Administrative Procedures -Necessary but not Exciting!

ISSUE #981: Feb. 25-March 2, 2024

2024-03-03

Brian Timmons, Newsletter Author
Brian Timmons

Dear friends,

When I started Residencias Los Jardines, I started writing a weekly newsletter -determined to tell all the good, bad, and the ugly. I knew some readers would be interested in the construction process. I expected others might be interested in the lifestyle of two people who had decided to live outside the box. For others, the adventures of Lita, the parrot and the cat took on an entertainment saga all its own.

Residencias Los Jardines is finished. We periodically have re-sales and rental availability. Some readers may be interested in this information.

Brian Timmons
Developer / Property manager
Residencias Los Jardines

Web: https://residenciaslosjardines.com
Emails: info@residenciaslosjardines.com
ResidenciasPropertyManagement@gmail.com

Market activity
sales & rentals

Sales: Los Jardines: a 3 mo. availability of unit #105

Rentals:
Los Jardines: Nothing available
Paradisus: Nothing available

Residencias Los Jardines
property management, rentals & re-sales

FOR SALE
Unit #116: $ 169,000 / See Unit

FOR RENT
Unit #105: $ 1,350 mo. / 3 mo. beginning March 15 / Two bedroom, one bathroom, detached, single level, furnished / See Unit

For sale

Total Area (Sq Ft): 1290
Total area (Sq M): 120
Bedrooms: 2
Bathrooms: 2
Floor(s): 1
Type: Semi-Attached
Furnished: Yes

This 1,290 sf single floor home includes a 300 sf front terrace plus parking for one car and a separate, secure storage locker. It is and end unit and therefore attached on only one side by a 6 inch cement demising (common) wall, which prevents sound transfer.

For rent
Our Lives

What Happened This Past Two Weeks

Weather: Our summer weather contiues as normal -the past two weeks have seen a lot of wind... it will probably begin to abate...

Stories

1. Administrative Procedures: Corporations / Condos each have to have an annual owners / shareholder meeting. We were able to hold ours earlier than in the past number of years because our accounting system is now responsive and because our office management system is timely. Calling a meeting involves proposing an agenda and providing supporting documentation, calling for any additional agenda items, publishing the final agenda, allowing time for the items to be discussed, holding a physical meeting, collecting the email ballots, proxy ballots, and those physically attending, recording the results and then publishing the minutes of the meeting. As secretary I get the job of all and have been doing this for years becasue no one else wants to do it and by default, I do it. Our meeting lasted about 30 min. Fortunately we had 53% representation so we were able to proceed on first role call... Unlike Paradisus, which after multiple efforts and a lot of work, was able to get 53% of the owners and now has a legally appointed administration. That drama is over but not the financial problems.

2. Banks: The government initiative to identify the source of the $1.5 billion unaccounted for money is beginning to trickle down to the retail level. I received a notice from BAC--I am sure all banks will be doing the same -saying that any individual or corporation receiving interest on loans has to be registered with SUGEF (government watchdog on behalf the the central bank) -and has to be deposited into a separate dedicated account. Each registration is $1,000 a year... and what does this buy you... the guarantee of continual hassle from the bank... many of my colleagues and no longer investing money in CR and advising others not to as well... I am at a decision point myself... I have started looking for options..maybe I will improve the quality of booze and food... who knows...

3. Argentina: The person who sends out my newsletter lives in Argentina... I met her around 2002 when we both rented at what is now Los Jardines. She and her husband were basically economic refugees at that time because of the chaos in Argentina... well, as she explains, they oved back a number of years ago and have experienced similar economic chaos since, including the current issues. I asked her to tell me what it was like for those living in Argentina... here is her first had account:

I have a reasonably good job (we have a couple of clients outside the country, the rest are local companies, not individuals), so I can still pay the bills... even when the political and economic situation here is the worst I have ever seen in my 46 years of living. The last big crisis was at the end of 2001... but we reached Costa Rica in Feb. 2002 and came back in 2004... so we didn't have to face it. In 2004 things were slowly stabilizing and improving for several years until, I could say, 2015.

