THE CRANES ARE FLYING

Costa Rica 2018 | CONSTRUCTION & REAL ESTATE | INTERVIEW

TBY talks to Jose Luis Salinas, President of SCGMTD Architecture and Design, on bringing people back to the city, smart zoning changes, and the right matrix for building.

Jose Luis Salinas
BIOGRAPHY
The principal partner and president of SCGMTD Architecture and Design since 1993, the year the company was founded, Jose Luis Salinas’ architectural design and real state developer firm has experience in Costa Rica, Panama, Nicaragua, El Salvador, Honduras, Mexico, Barbados, and Trinidad and Tobago and consists of 24 professionals. Salinas has a degree in architecture from the University of Florida.

How is the Torres Paseo Colón project progressing?

The project is about 96% sold, though it took us some time to sell the second tower. When we did the bidding for the second tower, it went up 30% in dollar terms. In the middle of the crisis, everyone was doing what they had to do to get jobs, and the prices of materials and builders were low, which led to significant savings for us. We proved that people wanted to live in high rises and downtown. After this project, we moved back to the east side of the city and built a seven-story building there even though others were building outside the city. We have been working for years to bring people back to live in San José. We have not done anything in the heart of the city yet as we have not found the right property at the right price. We would love to build a high rise; however, it just has not happened yet.

How is it dealing with the local government, and what are they doing to spur development downtown?

The city of San José went through a major improvement in zoning a few years ago. When we built Torres Paseo Colón, it was the maximum height available for a building. Urban planning in the city was very restrictive, but then Johnny Araya Monge came along and changed many things. Now in certain areas of the city we can build more than 50 stories because the zoning has been changed. The city of San José is pro-investment and truly helps developers to achieve such projects. It provides a tax credit if we build in certain areas of the city. San José was in a terrible state 10-15 years ago and has significantly improved since then. The main avenue in San José has been transformed; all the parks and signage were redone and key government institutions are back downtown. Security has also improved significantly downtown, and there has been a great deal of renewal of buildings there. The Hotel Costa Rica, which was the main hotel 40-50 years ago, is undergoing renovations. There will also be a Hilton hotel next to the national theater. An American company built another five-star hotel as well. This is great news for the city because all these projects bring upscale tourists back into the heart of San José. There is the national theater, the art theater, museum areas, and many other nice things happening downtown.

Is proximity to resources or to workplaces the determining factor for buyers?

Proximity to their work is a main driver. There is work downtown because there are many government offices. Now with the heavy traffic and abundant conveniences, people want to move into the area surrounding downtown because they can find everything they need, including supermarkets, restaurants, and so on. People no longer need to have a car to have a high quality of life in an urban space. More people are interested in spending time in their homes instead of sitting in traffic. Costa Rica went through the same thing as the US; everyone moved to the suburbs. The suburbs in the US are well planned, ours aren't since we did not have the infrastructure to do so. Now things are improving.

Are you seeking plots of land downtown to build something?

We have found land that we like, but as of yet it is too expensive. A successful project is all about location, location, location—and the right price. If it is too expensive and we are unable to build as a result of external forces, then we end up with a piece of property we can do nothing with. Moreover, if the price of the land is high, then we have to charge more when we sell the condos. The value of the land cannot be more than 10% of the total cost of the project.