Home All-Stars: Great Distances

Joan Tapper

01/01/2006

Ever since the wide world downsized to a global village, it has been common for investors to look beyond national boundaries for second homes. And few can resist the enticements of some of the world’s most popular foreign locales: historic properties in France, dramatic ocean-view villas in Mexico and pristine vistas in places such as New Zealand and Patagonia.

Beyond aesthetic advantages, factors contributing to the popularity of buying offshore include the relative strength of national currencies, the feeling of having genuinely escaped your daily life and even the cachet of having celebrity neighbors. As the famous real estate mantra goes, “It’s all about location, location, location,” but in a market the size of the world, that allows for plenty of choices.

Australia
Think of australia, and sydney’s magnificent harbor may come to mind. It is no surprise that a national love of the water impacts the luxury real estate market here. For foreign homebuyers, says James Dack of McGrath Estate Agents, “the hottest areas are in prime locations along the eastern seaboard of New South Wales and Queensland.” With major cities like Sydney and Cairns close by, investors can savor the seascapes as well as what Dack calls a “relaxed yet cosmopolitan lifestyle.”

In his list of highly desirable areas among foreign buyers, Dack includes Sydney’s Bondi and Tamarama beaches, East Circular Quay, Point Piper, Darling Point, the redeveloped dockyards at Woolloomooloo Bay (Russell Crowe recently paid more than $14 million for a luxury apartment there) and Palm Beach, an hour north of Sydney on a Malibu-like peninsula.

Outside Cairns–which boasts an international airport and the spectacular Great Barrier Reef–are the rapidly growing towns of Noosa, Port Douglas and Airlie Beach.

Most buyers are interested in gated luxury apartments with concierge service (“the term condominium is not used here,” says Dack) that require little maintenance. Waterfront units range from A$1.5 million to A$20 million ($1.155 million to $15.4 million). And even though the Australian dollar has gained strength against many currencies, the exchange rate still favors the United States, England and Singapore, the home countries of most foreign buyers.

Dack pinpoints Manly Beach, just 12 minutes from Sydney by Jetcat, as the next trendy market: “With an eclectic mix of harbor and ocean beaches and a vibrant restaurant, bar and café scene, it’s the gateway to the picturesque and secluded northern beaches.”France
Despite france’s natural and architectural beauty, the percentage of foreigners buying estates or apartments there is still small–but on the rise. “Here, 99.7 percent of real estate is owned by the French,” says Lionel Macaire of Belles Demeures de France. But there is little mystery, he adds, as to which parts of the country are the most at­tractive to outsiders.

A 16-bedroom chateau in the heart of France’s Rhone Valley combines 18th-century design with 21st-century amenities. (Click images to enlarge)

An almost-mandatory annual stop for those on the international social circuit, the South of France–Cannes, Nice, Saint-Tropez and neighboring beach towns–will always be a popular area with buyers. Realtor Filoména Di Domenico of Anciennes Demeures in Montpellier says that many foreign customers are heading to the Languedoc Roussillon area’s departments of Gard, Aude and Herault for beautiful landscapes as well as castles, residences and farms that are full of history.

The value of luxury properties in the South of France has risen recently, with prices doubling over the last five years to an average of $1.3 million. In Paris, where people buy apartments rather than estates, the cost is about h1,000 ($1,220) per square foot, according to Macaire–and is increasing about 15 percent a year.

Those buying in Paris are snapping up properties in the sixth, seventh and eighth arrondissements on the Left Bank (where the museums are) and around L’Étoile along the Champs Élysées, according to Macaire. “Those districts are Old Paris,” he says, and adds that “west of Paris is the next most popular area; there are old private luxury estates within 30 miles. Farther west, around Deauville, are stud farms for racehorses; near Orléans and Tours the draw is the Renaissance castles of the Loire Valley; and you have Bordeaux because of the wine.”

For those concerned about the strength of the euro, Macaire claims you still receive high value for your money. “A 250-hectare (617.5-acre) property with an 18th-century castle, just an hour out of Paris, is being offered for k1.3 million ($1.586 million). You can’t buy a New York penthouse for that.”

