Construction Boom in Costa Rica
Richard: Good afternoon, Christian. How you doing?
Christian: I am doing fantastic, Richard. How. How’s everything? Thank you for having me one more time in your podcast.
Richard: Not at all. I’d love to get your. Your viewpoint on here. And, you know, again, as I said, I mean, we’ll speak to anyone that’s in construction, real estate investing here in Costa Rica. And, you know, I think you guys do a great job. So it’s. It’s great to get your name and also information about your business kind of out there.
Christian: So.
Richard: So. Yeah. Well, Christian, my first job for you, My first question for you is just trying to get an idea of kind of what’s happening in the market at the moment, how your level of work is. You know, there’s a lot of volatility in the western world at the moment. You know, the markets are kind of up and down a little bit. There’s a lot of, you know, I would say uncertainty at the moment, but I mean, what are you seeing happening here in Costa Rica and in particular, is your workload increasing? Is it the same? Is it decreasing?
Christian: Well, Richard, something they can tell you right now, straight up, it is that our work is being increasing like three times. You know, we are running like crazy. We are working a lot. You know, our company grown the last two years from having 40 workers. Now we are 108 workers and, you know, getting better and better and better. What we are seeing it is a lot of people are taking that decision to start to, you know, pretty much move forward with the original plans of having a house in Costa Rica. So now that actually they are, you know, starting. So that is what we’re seeing. And we are seeing, you know, not just North Americans coming, so Europeans, a lot of Europeans. So the southern area, Costa Rica, is exploding with opportunities of construction. And what we see is that pretty much everybody want to be here.
Richard: You don’t think that’s going to slow down at all, Christian?
Christian: I don’t know. You know, hard to tell. But normally what, you know, what are we expect it is that this is going to continue growing. You know, the world at this moment is really unstable. The, you know, pretty much what we can do is really is continue with this rhythm until, you know, something else happened, you know, another crisis or another pandemic. But in this moment, everything looks, look fantastic. You know, we are in the perfect scenario to build, develop, and continue growing businesses in the southern area, Costa Rica.
Avoiding Construction Nightmares in Costa Rica
Richard: Awesome, man. I mean, most people, when they think about building in Costa Rica are like, I mean, it’s a nightmare. I mean if you go on a Facebook, which is not a great litmus test for stuff and someone’s like, hey, I’m looking to build in Costa Rica. The comments are good luck. Like you’ll lose your shorts. Like, you know. But how do people make sure that they don’t, as I say, lose their shirt or camisa know when doing in in construction in Costa Rica?
Christian: Well, what is happening it is that a lot of people get what they pay for. You know, they don’t get really informed what they are working with. They’re not working with professional companies. They are not working with that type of engineers or architect that they are subscribed to the college engineering architects. So they get in the end burn for people that they are. They don’t have the best practices and businesses. But if you want to do a successful project, you know, you have to know who you are working with. That is why we trying to present our company, you know, trying to be clear with our clients in every single way so they know who they’re working with and what kind of product they’re going to expect from us. You know, that is all the time. You see that social media, you know, somebody, you know, don’t show up anymore in my property or somebody steal this from my property. But they never do a homework to research who they are working with. So, you know, I have a saying, you’re going to get what you’re paying for.
Richard: Yeah. Which I think really applies here in Costa Rica. And you need to trust but verify everything. I mean that, you know, I mean we hear horror stories in construction. It was like the guy was so nice and it was like, yeah, but if you’d have done your due diligence, you’d have probably found out that there were other projects that they also kind of, you know, didn’t do correctly as well.
Christian: Absolutely, that is correct, Richard. That. And that happens so many cases. It’s sad to say say, you know, that a lot of Costa Ricans or even in this moment it is not just Costa Ricans. It is a lot of people from different countries, you know, that they just came down, they believe that they know how to build for their company and you know, a few months later they grab projects and they do a nightmare for somebody. So, you know, we have 17 years in business and all what we’re trying to do, you know, that is our first the priority. It is customer satisfaction. We know that we are not perfect. Probably we are going to have, you know, problems or mistakes through the process. But if we are clear and we talk straight up, I know that every single detail can be fixed.
