by Melissa Burdick Harmon
Six years ago, Marcus and Kristin Roehmer thought they might like to buy property in the Caribbean. So they did what most people do when they start dreaming that particular dream. They went online.
Marcus’ search led him to the Tropical Pathways website, and he signed up for a guided investment tour to Roatan, one of Honduras’ still relatively undiscovered Bay Islands in the western Caribbean. Next thing they knew, the Roehmers owned a beachfront house in Roatan’s West Bay Village. And that was just the beginning. Thy were so impressed by their tour, and the quality of advice they received, that they did additional Tropical Pathways investment tours to Panama and to Mexico’s Riviera Maya. They bought in both of those locations too.
Today the Roehmers are full-time residents of Playa del Carmen, Mexico, where they own and operate a large international real estate and property management company. “We owe a lot of our current success to Lyle Burke and that initial real estate trip we took to Roatan,” Marcus says.
Guided Investment Tours
Lyle Burke lived and sold real estate in the Caribbean, including four years on Roatan, where he started a ReMax franchise. “I saw people flopping around, only getting some of the information. And if they landed with the wrong person they got the wrong information,” Burke says. He realized that there were plenty of prospective buyers, but many were afraid to make a commitment. Many more were simply mystified by the perceived complexity of purchasing offshore property.
Following the classic “find a need and fill it” rule of business start-ups, Burke conceived Tropical Pathways. The company organizes small (typically no more than 15 people) investment/lifestyle tours targeted to people from North America and Europe who want to buy a piece of paradise. Some are looking for a retirement home. Some are looking for an investment property. All are desperately in need of good advice.
Burke makes it very clear to prospective travelers that his investment tours are not vacations. They are information-gathering, working tours, currently to four hot or soon-to-be-hot Caribbean destinations: Roatan, Panama, Mexico’s Riviera Maya, and the Dominican Republic.
A week-long, “Local Real Estate 101” course — that’s basically what Burke offers in each of these destinations. “We have an agenda,” he says. “The days are very full. We go through layers of information.” Every tour begins with a half-day investment strategy seminar that covers everything from healthcare to communications options, from the legalities of buying real estate in that specific destination to managing one’s banking and mortgages.
The groups meet with leading lawyers, developers, local business people, real estate people, and expatriates currently living in the destination (including folks who bought through a Tropical Pathways tour). Of course, the local sights are also on the itinerary. Prospective buyers in Panama, for example, tour the canal and the areas once occupied by the American military. But most of the week is spent looking at real estate developments.
For Panama, that includes high-rise condominiums and apartments in Panama City; residential and golf communities just outside of town; a flight to the Pacific coast to explore the yet-to-be-significantly-developed Bocas del Toro area, a web of small islands on the edge of the Caribbean; Pacific beach developments elsewhere on the coast; and the mountain town of Boquete, with its breezy climate (Burke owns a farm there).
Burke is very enthusiastic about Panama, he says, because 90 percent of the land is free open title, making it just like buying land in the U.S. “It is the next Costa Rica, with much better infrastructure,” he adds, noting that Panama also has a superb program for offshore retirees, which includes everything from half-price internal flights to low-cost quality health care to discounted movie tickets.
In smaller destinations, such as Roatan, the itinerary includes a broad range of waterfront developments in every corner of the island. In the Dominican Republic, long popular with Europeans but still an emerging market for Americans, the focus tends toward the North Coast, where bargains abound. Burke mentions a three-bedroom vacation home on close to three-quarters of an acre for US$77,000.
The Mexico Riviera Maya tour covers Cancun, Cozumel, the tiny island of Isla Mujčres (groups tour it by golf cart) and, farther down the coast, the newly popular markets of Playa del Carmen and Tulum. Burke notes that prospective purchasers who come to Mexico often fail to realize that laws regarding owning waterfront property have changed. Until recently, only Mexicans could buy land along the beach. Americans can now own waterfront property through fideicomiso, a long-term trust — done through a local bank — that lasts 50 years and is renewable in perpetuity.