Mexico

The 20,000-square-foot Villa Estrella Mar ($7.2 million) near Puerto Vallarta. Photograph by Dave Marlowe, Courtesy of Webster Enterprises, Santa Fe, New Mexico. (Click image to enlarge).

The appeal of mexico includes a richly varied culture and the ad­van­tage of being close to the States. “[Puerto Vallarta is] no longer the sleepy town where Night of the Iguana was filmed,” says Chris Webster of Webster Enterprises, which currently represents properties ranging from $1.8 million to $7.2 million in the region. “There’s a big international airport, and Puerto Vallarta–the best of all the coastal environments and the gateway to the area–has expanded by 100 miles. To the north, Punta de Mita is setting the world on fire. It ap­peals to those who want the best amenities and new, fine materials.”

“The development of Puerto Vallarta, Punta de Mita and the Nayarit coast is a special phenomenon for ­Mexico,” notes Alexis Burwell of La Punta Realty. The number of occupants is restricted, and the low density preserves the environment and creates “balance that is essential for the high-end coastal lifestyle that people dream about,” he says.South of Puerto Vallarta, Webster says, “along the Costa Alegre, you have other bastions of wealth, exclusivity and fantasy fulfillment: Las Alamandas, Costa Careyes, El Tamarindo and eventually Isla Navidad.”

The patio of a home in Guanajuato. Photograph by Ricardo Vidargas, Courtesy of Webster Enterprises. (Click image to enlarge)

The Mexican government has recently changed some of its real estate legislation, making it easier for foreigners to buy and develop land. Benefiting tremendously from these relaxed mandates is Los Cabos corridor, on the Baja Peninsula. “It has experienced phenomenal growth in the last 10 to 20 years; some prices have doubled over the last three years,” says Webster. In addition, development is now spreading north to the capital city of La Paz, where ambitious luxury communities like Paraiso del Mar and Marina CostaBaja are taking shape.

If you can tear yourself away from the beach, look to hacienda-rich San Miguel de Allende, notes Webster. “It has a colonial atmosphere and beautiful countryside,” he says, “and from Houston or Dallas you can fly there in about two hours door to door.”

New Zealand
Yes, new zealand has always seemed far away, but suddenly that is part of its appeal. “Internet, cheap air travel, terrorism and an aging population have all increased demand for remote bolt holes in the Southern Hemisphere,” says Geoffrey McRae of Bayleys Real Estate. Throughout the verdant country, the costs of coastal and “lifestyle” properties have risen phenomenally over the past few years–especially  properties near cities that boast spectacular views or rural characteristics.

A private tennis court on Waiheke Island near Auckland. Photograph by Cliff Shaeffer. (Click image to enlarge)

Waterfront properties outsell everything else. Waiheke Island, just outside Auckland, has shown some of the most startling increases in value, according to Nicholas Chidley, also of Bayleys Real Estate. The median price there in­creased 96 percent between late 2002 and March 2004, from NZ$225,000 to NZ$444,000 ($156,800 to $309,400). And despite a drop last year, waterfront properties in Auckland and its suburbs, on the Coromandel Peninsula in the Bay of Plenty and in the winery center of Hawkes Bay, have maintained or increased their value as of late.

On the South Island, most of the real estate action has centered in Nelson/Marlborough, Queenstown and Central Otago–known for its mountain-meets-lake scenery, world-class ski runs, backcountry heli-skiing, boating and fishing–where median prices rose 40 percent in both 2003 and 2004.

Maison des Chevaux, a home on Arana Point that recently sold for $4.1 mil. Photograph by Bruce Clarke. (Click image to enlarge)

For foreign buyers, “there are isolated mainland or island purchases available around the country,” says Simon Hartley, business reporter of the Otago Daily Times, “with many homestead-style refurbished houses with 100-year-old grounds periodically on the market, priced anywhere from NZ$1 million to NZ$4 million ($687,000 to $2,747,000).In fact, Hartley adds, about 50 percent of the land between Wanaka and Queenstown is foreign-owned, though that phenomenon is largely due to Canadian singer Shania Twain and her husband Robert “Mutt” Lange, who bought a 24,700-hectare (61,000-acre) homestead. The purchase raised questions for New Zealanders, who increasingly want “to know what new owners of large swaths of often commercially productive, scenic or culturally valued land plan to do with it, and how that will affect historic public access ways,” says Hartley. Twain (by all accounts full of good intentions) said she intended to farm merino sheep, create a 12,000-hectare (29,640-acre) conservation estate, provide a public walking track and build two tramping huts.

