Investigations are being made into the investment of $100 million in the expansion of underground cables in new areas of the capital and the provinces.
The National Authority of Public Services and the electricity distributor Gas Natural Fenosa are studying burying power lines in other areas of the capital city and the countryside. The preliminary estimate of the investment is $100 million.
In 2013 the number of building permits requested for hotel establishments across the country dropped by 62% compared to 2012.
The number of square meters authorized in the last 12 months between February 2013 and January 2014 fell to 47,515 m2 compared with the 126,036 m2 in the previous period, according to the Costa Rican Chamber of Construction.
Prices for cement, plastic pipes and stone reported the largest increase.
From a statement issued by the Comptroller General of the Republic of Panama:
Retail Prices Indices of the Main Construction Materials (IPMC), available in the districts of Panama and San Miguelito, compiled until January 2014, showed the following behaviors:
In 2014 the dynamism of the sector will depend on the speed with which the current infrastructure problems and excessive paperwork can be resolved.
The Costa Rican Chamber of Construction (CCC) today announced that 2013 closed with a decline of 1.7%, about 99 thousand square meters less than in 2012.
From a press release by the Costa Rican Chamber of Construction:
The construction consortium Grupo Unidos por el Canal is demanding $1.6 billion for cost overruns and is threatening to stop the works.
Citing the existence of undetected geological faults Grupo Unidos por el Canal (GUPC), is demanding from the Panama Canal Authority (ACP), payment of $1.6 billion for cost overruns caused by alterations to the original technical conditions of the tender awarded to GUPC.
The increase of 13 % compared to 2012 is mainly due to changes in international prices of construction materials.
In the capital city the cost of construction of an apartment building is about $1267 per sqm, while in the metropolitan area and its surroundings the cost is $1,169 per sqm." In relation to 2012 , the increase is 13 %, because in that year, what was paid in the city was $1,112 and $1,042 in the surrounding area", reported Prensalibre.com.
The sectors involved have agreed on a solution which means that the cost of the underground cabling will be between 1% and 3% of the cost of each house.
A short while ago it was believed that home values would increase by between $7000 and $9000, when the construction sector had not reached an agreement to amend Law 15 of April 26, 2012.
Panamaamerica.com.pa reports: "According to Law 15 of April 26, 2012, in order to lay the cables concrete viaducts should be used, which is very expensive, according to industry players. For this reason they have proposed the use of PVC and polyethylene pipes, especially regulated for this purpose, which does not affect the quality and safety of the system ... ".
Price Indexes of Major Retail Construction Materials in the districts of Panama and San Miguelito, up to September, 2013.
A statement from the Comptroller General of the Republic of Panama:
The Price Index of Major Retail Construction Materials (PIMC), available in the districts of Panama and San Miguelito, compiled as of September 2013, showed the following behaviors:
Construction unions in Panama are looking for a way to avoid an excessive increase in the value of homes due to underground cabling.
"The guilds of Panama involved in building and selling homes, have joined forces with the aim of making underground cables in new residential projects (...) not having a significant impact on the price of homes ...", reported Panamaamerica.com.pa.
In the first six months of 2013 the value of constructions was $956 million, up $38 million compared with the amount reported in 2012.
The figures were released by the National Institute of Statistics and Census (INEC). "This year the value of construction of residential projects was higher than that of non-residential, it amounted to $507.86 million, while non-residential totaled $448.59 million," noted an article in Panamaamerica.com.pa.
Price Indexes of Major Retail Construction Materials in the districts of Panama and San Miguelito, up to July 2013.
A statement from the Comptroller General of the Republic of Panama reads:
The Price Index of Major Retail Building Materials (IPMC), available in the districts of Panama and San Miguelito, compiled up to July 2013, showed the following behaviors:
House prices could increase by as much as $7000 because of underground cables laying, now postponed until January, in new residential complexes.
The Ministry of Housing and Territorial Ordinances has decided, along with promoters of urban projects, to postpone until January 2014, underground cable laying which was scheduled to start on September 1.
In recent years the percentage of taxes paid by promoters compared to the final cost of a home rose from 1.3% to 2.7%.
The price of building materials, labor and land values are not the only factors that influence the cost of housing, taxes collected for construction also affect the end buyers.
It is for this reason that the construction industry has shown its opposition to the tax increase that has been implemented on residential projects, since developers are the ones who bear the costs of infrastructure for sanitation and roads even when the work has been completely finished.
Despite high interest rates and the high cost of building materials, great opportunities lie ahead for Panama's construction industry.
Construction has been one of the engines driving economic growth in Panama. New residential neighborhoods, buildings, logistics parks and shopping centers, as well as major works such as Metro Line 1 and the Canal expansion are the projects currently being built in a country which many see as one of the most dynamic centers the region.
The construction of megaprojects has caused a high demand for cement and an increase in the prices of the main material for the construction industry.
The fact that only two companies (Argos, and Cemex) lead the Panamanian market has caused prices to skyrocket because they are setting the price of this item. Experts expect that when demand for this raw material decreases, so will prices.