As an example... see the image below... milk price in Dec 2023: $543... today is $1100... See the last column... that shows the variation compared to the same month of the previous year... almost 200%. That is happening with EVERYTHING: food, transportation, health care, energy...
Imagine my expression when I read your newsletters and see the news and your comments about the colon-dollar exchange rate. I might be wrong... but I remember the dollar being around 350 colones 20 years ago!!!!

News Items of the Week

Comments:

1. Pacific Port Caldera: This has been a problem in the making and known for at least 5 years... Like Limon, it probably will go through multiple iterations. However, it will probably be resolved sooner than Limon was because it is a private concession and I do not believe it is unionized.

2. Tourism: I have not been out of my immidiate area for months so personally, I am out of touch. However, talking with those who have traveled to Jaco, Arenal, planes, restaurants, etc... I am told there are lots and lots of foreigners... This article says the same thing... The people I speak with, residents of CR for some time... all say that hotel and food prices are really really expensive...

1. Consumers pay dearly for the collapse of the concession port in Caldera

The extra costs are transferred to the owner of the merchandise, who in turn transfers it to the cost of the product that reaches the consumer, increasing the cost of living in Costa Rica.

QCOSTARICA — The collapse of the Pacific port, Puerto Caldera, is no longer just the daily headache of importers and exporters, but for quite some time now it is the consumers who have been paying extra costs due to the expenses involved in the delays and congestion at the terminal.

Take number is the situation at the Puerto Caldera, where ships wait up to 10 days or more to get a dock to unload or load

The delays are mainly due to operational problems and the lack of action by the authorities in charge of supervising the concessionaire, is the opinion of experts in the matter, confirming that importing companies are passing on these logistics and transportation costs to the consumer.

80% of Puerto Caldera’s operations are imports. This is the port where basic necessities such as food products, raw materials -both for the food industry and the pharmaceutical industry -, grains (corn, wheat and barley), fertilizers, construction supplies -such as iron and steel- and vehicles, to name just a few, enter the country.

The Chamber of Exporters of Costa Rica (Cadexco) and the Chamber of Foreign Trade (Crecex) warned that in January, Puerto Caldera reached over 100% capacity when a 70% occupancy is optimal for an effective port operation.

For example, on Monday, six ships could be seen waiting in the Caldera Bay for one of the port’s docks to be available. Two ships occupied positions 2 and 3 of the port and in position 4 or the bulk dock, a grain crane intensively unloaded the grains directly into the trucks. Meanwhile, outside the port, at least 30 trailers were waiting for cargo, parked along the entire entrance to the port terminal.

The delays at the Caldera port occur due to several factors.

“The first is that the port cannot receive large ships due to the limited depth of its berths, so large ships coming from Asia must transfer at other ports such as Manzanillo (Mexico), or Balboa (Panama), to ships with smaller loads that can transport to Caldera,” said Roxana Sosa, coordinator of the logistics and customs commission of the Costa Rica Chamber of Commerce (CCCR).

This generates delays in the arrival of goods because a ship from Asia can carry between 2,500 and 5,000 containers; but, according to port area information, Caldera can only handle, on average, only 700 containers per week. This means that the rest of the load will be moved to Caldera between four and six weeks.

The second factor is that when a ship arrives at Caldera Bay, it often must wait up to ten days to be able to dock and unload or load.

Maritime consultant Vernor Murillo explained that all ships pay the Costa Rican Institute of Pacific Ports (Incop) a minimum “anchoring” rate of US$74.43 per hour from the moment they arrive in the bay.

In addition to that, by waiting in the bay, shipping companies incur costs that range between US$22,000 and US$25,000 per day of waiting, according to Murillo, who was director of the board of directors of the National Chamber of Shipowners and Steam Agents (NAVE).

However, Murillo clarified that large container shipping companies have commercial contracts for “docking windows”; that is, a reserved arrival day and time at a dock; and those that are really being mistreated with weeks of waiting are the ships that transport iron or vehicles, which do not have these windows and can only dock when a dock can accommodate them.

The third factor is when the container “hits dock”; that is when it docks and unloads.

Carlos Montenegro, executive director of the Chamber of Industries of Costa Rica (CICR), mentioned that before, the cargo went directly from the ship to the trucks and to the importer company; but since April 2022, the pre-stacking process began to be implemented to decongest, which was authorized by Incop.

