows came from either having those properties sold from under our nose or learning that the title was too risky to entertain purchasing. While we acknowledge the process of buying land in Nicaragua has taken longer than originally anticipated, there are a number of benefits to be mentioned as a consequence of the delay. Possibly the most important of these is the change in location strategy.
As you know, it was the original intention to position the project somewhere along the Pacific coastline. After failing to secure a property in the first few months of searching we started to entertain the possibility of locating the business elsewhere. The proximity to the coast and existing reputation had already alerted us to Ometepe´s potential as a tourism hot-spot.
Discovering Ometepe can be compared to a person finding their ‘home’. A person knows they are ‘home’ when they feel an indescribable connection and sense of inner peace and contentment. This is how it was with us and Isla de Ometepe. The more we got to know the island, the more we realised how custom-made this location was for our project. Its eco-ness, unique beauty, existing but yet un-tapped tourism and not to mention affordable land prices essentially screamed to us to turn away from the coast and look to the island for our future. We heeded its call.
Again months of searching for the right island property ensued. Initially, we embraced the strategy of buying lake-front property but research into tourist behaviour soon replaced this with our current and final strategy to locate the project in an elevated position on the side of the dormant Maderas Volcano where the trees are enormous and varied, the views breath-taking and the breezes cool and refreshing. It was thus in August that we came across the Alfonso Valle Castillo property which in a fairy-tale manner met all of our criteria.
So it has been for the last 4 months we have pursued the same 8.8 manzana plot. Over this circa 17 week period we have edged ever closer to securing our dream property in a manner that can only be described as two steps forward, one step back. Now on the verge of completing this historical deal our expectations are high and our enthusiasm restored to maximum power.
Even at the best of times, buying land in Nicaragua is not for the faint hearted. On a daily basis one’s patience and commitment is tested. Add to this the complication of buying from a Cooperative in a location (i.e. the island) where no prior land sale from a cooperative has resulted in the buyer achieving 100% legal ownership of their purchase and we have the recipe for a real head-ache.
Buying from Cooperatives has its benefits and disadvantages. On the up side, prices are generally far cheaper than buying from private owners or real estate agents. On the negative side, however, each step of the purchasing process needs to be checked, re-checked and, just for good measure, checked again. It is not that Cooperatives are inherently dodgy; in fact, most tend to comprise hard-working and honest farmers. The difficulties tend more to be a consequence of Nicaragua’s bureaucracy and the reality that Cooperative members generally fail to recognise the importance of attaining legal documentation until that time it is absolutely essential – either this or they simply can’t afford them.
As a consequence of how they received their land during the Sandinista Land Reform period of the 80’s, there can be other difficulties associated with buying from Cooperatives. In our case, however, we have been fortunate – at least this time round. The Alfonso Valle Castillo Cooperative is indisputably the legal owner of the land we wish to buy in the sense that the title is free of any external claims by third parties. Over and above this, the AVC Cooperative is essentially a small family cooperative who not only possess a similar philosophy to our own but also intrinsically recognise the importance of our project for them and the community. As such, they are 101% committed to making the deal happen and have proven this to us via their pro-activity and reliability.
Thus it is that we now find ourselves waiting for the issuance of the last two documents from the Ministry of Labour. This, under normal circumstances, would not present too many complications. We have been warned of likely delays however, due to the recent Nicaraguan Presidential elections. Due to the inevitable shuffling of departmental heads and a reorganisation of the departments handling cooperative land legalization, it is unclear how long we might have to wait to secure these missing documents.
Prior to the elections there was a lot of speculation surrounding the impact a Sandinista victory would have on the Nicaraguan economy, especially from the perspective of foreign investment. In his first few days as President Elect, however, Ortega has chosen to adopt a pro-active approach. In his first key meeting with representatives of the foreign investment community in Managua Ortega stressed his commitment to foreign investment, recognizing it as one of the keys to continued growth and future prosperity for the country. He made clear his intention to support the DR-CAFTA and stated publicly that property rights would be protected. He has continued the momentum with meetings with COSEP (the Nicaraguan Chamber of Commerce) and key members of the banking and finance community. If we are to judge Ortega by his actions and not his rhetoric then so far he has been doing, as well as saying, the right things.
On a global level, the geopolitical scenery has changed significantly since the Sandinistas were last in power and this is well understood by the Sandinista leadership. Secondly, on a more local level, the current Sandinista party is very different to the Sandinista party of old. The members, by their own admission, have matured and mellowed. Many of them have substantial financial and business interests in the country and so have a very personal stake in the future economic success of Nicaragua.
It should also be noted that having Sandinistas in government is not something new. Sandinistas have been very involved in the governance of the country at all levels over the last 16 years. Another factor to note is that although Ortega has won the Presidential seat, he has not secured a controlling number of seats in the National Assembly – the Liberal and Conservative parties (ALN and PLC) have a larger representation. This is an important factor in the new political landscape as the Assembly is equivalent to the US Congress and is the body responsible for passing laws, altering rules and establishing task groups. This will mean that there will need to be debate and discussion on key issues and the parties will need to work co-operatively in order to move the country forward with no one political party having a clear advantage in voting processes.