Panama
With coasts on both the caribbean sea and the Pacific Ocean–and a world-famous canal connecting them–Panama has recently burst onto the global real estate scene. Prices in Panama have quadrupled in the last few years, according to some estimates, aided by the  endorsement by AARP magazine, which has labeled Panama one of the best foreign retirement destinations in the Western Hemisphere. 

The capital, Panama City, is an energetic metropolis of futuristic skyscrapers. “The capital is the banking center of a country that’s friendly to foreign investors,” says Lincoln Garcia, who is developing PanCanal View, two 36-story luxury residential towers near the new U.S. embassy building. American buyers appreciate the tax incentives and the dollar-based economy, as well as “low inflation, good infrastructure, cheap phone rates and good cell phone service,” adds Garcia.

The city’s luxury life has clustered at its eastern edge, in Costa del Este and in the downtown Punta Pacifica area, where 10 different residential condominium developments are going up, says Frank Morrice Arias of Century 21 Semusa Realty. “Foreigners look to the condos particularly for security and convenience,” he says.
 

This home was originally built as a lighthouse station by the U.S. government at Punta Mala on Panama’s Azuero Peninsula. Photography by Sam Taliaferro. (Click images to enlarge)

Those who prefer isolation (and who don’t mind possibly having to put in or upgrade roads and utilities) might follow Mick Jagger, Bruce Willis and Tommy Lee Jones into property ownership on Panama’s Azuero Peninsula. “There is tremendous potential in the area,” says Robert Cheesbrough, of Prestige World Properties, which is offering, in cooperation with Sandra Realty, 124 acres of pristine oceanfront for $1.852 million.

Most of Panama’s coastal development, including standout projects like Vistamar and Buenaventura, has occurred on the Pacific side, from Playa Coronado to just past Rio Hato. In the cool, coffee-growing highlands, the town of Boquete has mushroomed with new communities, including the gated upscale Valle Escondido.

Meanwhile, the Pearl Islands –only 15 minutes by air from Panama City, and the site of a recent Survivor series–are well positioned to take off. The island of Contadora has the airport, and on Isla del Rey, the largest, are several rivers. A European group re­cently purchased a 6,000-acre property for a high-end project. And all those gorgeous white-sand beaches make the thought of surviving there very attractive.Patagonia
Huge cattle ranches below snowcapped peaks, pristine rivers filled with trout, white water flowing through majestic canyons: No, this is not the American West but the Argentine South–the lakes area of Patagonia, to be precise. However, the attractions are much the same as those in Colorado, Montana and Idaho, says Jeff Wells, one of the founders of Austral Real Estate, which specializes in estancias, or trophy ranches in the country.

Patagonia, which extends more than 1,000 miles, encompasses part of Chile, where the coastal area of the Gulf of Corcovado is “reminiscent of Seattle or the Norwegian fjords,” says Wells. But more North Americans head for Argentina–around San Martin de los Andes, San Carlos de Bariloche and Esquel. At the edge of the Andes, the clouds dump moisture that produces lush, green vistas.

Scenes from the Arelauquen Golf & Country Club in Bariloche: The lodge (top photograph) and a private residence on Lake Gutierrez (bottom photograph). Photography by Burco Group. (Click images to enlarge)

Even so, the beauty of Patagonia might have gone unnoticed without Ted Turner’s purchase of a 55,000-acre ranch here in the late 1990s. “People thought, ‘If Turner did it, maybe I should do it, too,’ ” says Wells. “And for a million or so, you got what would cost $50 million in the States. Over the last seven years, the estates that would have been one to two million are now three to five.”

