Concession Property

Concession property is similar to a land lease arrangement, common in Mexico or Hawaii. This is where the government grants a Concession to an individual or an entity for a specific purpose, such as a real estate development, hotel, or marina. Most Concessions in Panama are granted for a maximum of 20-year (renewable) periods. However, some Concessions are granted for up to 40 years (renewable) in specially designated areas such as the Amador Causeway where commercial and condominium developments are currently being sold.

Concession Property exists in special coastal or other governmentally protected areas where actual title is prohibited by law. In many cases, real estate developments on Concession properties offer investors time-share or fractional ownership arrangements, which are very common in Mexico and other resort-type coastal areas around the world. Unlike Possession Rights property, the government through a specific contractual agreement guarantees Concession property. Therefore, there is very little risk to the investor. Title insurance companies generally offer title policies for Concession properties.

Acquiring Title Over Possession Properties
"Titling Process" is the official administrative procedure to purchase Rights of Possession property from the Panamanian government. You are buying the property from the government and registering the Buy-Sell Contract with the Public Registry. Island properties cannot become "Titled" according to the Constitution of the Republic of Panama (only mainland can become titled). However, there are some titled Island properties, registered before the Constitutional restrictions existed, which can be sold. All beachfront titled properties require a 22 meter set back due to high tide.

Title Insurance
Even though Panamanian laws are set up to protect foreign investors, you should always take precautionary measures to insure your investment. I recommend Title Insurance for every property transaction. This is readily available in Panama through major international title insurers, such as LandAmerica Lawyers Title and Stewart Title. Title policy costs are minimal and the peace of mind is definitely worth the cost.

In Conclusion: Now that you have learned the different types of real property rights in Panama, you can take steps to protect your investments. Look for "titled" properties first. Make sure that you use a competent real estate lawyer to prepare your Promise to Purchase Contract, to conduct a thorough Title Search, and to prepare your Buy-Sell Contract. Hire a good Escrow company to ensure that all documents are registered with the Public Registry before making final payment.

If you purchase Rights of Possession, hire a competent real estate lawyer to prepare your Promise to Purchase Rights of Possession Contract, conduct Due Diligence, and to prepare your Buy-Sell Contract. Hire a professional surveyor to verify all-important facts. Protect your original documents from loss because they will not be registered. Obtain Concession rights for using government property whenever you can. Again, hire a knowledgeable real estate lawyer to prepare your contracts. Finally, purchase Title Insurance to protect your investments.

With these precautions, you should be able to enjoy full rights of ownership or possession of your new real property purchases.