If we look toward the long term, the Sandinista victory may well emerge as a positive factor in Nicaragua’s history, sweeping away once and for all the old concerns rooted in memories of the revolution that have hung over the country for over 15 years.
As you know, it was the original intention to position the project somewhere along the Pacific coastline. After failing to secure a property in the first few months of searching we started to entertain the possibility of locating the business elsewhere. The proximity to the coast and existing reputation had already alerted us to Ometepe´s potential as a tourism hot-spot.
Discovering Ometepe can be compared to a person finding their ‘home’. A person knows they are ‘home’ when they feel an indescribable connection and sense of inner peace and contentment. This is how it was with us and Isla de Ometepe. The more we got to know the island, the more we realised how custom-made this location was for our project. Its eco-ness, unique beauty, existing but yet un-tapped tourism and not to mention affordable land prices essentially screamed to us to turn away from the coast and look to the island for our future. We heeded its call.
Again months of searching for the right island property ensued. Initially, we embraced the strategy of buying lake-front property but research into tourist behaviour soon replaced this with our current and final strategy to locate the project in an elevated position on the side of the dormant Maderas Volcano where the trees are enormous and varied, the views breath-taking and the breezes cool and refreshing. It was thus in August that we came across the Alfonso Valle Castillo property which in a fairy-tale manner met all of our criteria.
So it has been for the last 4 months we have pursued the same 8.8 manzana plot. Over this circa 17 week period we have edged ever closer to securing our dream property in a manner that can only be described as two steps forward, one step back. Now on the verge of completing this historical deal our expectations are high and our enthusiasm restored to maximum power.
Even at the best of times, buying land in Nicaragua is not for the faint hearted. On a daily basis one’s patience and commitment is tested. Add to this the complication of buying from a Cooperative in a location (i.e. the island) where no prior land sale from a cooperative has resulted in the buyer achieving 100% legal ownership of their purchase and we have the recipe for a real head-ache.
Buying from Cooperatives has its benefits and disadvantages. On the up side, prices are generally far cheaper than buying from private owners or real estate agents. On the negative side, however, each step of the purchasing process needs to be checked, re-checked and, just for good measure, checked again. It is not that Cooperatives are inherently dodgy; in fact, most tend to comprise hard-working and honest farmers. The difficulties tend more to be a consequence of Nicaragua’s bureaucracy and the reality that Cooperative members generally fail to recognise the importance of attaining legal documentation until that time it is absolutely essential – either this or they simply can’t afford them.
As a consequence of how they received their land during the Sandinista Land Reform period of the 80’s, there can be other difficulties associated with buying from Cooperatives. In our case, however, we have been fortunate – at least this time round. The Alfonso Valle Castillo Cooperative is indisputably the legal owner of the land we wish to buy in the sense that the title is free of any external claims by third parties. Over and above this, the AVC Cooperative is essentially a small family cooperative who not only possess a similar philosophy to our own but also intrinsically recognise the importance of our project for them and the community. As such, they are 101% committed to making the deal happen and have proven this to us via their pro-activity and reliability.
Thus it is that we now find ourselves waiting for the issuance of the last two documents from the Ministry of Labour. This, under normal circumstances, would not present too many complications. We have been warned of likely delays however, due to the recent Nicaraguan Presidential elections. Due to the inevitable shuffling of departmental heads and a reorganisation of the departments handling cooperative land legalization, it is unclear how long we might have to wait to secure these missing documents.
Prior to the elections there was a lot of speculation surrounding the impact a Sandinista victory would have on the Nicaraguan economy, especially from the perspective of foreign investment. In his first few days as President Elect, however, Ortega has chosen to adopt a pro-active approach. In his first key meeting with representatives of the foreign investment community in Managua Ortega stressed his commitment to foreign investment, recognizing it as one of the keys to continued growth and future prosperity for the country. He made clear his intention to support the DR-CAFTA and stated publicly that property rights would be protected. He has continued the momentum with meetings with COSEP (the Nicaraguan Chamber of Commerce) and key members of the banking and finance community. If we are to judge Ortega by his actions and not his rhetoric then so far he has been doing, as well as saying, the right things.
On a global level, the geopolitical scenery has changed significantly since the Sandinistas were last in power and this is well understood by the Sandinista leadership. Secondly, on a more local level, the current Sandinista party is very different to the Sandinista party of old. The members, by their own admission, have matured and mellowed. Many of them have substantial financial and business interests in the country and so have a very personal stake in the future economic success of Nicaragua.
It should also be noted that having Sandinistas in government is not something new. Sandinistas have been very involved in the governance of the country at all levels over the last 16 years. Another factor to note is that although Ortega has won the Presidential seat, he has not secured a controlling number of seats in the National Assembly – the Liberal and Conservative parties (ALN and PLC) have a larger representation. This is an important factor in the new political landscape as the Assembly is equivalent to the US Congress and is the body responsible for passing laws, altering rules and establishing task groups. This will mean that there will need to be debate and discussion on key issues and the parties will need to work co-operatively in order to move the country forward with no one political party having a clear advantage in voting processes.
If we look toward the long term, the Sandinista victory may well emerge as a positive factor in Nicaragua’s history, sweeping away once and for all the old concerns rooted in memories of the revolution that have hung over the country for over 15 years.
posted by Totoco Management at 4:37 PM
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