Properties on port: Barranquilla is growing with enormous potential

Immeasurable is the word Jorge Enrique Gómez used to describe the future of Colombia’s Atlantic coast. The president of regional real estate association Lonja de Bogotá, Gómez told OBG that the strip connecting Cartagena to Santa Marta holds large development potential and will no doubt receive an influx of national and foreign investment in the years to come. Affectionately referred to as La Arenosa (the Sandy City), Barranquilla was one of the country’s major ports at the beginning of the 20th century, providing a hub for international trade and industrial activities. The natural beauty of the Caribbean coastline also attracted leisure seekers to its shores where, according to Gómez, ostentatious mansions were built, mainly with illicit capital from money laundering. However, some 50 years ago Barranquilla began receiving massive migrations from rural areas, which in part drove many businesses away. The city was left to fall into decline with little economic activity aside from a frail tourism industry.

A NEW START: Today the city is turning another page in history and distancing itself from that image. “Barranquilla is experiencing development at incredibly fast rates, leading many Colombians to believe the port city will regain the fame it once enjoyed,” Gómez told OBG. “Real estate is booming, greatly influenced by the city’s industrial prospects and tourism. There is a large market for resorts and second homes.” Property sales in Barranquilla increased 7.5% in 2012, amounting to more than COP1trn ($600m), which is a historical record according to the city’s real estate association, Lonja de Barranquilla. According to the group, an average of some 1750 properties were sold per month in 2012, significant numbers for a city with slightly over 2m inhabitants. These figures represent mostly housing projects that cover a wide range of social segments and are partly explained by price hikes. National Administrative Department of Statistics figures show that in 2012 the price per sq metre for new property in Barranquilla increased 11.26% in value, just below the national average. Annual inflation on new property in Bogotá reached 12.78%, while Bucaramanga saw the highest rate in the country at 20.09%.

Nonetheless, Barranquilla’s land prices are still affordable and lower than the rest of the major cities along the coast. To illustrate the difference in prices between Bogotá and provincial cities, Gómez said high-end property valued at $7000 per sq metre in the capital would cost $4000 per sq metre in Barranquilla. “Affordable prices have helped the city initiate an important process of renovation and urban development,” Gómez told OBG. In general, construction and real estate firms have been embarking on projects in many of the country’s major urban areas outside of Bogotá due to more attractive prices and uncertainty over reform of the capital city’s Territorial Organisation Plan, which dictates rules for urban development.

BIG SPENDERS: Some of the high-end projects under way include the Grattacielo building, a residential skyscraper slated for inauguration in late 2013. Developed by Constructores Unidos with an investment of COP30bn ($18m), Grattacielo will have 39 floors and stand 160 metres tall. Another exclusive project is the apartment complex of Los Altos de Caujaral, developed by Prabyc, with properties ranging in size from 385 sq metres to 540 sq metres, and prices starting at $960,000. Foreign investment has started to arrive, coming mainly from regional countries such as Chile and Venezuela, but also from Spain and Asia.

INDUSTRY: In terms of industrial property, the city has a significant presence of free zones and will look to increase that potential with the onset of important free trade agreements, such as the one with the EU, which came into force on August 1, 2013. Of vital importance to Barranquilla’s industrial potential is a recent concession to dredge the Magdalena River, which connects the sea with industrial zones. Investment of $400m should leave the river fully navigable by 2016, which will also support tourism by allowing cruises easier access to Barranquilla’s historical downtown area. Such developments are likely to raise the quality of life.