Richard: Yeah, I mean, I agree, man. I mean, you know, it’s just, I suppose like in life of like when a problem comes up, you know, accept responsibility if it doesn’t find a solution. People don’t want to hear problems, you know, they want solutions of like, okay, absolutely, you know, how do we fix this? So, and I mean, again, as you said, there always happens in construction, man.
Christian: Absolutely. Well, I think that is the attitude, you know, what kind of attitude you have through problems and that is going to make you go faster, you know, through the solution.
Richard: So.
Christian: And that is pretty much what we do. We find solutions for our clients.
Common Construction Problems and Prevention
Richard: Yeah, I mean, where do, where do construction projects usually go wrong in Costa Rica, Christine? I mean, where do you typically see other projects kind of falling off or just. Yeah, just stuff not being delivered on time, mistakes being made. I mean, what are some of the things that typically go wrong?
Christian: Budget, budget control, you know, money, Money situations. Sometimes people just want to, you know, they want to grab the project. So they don’t do the right numbers. They just present ridiculous numbers to the client. In the end, you know, when the money is gone, everybody’s in the fight. But, you know, that is what we try to avoid. We’re trying to do that, right. Numbers in the beginning. Of course, you know, weather in Costa Rica also is another factor. But numbers, money, you know, budget, it is the worst scenario ever.
Richard: But how do you make sure? Because again, someone comes down, they’re not typically bidding out a project to three or five people. Sometimes, you know, a lot of the time it’s maybe their architect has got this construction company. And again, we pick up projects that go wrong all the time, man. I mean, you know, like, hey, they said they could do it for 650. They got 60 or 70% through and say that there’s no more money left. And it was like, well, just looking at it, I could tell you that was never going to be built for 650. That’s an 850 or $900,000 project. But like, how do you, someone that doesn’t know, man, I mean, you know, they know what they don’t know, what they don’t know, which is that they put a lot of trust in someone, they come back with this number. But like, how do you verify those numbers?
Christian: Well, you know, the information have to be controlled, you know, from the beginning. The client have to set up a Team with an architect, engineers and the builder and all the time share and, you know, make sure that what people is sharing, the information they’re sharing is correct. So what I do in my projects, it is that we have inspection for the professionals, you know, architects, engineer every month and we evaluate the percentage that we have done. And I develop a system over the last 10 years. It is, you know, this might sound crazy for many builders or many people, but I don’t request money in front, you know, over, over the time. My clients only pay for work that is already done. So, you know, this sounds a little strange. Nobody worked like that, but I know that my system is so good and my system works fine because we do the right numbers and we have the right team that, you know, I pay all the new age construction. My company paid through month by month, the bills. In the end of the month, we send a spreadsheet really clear with all that different bills, with all the different expenses of the project and the client just reimbursed the money and we continue working month by month until the project is done. That is one way to secure that the job is getting done. And you know, that you are not burning yourself, you know, paying high percentages in front.
Richard: I mean, as you just said though, that’s not very often that happens. I mean, you’re kind of a unicorn in that front Christie. And usually it’s the client, you know, cash flowing, the build. So. But my question here is like, I mean, but I mean, basically you probably have to bid your project out or have like a third party review the numbers. Like, because if, if you’re only putting it with one construction company, you don’t know if that makes sense. Whether those numbers are real or not.
Christian: What we do. Yes, definitely, you know, definitely. If the client want to have three or four different bits, that is totally fine. What we do normally since the beginning when we’re designing, I told my clients, hey, you know, let’s talk clear. I mean, we don’t want to design or we don’t want to go through a process designing something that is too big or too expensive and you don’t have the ability to go forward with this kind of project. So if you tell us pretty much a ballpark how much it is your budget, we design and we have everything figured out and the amount that the client want to build.
Richard: Yeah.
Christian: After that we set up a spreadsheet, you know, Excel spreadsheet from day one until finish, you know, with foundations on and on and on, list up with a price of materials through Hardware stores and everything else. And then the client with the architect can review the numbers, can review the time frame, the chronogram, the budget, and say this sounds all right, or this is too crazy. But yeah, definitely the client. You know, the main point of this, it is that the client have to do the due diligence, have to, you know, get to work on the numbers, have to spend some time reviewing the contracts. That is the key point to success any project.