Now the full container that has been unloaded is moved to the “pre-stacking” area, then to the temporary parking lots, and then to the importers or tax warehouses.

“All this logistics adds costs that have to be paid to the port operator, you have to pay the transporters, the temporary parking lots, the shipping companies and all of these are costs that companies have to see how to apply to the product,” Montenegro said.

According to Sosa, the shipping companies give the companies seven days free of container use — without charge — which begins counting from the time the ship docks and after that they charge them for the container rental, fees that can range from US$125 to US$3,000 for container rental, chassis (trailer) rental, and pre-stacker movements.

“All these costs, logically, as a company I have to include them as part of the logistics cost (…). I have to charge all that to the cost of the final product and the biggest concern is that this increases the cost of living for Costa Ricans,” Sosa denounced. For example, if a kilo of something costs ¢1,000 colones, the company increases it to ¢1,300 to compensate for the extra costs in logistics and transportation.

“Obviously all these cost overruns affect Costa Rica’s competitiveness,” emphasized Juan Carlos Alférez, operations manager of the Standard Fruit Company (Dole) in Costa Rica.

According to the experts cited in this report, the most urgent thing is palliative work, such as increasing the draft depth or expanding the dock.

“What is needed is to define which are the most urgent works, how much they cost and how they are going to be paid for,” said Montenegro.

Earlier this month, several chambers were called to a meeting by the president of Incop and a committee was formed that will present short, medium and long-term approaches.

Two actions that are being analyzed are expanding the entrance to the port and enabling the land of the Ministerio de Obras Publicas y Transportes (MOPT) adjacent to the port area, to be able to move containers.

That meeting was followed up a week later in Golfito, where, as a palliative solution, certain loads can move through that terminal, for example, vehicles.

The Golfito terminal, operated by the Incop, is located some 300 kilometers (a six hour drive) from San José.

2. Costa Rica saw a big jump in visitors from North America and Europe in January

QCOSTARICA — Costa Rica experienced a significant increase in international tourist arrivals by air, with notable growth from North America and Europe.

In January the country received a total of 270,712 tourists by air.

From the United States, the main market, a total of 149,770 tourists arrived, representing an increase of 17.6% compared to January 2023.

Likewise, Canada contributed 43,112 visitors, an increase of 9.9% compared to the same period of the previous year.

Mexico also played a key role, recording an increase of 22.1%, with 5,731 tourists arriving by air compared to January 2023.

Some specific countries stand out: a total of 9,909 tourists arrived from France, showing an increase of 12.8%, while the United Kingdom and Germany recorded increases of 6.7% and 9.5%, respectively.

Tourist arrivals by air January 2015 to 2024

Last month, Air France announced the expansion its operations to Costa Rica with the arrival of more flights until the end of March and between June and the beginning of September 2024, thus consolidating the country, as one of the preferred destinations for its clients.

The Juan Santamaría International Airport (San Jose Airport - SJO) received 62% of total arrivals in January, with 168,839 tourists, representing a growth of 8.5% compared to the same month of the previous year. On the other hand, Daniel Oduber International Airport (Guanacaste Airport – LIR) received the remaining 38%, with 101,806 travelers, experiencing a staggering growth of 20.1%

These figures confirm an outstanding high tourist season, with increases in eight of the main markets, including the United States, Canada, Mexico, France and other European countries, highlighted the Minister of Tourism.

Continuing in its efforts of attracting new markets with high potential to promote the arrival of more tourists to the country, the Instituto Costarricense de Turismo (ICT) -Costa Rica’s tourism board- participated, together with ten national tourism companies, in the 43rd edition of the Tourism Showcase of the Colombian Association of Travel and Tourism Agencies (ANATO) that took place from February 28 to March 1.

“Colombia is one of the emerging markets in which the ICT will enter this year with the strategic vision of attracting tourists eager to live the Pura Vida experience, connect with nature, discover natural beauties, our culture, gastronomy and traditions; we will take advantage the proximity and air connectivity between both destinations, which make Costa Rica an attractive option for Colombians,” highlighted Minister Rodríguez.

Colombia is the main source market for travelers to Costa Rica from South America. Last year, 28,463 Colombians visited us by air, followed by Argentina with 23,718, and Brazil with 19,788 tourists.

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