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By Staff at Panama Offshore Legal Services
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The national government is close to passing a new law extending an existing law allowing the government to seize unproductive private properties in the Old Quarter and develop them for an “urgent social interest.”
Those who walk around Panama City’s Casco Antiguo [aka Casco Viejo] neighborhood see up-close how the construction remodeling projects envelope the neighborhood. Those driving in a car notice that parking options are fewer than the barrio’s 2008-2012 phase. Riding a taxi in as close as one to get to the destination, as sometimes traffic access is limited to residents on festival days.
New cobblestones are being laid in the brick-lined streets and many abandoned buildings being refurbished. Activity fills neighborhood filled with beautiful 17th architecture from around the world from dating to the 17th century buildings which more recently sat abandoned for many decades.
Panama’s real estate boom that sparked in 2005 saw many of these old and decaying buildings become diamonds in the rough for speculators. A resurgence of the old neighborhood took place and today, a deli, restaurants, art galleries and nightlife attractions draw city-dwellers into the Old Quarter. A small hotel industry, although robust and growing considering the small geography of the peninsula, is another result of investor activity.
But some buyers had no intention of repairing them. They instead exercise a “sit back and wait” strategy for the right time to cash out of their investment. In turn, these buildings and lots remain locked up.
The new bill No 433 ,considered threatening by some, proposes ways that the government could conduct seizure of property in order to spark a simultaneous renaissance of the neighborhood which would transform the paradigm of the tourism potential in the area.
First is “by reason of urgent social concern.” While this has not been properly defined, situations such as urban blight or environmental hazards could be reasons to seize properties for an urgent social concern.
The new law will also provide a third way for an owner to lose the property when people occupy the property for a minimum of 15 years and the owner fails to take legal action to remove them. In the United States and other countries this is called “Adverse Possession” which allows a trespasser to be granted title to a property if he or she openly and continuously occupies the property and makes improvements while acting like an owner for a set minimum of years (which various among states and provinces). The purpose for such an extreme measure is to ensure that all properties are productive and not abandoned causing structures to decay and become unsafe and unsightly.
Take advantage of this renaissance in Casco Antiguo and other parts of Panama by consulting with a Panama real estate law firm to learn how to use the law to invest and develop unproductive properties into profitable ones.