Richard: Yeah, I mean, I think the word is trust. But verify everything in Costa Rica. Right. Like trust, but then make sure that you verify stuff with other third parties.
Christian: Absolutely. Trust. Have to be with, you know, with professionalism and also by experience. Yeah, I mean, I can, I only trust somebody when they can present me 10 projects that went right from the beginning until the end. I don’t trust nobody just to tell me, you know, I know how to build, I have a crew, I have tools, I can help you out. If somebody came to me and said that, I say, well, how we can prove that you have that quality experience or the skill that we require for this project? I mean, I need at least 10 stories behind that person in order to believe what he’s saying. So like I say, it’s time to make some homework.
Client Tips for Successful Construction Projects
Richard: I mean, how can clients help the construction companies during the process? I mean, number one I could think of is pay on time. Because the more that you pay on time, like if you have delays, it’s getting like crews on. I mean, maybe not so much for you, Christian, because as you mentioned there you cash flow, a lot of it. But I know for some construction companies, like if there’s a delay of two or three weeks and a payment that like the manpower on the job might slow down a little bit because the again, the construction company might not have the bandwidth and cash flow to pay for it. But like, what other stuff can clients do to help construction companies during the.
Christian: Process get involved in the project? I mean, it’s really important that the client being decided. I mean, if they’re overseas, of course they have to have reviews, they have to have somebody to make videos and they need some kind of manager to review what people is doing here. But paying on time is critical, you know, especially take advantage of good pricing. You know, here now with the instability of the dollar is changing rate, that, that is crazy. Buying materials, you know, from one week to another ones, the material can be 10, 12, 15% different in prices. So when it goes down, you know, you have to take advantage of that. So trying to all the time have money available in the country to, you know, use it and you know, have a buying power to, to use these discounts and also paying on time, that is critical to the successful of the project. That makes a big difference. You know, if you have to take out your crew and bring it back two weeks later, work three months and then take it out because the client doesn’t send money, I’m, you know, that is going to screw up all the rhythm. You know, this is like a playing a song. You know, you need a rhythm to go duty by duty until then. So.
Richard: Yeah, I agree. And I mean, I think just, you know, I mean just my experience is just being clear on the finishes or anything that’s important in the home just so that like you’re not slowing down on like again, you guys asking for floor tile that the client wants and then them taking months to decide what they want it is, but like already knowing a lot of that stuff beforehand.
Christian: That is, that is important actually before the project start. You know, with architect, all these details have to be clear. I mean, if we have all the information ahead, we can have tiles one or two months before they need inside. So. And also all that kind of finishes. You know, logistics are number one. Logistics have to be all the time really well improved. You know, normally everybody have a space at the building site to have a little shack, a little storage, to have things already there. So, you know, time, especially in Costa Rica, you know, we have a lot of rain in Costa Rica. The rainy season, it is weird. Sometimes it rains a lot, sometimes don’t rain at all. So right here we have to join every single minute of good weather. And you know, the labor and the main power have to be all the time using the most, you know, taking the more advantage possible. So missing materials in the, in the building site, it is not acceptable.
Richard: Yeah, I agree, I agree. A lot of people look to value Engineer their builds here in Costa Rica, Christian, when it actually comes time to it, I mean, what are the things that they could consider that would help Value engineer and reduce their costs?
Christian: Pretty much the experience that they have in the market. You know, I know there is a lot of new young engineers that they’re just getting there, but they have to open up their career. Probably they have to next work next to somebody with more experience for a while until they can run in their own feet. But the experience is total. You know, we work in different terrains. You know, especially when you work in the hills, you know exactly what you’re doing in your foundations. You, you need to know your computation, your excavation, everything that can be critical. You know, in the end, if you are putting a million dollar home in the slope and the foundations are not that special designs for the house and in the future that is going to have a problem. So engineering and architect have to be based on experience, you know. And it’s difficult to say because every story is different. But right here you have to go like proofing error, you know, proofing error, you know, make some mistakes, learn from that. And then you know, you will have a lot of experience in order to have something well done.
Construction Challenges in Southern Costa Rica
Richard: Christian, I mean you guys do most of the stuff I would say in that southern zone. I call it kind of the central southern zone. Because I know you work a little bit in the central. But I mean, how does building in that part of the country differ from say Guanacaste or the city or you know, any other areas?
