Building at the Beach

BEACH BUILDING: Regulations and present situation.
As a real estate investor you must know that the most desirable and expensive land in Costa Rica is beachfront. Most of coastal resorts are located on the beach in what is called the "maritime zone" or in Spanish "zona marítima". This area is a 200 meter wide strip of land running parallel to the coast, and is measured starting at the high tide line. This maritime zone is divided into a 50 meter strip closest to the shore ("inalienable zone") where no development can take place, while the remaining 150 meters can be rented from the local municipality and developed after the establishment of a regulatory plan with the Costa Rican government. However, the majority of available beachfront land does not possess a regulatory plan on file, since this is generally done just before the property is developed. Keep in mind that the regulatory plan is the most time consuming and expensive stage of obtaining the land lease, also known as a "concession", and is best accomplished through professional lawyers. If you manage to plan adequately, a concession can be obtained during the time that the proposed development is in its planning stages. If you are interested in developing land within the maritime zone, Buyowner Costa Rica advices you to seek expert assistance to avoid certified headaches.

The maritime zone runs for more than 1,500km (approximately 932mi) along both of Costa Rica’s coastlines. Over one third of this length (590km or 367mi) is available for legal development. The rest of the area is part of conservation mangrove swamps, National Parks, river mouths and other protected areas.

The majority of the land along the maritime zone has already been developed, albeit in an illegal way. Only a small portion is still open to development. For example, the local municipality of Santa Cruz, Guanacaste is allotted 50% of the land in the maritime zone; presently, they have already leased 40% of this to developers.

Legally, land can be obtained only through temporary 5 to 20 year concessions and must be developed in regards to a detailed regulatory plan consisting of a zoning plan; this shows what is going to be built and where, as well as presenting a construction implementation framework, showing in detail how all this is going to be handled.
These regulatory plans must be approved by
1. The local municipality;
2. The Costa Rican Tourist Board and
3. The Housing and Urban Development Department (INVU).

At present, only three hundred building concessions are registered in the ‘Registro Público’ and only two hundred of these are current and in accordance with the law. Nonetheless, there are fifteen thousand hotel and tourist developments situated along Costa Rica's coasts which have received government approval but, for inexplicable reasons, were able to bypass planning controls required by the law.

The majority of coastal properties under concession are leased at very low prices.
Most beaches are not regulated and merely a few have even been surveyed. Unfortunately, it has been a common practice to take beach land illegally through subornment or influence. The land is then sold to foreign investors interested in real estate who believe they are taking legal title to the property.

Most of the time, beach front property is untitled property because in Costa Rica the ownership and possession of land located on the shoreline is governed by the Maritime Zone Law (‘Ley Sobre la Zona Maritima Terrestre’); this law restricts the ownership and rights of beach front property. Legally speaking, the first 200 meters of beach front starting at the high tide markers are owned by the government. Of the 200 meters, the first 50 are deemed public zones and nobody may claim ownership or control that area. This leaves 150 meters remaining; these are then leased by the government through the local Municipal by way of concessions of land to private individuals. The Maritime Zone Law provides restrictions as to foreign ownership or possession of beach front property; this is the reason why so a more thorough and careful study is always required by a lawyer when it comes to buying beach front property in Costa Rica.

If you wish to lease the 150 meters of the maritime zone from the local municipality, you will have to meet with some legal prerequisites. These include:

• The area to be leased must be plotted with border markers ("mojones"), indicating the high-tide line and the line where the 150-meter sector starts. A large number of beaches in Costa Rica still do not have these markings in place. If this is the case with your property, you will have to apply to the National Geographic Institute for a survey to be carried out.
• Before purchasing property, you will need to find out if the beach has been declared of interest for tourism; you can do this by checking with the Concessions Department of the Costa Rican Tourism Institute (ICT). If no declaration exists, you must apply for one. If the beach is of interest for tourism - which is the case with most of the country's beaches - it needs a Regulatory Plan. If not, you will only need a Land-Use Plan.
• In the majority of cases, most beaches still lack a Regulatory Plan - a zoning plan dividing the beach into separate land-use areas (residential, recreational, tourism, commercial, green area, camping, etc). If you do not possess a regulatory plan, a municipality can give permits only for the construction of temporary structures, such as a kiosk or a hut. On the other hand, municipal corruption and incompetence mean that much of the tourism development that has taken place in the Maritime Zone has been done with no regulatory plan at all. A large number of buildings in the country's beach resorts risk being taken down once regulatory plans have been carried out, if their location does not coincide with land-use indicated in the plan.
• The land to be leased must be assessed by the Direct Taxation Agency, to define the amount to be paid in land tax. Concessions are given on a first-come, first-served basis, giving priority to those who possessed the land beforehand. They cannot be issued to foreigners who have resided in Costa Rica for less than five years, nor  to foreign-based or owned companies. Only companies with 50 percent of Costa Rican capital or more can apply for a concession. Many foreigners get around this by putting the concession in the name of a Costa Rican partner.
  Concessions cannot be sold or transferred without prior approval from the relevant authorities - the municipality, the ICT or the Agricultural Development Institute (IDA). The concession is basically the land lease. To build on the land, you need a construction permit, which involves a long phase and irritable application. You can build only according to what the zoning plan allows. Like we mentioned before, the regulatory plan is the most time-consuming and costly phase of obtaining a concession. It involves different surveys, looking at the area’s biology, geography, geology, sociology and architecture. It can take one to two years to complete. Then it must be submitted to public hearings for final approval.

Interested in reading some more?
Buyowner Costa Rica offers you some more articles that can help you out when it comes to purchasing real estate in our country. Click on the following links for further reading:

• Purchasing property
• Tips and advice
• Squatter conflicts