Overseas construction blog part 1: Discovering Nicaragua, buying land…now what?
This is the first of a series of posts in which David Steckler shares his experiences of building a vacation home at Hacienda Iguana resort on Nicaragua’s Pacific coast. The goal of this candidly written construction blog is to reduce the anxiety levels of people who have bought Nicaragua real estate or property elsewhere in Central America and plan to build, but are afraid of making mistakes along the way.
It all started 5 years ago
Nearly 5 years ago I got it into my head that we should re-visit a third world country and this time it should be Nicaragua, a country the size of NYS where both of us grew up. Marcia and I had been to Honduras and Guatemala, but that was years before our daughter entered our lives and so this vacation would be to introduce our pre-teen to another side of life where oxcarts share the same roads with motorized vehicles and not every kid has an Ipod.
Prior to our trip we researched Nicaragua on the internet and also consulted the Moon Book series. Back in those days there wasn’t much to pick from in the travel section of the bookstores on Nicaragua so we relied heavily on the internet. In fact I stumbled upon a web-site called Nica Land – “Sweet livin & smart investing” that was started by a surfer dude aka Dale Dagger, who literally came ashore at Playa Gigante back in the late 70’s and never left. I was drawn to his laid-back approach to real estate and his philosophy of giving back to the community, so we started a correspondence.
A drop dead gorgeous beach
We met up with Dale in San Juan del Sur on the first leg of our vacation and before we left for Isla de Ometepe we had purchased property, with far less then the recommended due diligence strongly advocated by this site. I guess part of the reason we moved forward so quickly was that this particular resort was being developed by a Dutch group with a solid track record for developing projects of this kind including the Flamingo Resort on the Pacific side of Costa Rica. It also didn’t hurt that several attractive condos were nearly completed on their beach so we could see and touch them on our first visit to Hacienda Iguana. The Master Plan included a 9-hole golf course, and approved CC&R’s were in place. The primary reason we jumped into this investment, to be quite honest, was the drop dead gorgeous beach with picture perfect surf and sand.
Solidifying our “Nicaragua team” to build our dream home
We chose a collage for this first of many construction blogs that will follow to hopefully capture some of the physical and emotional reasons we were so drawn to this exotic place. It still took us 5 years of planning and more visits to Nicaragua before we could move past just owning property. We’re now comfortably ready to start building our dream home, which will take 11+/- months to complete. We spent a solid year interviewing Architects and later many Contractors before solidifying our “Nicaragua team”.
The key part of this process has to be connecting with the expatriate population living in the area you’ve chosen to invest. These folks will gladly steer you to the right people to glean information from. I did my due diligence here by expanding my network in every conceivable way…either through on-line Investor forums, Lodging web-sites specific to the Tola region, Property Management Services and, most importantly, just meeting the locals who live and work in the area. On one of our visits we stayed at a small surfer resort discovered on the internet and owned by a young couple from Europe. They built the entire complex using local trades people and gladly let us pick their brains for information during our stay.
We found our Architect, Jose Sanchez-Reyes: from one of the local contractors who eventually bid on our project. Jose is bi-lingual and very creative with space and the design process. We started out putting together a wish list of what we wanted in our house and then via email and skype fine tuned the floor plan to best capture light, prevailing wind and the best views from our lot. Once we were completely satisfied with the plans, construction drawings were generated so they’d be detailed enough for the contractors to bid on. As it happened the bids came back over our budget, which is not an uncommon occurrence. We ended up re-negotiating our contract arrangement with Jose so he could move forward and re-configure the plans to reduce the overall cost, keeping as much from our wish list intact.
The next round of bidding came in much closer to our agreed upon budget. We had four builders reviewing our detailed construction plans via jpg attachments sent to their offices. We required a “cost- plus” approach, which means their quotes, should have a breakdown of material and labor costs with the construction profit or management services separated out at the end. This approach I found to be the best way to compare apples to apples when the quotes came back from the contractors.
Hammering out the construction agreement
Once we chose our builder, Horizon Group: we rolled up our sleeves and hammered out the construction agreement with our Architect’s help so there would be no confusion down the road during construction. Since much of the time we’re not going to be at the building site our Architect will need to serve as quality control during critical stages of construction so being familiar with the construction agreement will play an important role here.
So now the Construction Agreement has been signed by both parties, the permit has been filed with the town and the first of 6 payments have been wire transferred to the builder. This first payment will cover Site prep, Material orders, labor wages, Temporary storage-Bodega, Foundation. In December I’ll have more on-site photos peppered with my thoughts so stay tuned!
Category : Blog &Overseas construction in Nicaragua
Marcy
Oct 29, 2010
I am looking forward to the next installment. I also hope to build a home abroad in Central America. I can’t speak Spanish which I hope wont be a problem. I like the idea of working with people who have done it before.
Simon
Nov 22, 2010
Are you planning on being in Nicaragua while the house is being built? How will you track progress and so on?
David Steckler
Dec 01, 2010
I’d love to be on-site for the entire project, but that isn’t possible as I still work full-time in the states. The builders send me photo updates every weekend as an attachment to their email and at critical junctions of the project I will have my Architect visit the site. I plan on visiting in the early summer to put in some sweat equity and catch up with misc. stuff.
Overseas Construction Blog Part 2: Are all your ducks in a row? | International real estate investing in Central America
Dec 07, 2010
[...] This is the first second of a series of posts in which David Steckler shares his experiences of building a vacation home at Hacienda Iguana resort on Nicaragua’s Pacific coast. The goal of this candidly written construction blog is to reduce the anxiety levels of people who have bought property in Central America and plan to build, but are afraid of making mistakes along the way. Read the first installment here. [...]
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Apr 05, 2011
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Overseas construction blog part 7: How about this color combination? | International real estate investing in Central America
Jul 07, 2011
[...] of building a vacation home at Hacienda Iguana resort on Nicaragua’s Pacific coast. Here are the first, second, third, fourth, fifth and sixth. The goal of this candid construction blog is to reduce the [...]
Alliance Concrete Pumps
Aug 02, 2011
I have heard quite a lot about Nicaragua. As a matter of fact a friend of mine has been bugging me to go down and check it out. They go to the Corn Islands…….. maybe its Little Corn. Anyway, they love it and have only good things to say. Great people, food and fishing. I am looking forward to reading your construction story. I have been curious about building something abroad. Thanks for your time and sharing. Dave