Christian: Well, transportation, it is horrible. You know, we have to make our planification really good because the roads, you know, when you are having a 12 meter loader going in the hills, the only four wheel drive right there. Yeah, it is where you know exactly that you have to do things right once or you are going to screw it up. You, you know, delivering materials in the building sites, it is really important and also really difficult. We have to. Sometimes we have to shut up a project because we don’t have the material that we need. And it’s raining for two or three weeks straight and we cannot get materials inside. So. And also we can don’t have big machines, you know, in the capital, in the city, in San Jose, if you want to pour concrete, you just call the concrete company. Hey, I need 15, 20 cubic meters and the next morning you have it right there. Here in the south, pretty much every have to be done by by hand, you know, from scratch. Because we don’t have the ability to have this heavy equipment in the hills. And pretty much I can say, you know, we can work with the same quality anywhere else in the, in the country. But the way to do it is a little different because they have to be done by by hand work, you know, by, by people. We cannot use so many machines. But yeah, after that everything is pretty much the same.
Investment Opportunities in Costa Rica’s Southern Zone
Richard: Okay. What areas of Costa Rica would you be investing in? And I know that you are investing for the next five to ten years.
Christian: Definitely here in the south. The south, it is a diamond. They need to polish a little bit, you know. Now we see Guanacaste. I actually it was last week in wanna caste for little Vacation and I see all this development, but when a caste is getting too pricey, so that profit, the profit margin is get, is getting reduced. You know, if you invest a million dollars there, you are doing a match mode with a million dollars. If you invest it here in the south, you can, you know, extend the million a lot more.
Richard: Are there any particular areas like investing for the future, like five or 10 years that you think people should look at?
Christian: Absolutely. You know, between Quepos and Dominical here in the south is an area called Portalon. Portalon is growing like crazy in this moment. You know, actually you can still find in lots between 100, 150, $200,000 that, that is impossible to find in Guanacaste nowadays. Portalon or the area between Quepos and Dominical, it’s going to be. In five years, it is going to be a successful, no doubt. Actually, I have some folks working in the area, they call, is it called Friends of Portalon. That they’re doing an amazing job right there. And I mean, that is the area to be, you know, this is the new tamarindo, this is the new nosara, the new Uvita. It is port alone.
Richard: Okay, my last question for you, Christian. If I kept you long enough, and I know that you’re busy with a lot of construction projects, but if you inherited $500,000, you had $500,000 and you had to invest it into a business or real estate in Costa Rica, what would you invest it in and why?
Christian: Absolutely. Real estate. You know, I will buy a piece of farm, I will develop and sell. I can probably from the $500,000, in a period of two years, I can make $2 million.
Richard: Wow.
Christian: So. So, you know, that is, you know, that is a simple math. I mean, and real estate is not something really complicated.
Richard: So I mean, explain that out a little bit. You would buy a piece of land and develop it and sell it on or subdivide it. And like, where would you, where would you look, Christine? Just because I know people are very interested in knowing a little bit more about what you would do.
Christian: Yes, probably I will buy a property they can subdivide. Trying to, you know, trying to. Let’s say that if I can buy with half a million dollars, maybe I can buy 10 hectares, make 10 different lots and sell it in $200,000 each lot, you know, so that is a simple process. Don’t. It’s not so complicated, you know, just working a little bit with that Water. Water disposability, electrical letters. Electrical disposability. And that’s it. You know, you don’t have to do much and you don’t triple or quadrup your money and. Pretty simple.
Richard: Awesome. Well, Christian, it’s been an absolute pleasure having you here on the podcast. I again appreciate you taking the time and also sharing your knowledge with us. And again, anyone that wants to get in contact with Christian, I’ll put all of his contact details and New Age construction in the description down below, but thank you very much, sir.
Christian: Thank you very much, Richard, to have me. Thank you very much to everybody that’s listening this podcast. Hopefully we can help you in the near future and New Age Construction continue doing amazing things here in the South.
Richard: Awesome. Thanks, Christian.
Christian: Thank you. Have a good one.
Richard: You too. Bye.