Neville Johnson, sales director for Gateway to South America Ltd., adds, “Prices in the Andes Mountains and foothills–some of the most beautiful scenery in the world–have lifted spectacularly.” Properties in lakeside sections up to 220,000 hectares (543,400 acres) are available, and while these are far more expensive than they would be if sold for farmland, “they’re still relatively cheap based on international values.”

“There are parts of Chile and Argentina that are like farm towns in the States 30 years ago,” Wells says. Over the next two years, as the airports are enlarged and new roads are put in, he says, the area should also attract people who “aren’t pioneers. In 1997, when I bought my own ranch, I was the first foreigner in the area since the 1930s. Now every neighbor I have is from another part of the world.”

Spain
Poets may write about castles in spain, but traditionally, upscale real estate investors have focused on the sun and sea there. Foreign buyers (and notables like Michael Douglas, Julio Iglesias and the royal family of Saudi Arabia) have turned to the island of Majorca, the south coast (Sotogrande, around Cadiz), Marbella and the Costa del Sol, the Valencia Coast and the Costa Brava, north of Barcelona, says Josep L—pez Deiros of the real estate firm Fincas-Exclusivas.

When it comes to the Costa Brava, Deiros says, “The attraction is the beauty of romantic coves and fishermen’s towns.” In Girona, which Deiros names as having “exceptional air connections with Great Britain,” there is the additional bonus of medieval architecture.Diana Morales of DM Properties in Marbella says, “People move here to retire or to live and work away from the colder northern weather.”

The real estate boom over the last four to five years has been extraordinary: “It’s doubled all over Spain,” says Deiros. Morales cautions, however, that the frenzy of construction on the Costa del Sol is over. Even so, economic forecasts indicate increases in property values of 15 percent.

A beachfront villa in the Guadalmina development of Marbella–an area that boasts Roman ruins and two 18-hole golf courses.  Photograph by Pedro Garrido Franquelo. (Click image to enlarge)

In the Marbella area, that translates to luxe (not beachfront) apartments costing $3,000 to $5,000 per square meter ($387 to $645 per square foot). For villas and country estates, Deiros cites an average of $5 million ($6.45 million).

Golfing is luring homebuyers away from the coast, where the building restrictions for new developments are extremely prohibitive. Around Barce­lona, there is “an increasing interest for properties inland” near golfing areas, Deiros says. “Investors can find 2 hectares (4.94 acres) of land around an old Catalan country house–and the beach is still only 45 minutes away.

Morales reports that more buyers are going be­yond the hilltop properties around Marbella and looking at new resorts that offer golf course and country club facilities, saying, “Within these resorts, it is still possible to acquire large plots of land at very reasonable prices to build one’s own home.” Perhaps even a castle.

RESOURCES

AUSTRALIA
McGrath Estate Agents, +612.9386.3333, www.mcgrath.com.au

FRANCE
Belles Demeures de France (a Christie’s Affiliate), Daniel Feau Group, +33.14008.1000, www.feau-immobilier.fr
Anciennes Demeures, Sotheby’s International Realty, 33.4.67.02.78.05, www.anciennesdemeures.com

MEXICO
Webster Enterprises, 505.954.9500, www.chriswebster.com
La Punta Realty, +52.329.291.6420, www.lapuntarealty.com

NEW ZEALAND
Bayleys Real Estate, +64.9.309.6020, www.bayleys.co.nz

PANAMA
PanCanal View, +507.6613.0005, www.pancanalview.com
Century 21 Semusa Realty, +507.270.6050, www.semusarealty.com
Prestige World Properties, 866.685.7458, www.prestigeworldproperties.com
Buenaventura, +507.270.2277, www.buenaventura.com.pa
Valle Escondido, +507.720.2897,www.valleescondido.biz

PATAGONIA
Austral Real Estate, 303.888.9785, www. australrealestate.com
Gateway to South America, +54.11.4785.7196,
www.gatewaytosouthamerica.net

SPAIN
Fincas Exclusivas, SL, +34.932.40.40.89, www.fincas-exclusivas.com
Diana Morales Properties, Sotheby’s International Realty, +34.952.765.138, www.dmproperties.com