Contents of this article
The dollar advantage for the Puerto Rican investor
Panama has used the US dollar as legal tender since 1904, alongside the balboa, which exists only in coins and has a fixed parity. For anyone managing their wealth in dollars from Puerto Rico that removes the biggest friction of international investing: there is no conversion on the way in, no conversion when repatriating income and the return projection does not depend on an exchange rate. As Inversiones y Negocios en Panamá sums it up, “investing from Puerto Rico in Panama involves no exchange-rate analysis: both economies use the dollar as their reference currency”.
Same currency
The dollar as legal tender, with no exchange controls or restrictions on repatriating capital.
Banking system
An international banking centre with dozens of general-licence banks supervised by the Superintendency of Banks.
Connectivity
Direct flights between San Juan and Tocumen and a one-hour time difference.
Language and culture
Procedures, contracts and management in Spanish, with no translation intermediaries.
Territorial taxation: what is taxed and what is not
Besides income tax on rents, the owner of a commercial unit pays property tax on the cadastral value and, on sale, a transfer tax and an advance on capital gains. The details of those charges and of the exemptions are in Radar Panamá’s guide to buying property in Panama as a foreigner. Anyone who prefers to structure the investment through a Panamanian company can consult the guide to opening a company in Panama.
Who Grupo Los Pueblos is
Grupo Los Pueblos is one of the largest real estate developers in Panama, with more than three decades of activity in shopping centres, offices, housing and storage. Its best-known project is Albrook Mall, one of the largest shopping centres in Latin America, next to the national transport terminal. The group regularly works with foreign investors remotely and combines its commercial portfolio with residential developments such as Playa Dorada and Bayside, which Radar Panamá compares in its ranking of residential projects for foreign investors.
The commercial projects, one by one
Santa María Business District
A business district inside Santa María Golf & Country Club, east of the city and close to Tocumen airport. It combines offices, retail and services in a planned community with private security, giving the investor a diversified portfolio in a single location and a captive audience of the club’s residents and companies.
Panamá Viejo Business Center
A low-density corporate office development in the Panamá Viejo area, with a central location, extensive grounds and multiple facilities. It is designed for companies that want their own headquarters outside the towers of the banking district, with easier parking and access.
Supreme Storage
A storage concept in strategic locations across the city, with high-quality facilities and specialised staff. Self-storage is a segment with growing demand in Panama thanks to e-commerce, light logistics and the turnover of expatriates.
Federal Mall, David
A shopping centre 1.5 kilometres from the centre of David, the capital of Chiriquí and the country’s second city. It is the group’s bet on the interior: an agricultural and cattle-farming region with a growing population and no comparable retail offer.
Albrook Mall
The flagship: more than 700 shops, cinemas, entertainment and a hotel, connected to the Gran Terminal Nacional de Transporte and the metro station. It is an established asset, with traffic guaranteed by public transport, rather than a project under development.
Westland Mall
The retail landmark of Panamá Oeste, in Arraiján, one of the fastest-growing areas of the country in population thanks to the third bridge over the Canal and the extension of metro line 3. It combines shopping, entertainment and services for the region’s families.
Comparison table
| Project | Type | Area | Investment case |
|---|---|---|---|
| Santa María Business District | Offices and retail | Santa María, east of the city | Diversified portfolio inside a planned club |
| Panamá Viejo Business Center | Low-density offices | Panamá Viejo | Central corporate headquarters outside the towers |
| Supreme Storage | Self-storage | Several locations | Growing demand from light logistics and e-commerce |
| Federal Mall | Shopping centre | David, Chiriquí | First centre of its kind in the interior of the country |
| Albrook Mall | Established shopping centre | Albrook, Panama City | Traffic secured by the transport terminal and metro |
| Westland Mall | Shopping centre | Arraiján, Panamá Oeste | Fastest-growing area of the country by population |
How to invest from Puerto Rico
- Define the vehicle. Purchase in a personal capacity or through a Panamanian corporation; the latter makes succession and joint management with partners easier.
- Due diligence on the asset. Title at the Public Registry, current lease agreements, maintenance fees and the status of exemptions.
- Bank account in Panama. Needed to receive rents; banks ask for source of funds, references and recent tax returns.
- Signing and registration. Promise of sale, deed before a notary and registration; all of it can be done through a power of attorney to a lawyer without travelling.
- Compliance in both jurisdictions. A tax return in Panama for the local income and a review with a Puerto Rico adviser of how that income is reported on the island and to the IRS.
Want to evaluate a GLP commercial project from Puerto Rico?
Inversiones y Negocios en Panamá, a portal specialising in investment opportunities, real estate projects and advice for those who want to invest or settle in the country, publishes the full analysis of Grupo Los Pueblos’ shopping centres and projects and answers enquiries from investors outside Panama.
See the shopping centres and business projects in Panama for those living in Puerto Rico
Frequently asked questions
Do dollars have to be converted into another currency to invest in Panama?
No. Panama uses the US dollar as legal tender alongside the balboa, which has a fixed one-to-one parity.
What taxes does a foreign investor pay in Panama?
Only on Panamanian-source income, such as the rents from a commercial unit in the country, plus property tax and, on sale, the transfer tax and the advance on capital gains.
Are GLP projects available to investors outside Panama?
Yes. Grupo Los Pueblos works with foreign investors, including those from Puerto Rico, remotely and through a power of attorney to a local lawyer.
How is income earned in Panama reported in Puerto Rico?
It depends on the investor’s personal tax situation; it should be reviewed with an adviser on the island, since Panama only taxes what is generated in its territory.
What other property types does the group offer besides shopping centres?
Offices, self-storage and residential developments such as Playa Dorada and Bayside, designed to combine investment with personal use.
Is it necessary to travel to Panama to buy?
No. The purchase, the incorporation of a company and the registration can be done through a power of attorney granted to a Panamanian lawyer; opening a bank account may require an interview, in person or remotely depending on the bank.
Sources
- Centros comerciales: transformando la experiencia de negocios en Panamá si vives en Puerto Rico, Inversiones y Negocios en Panamá.
- Grupo Los Pueblos, the developer’s official website.
- Tax Code of Panama, article 694, territoriality principle.
- Directorate General of Revenue of Panama.
- Superintendency of Banks of Panama, international banking centre.
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