The Way It Works
Burke says that he basically sells his Tropical Pathways Tours at cost: currently $990 per person or $1,498 per couple/double occupancy for the Dominican Republic; $1,249 per person/double occupancy for Panama and Roatan, with a $150 single supplement; and $699 per person for Mexico. That price includes internal flights; transfers; breakfast and lunch daily; cocktail parties to meet local experts and ex-pats (the Panama trip includes three of these); presentations by local lawyers, bankers, healthcare experts, and others savvy about the local scene; and the assurance that they will be shown quality real estate offerings.
Burke points out that he is not, after all, in the tour business. He is in the real estate business. He makes his money from commissions paid when group members buy in one of the projects that he shows them.
“I tell this to everybody on day one,” he says. “I basically make them a promise. ‘No one will pressure you to do anything.’ I don’t have to pressure people. Basically, I am selling them the country. The developments sell themselves.”
“This is NOT time share,” he emphasizes. “We expose people to a lot of good projects, in diverse locations, at diverse price ranges. And we do make money when they buy. I am very honest about that.”
Who Goes There
Lyle Burke says that typical Tropical Pathways travelers are … people just like him. That means folks in their fifties who have achieved a certain financial security, who have raised the kids and are now looking toward retirement, a vacation home, or diversifying their investment portfolio. “My goal is to get people to a safe portal. To minimize their risk. To lead them to good investment opportunities,” he sums up.
That worked for Tex Ball, who found Tropical Pathways on the Web, went to Panama, and was pleased that “Lyle and his assistants were very informative, very open to all questions, presented all sides of the equation — the good, the bad, and the ugly.” Ball says that his trip really felt like a vacation that “happened to turn into some business.” He made a commitment to buy; then brought his wife down to see the property, “and she fell in love with it as much as I did.” They still own it.
Ball was not alone. He says that half of his group made refundable deposits on property in Panama. Marcus Roehmer also reports that almost 50% of people traveling with Tropical Pathways ultimately purchase. “I have recommended Lyle’s organization for years and have had clients and friends also purchase real estate in Mexico and Panama because of the insight that Tropical Pathways provided them,” he concludes. n
FOR MORE INFORMATION: Contact Tropical Pathways at Tel: 830-980-5936; E-mail: firstname.lastname@example.org; Website:www.tropicalpathways.com.
PURCHASING PARADISE — Travel Tips
•The Numbers. Numbers are hard to quantify, but according to Delores Conway of the University of California’s Lusk Center for Real Estate, “Americans, especially baby boomers, are pursuing unique experiences, and vacation homes outside the country are part of that trend.” The U.S. Census Bureau and the U.S. State Department report that at least three million Americans lived abroad in 2000, with the number increasing annually.
•Retirees Only. The Social Security Administration sends nearly half a million checks out of the country every month. While some of these go to foreign workers who stayed in the U.S. long enough to receive benefits, many go to ex-pat retirees.
•Do Your Research. The U.S. State Department advises anyone intending to live abroad to first get information from U.S. citizens who already live in the destination, and also to contact the U.S. Chamber of Commerce, which exists in many countries. The investment firm of Merrill Lynch suggests that prospective overseas buyers rent first.
•Health Matters. Medicare does not cover hospital or medical services outside the United States. The Department of Veterans Affairs will only pay for hospital and medical service outside the U.S. under limited circumstances. The State Department advises that Americans moving abroad investigate how the locals pay medical bills and try to obtain similar coverage.
•Financial Matters. Merrill Lynch notes that value of overseas real estate depends significantly on currency fluctuations. When the dollar falls, a foreign home increases in value, but when the dollar rises that bargain disappears. They caution buyers to purchase only by fee simple title, in order to avoid other parties being able to claim title. Another need-to-know item: foreign bank mortgages tend to be shorter, perhaps ten years, and the rate is typically reset every year. Investors should also speak to a financial advisor to find out how to avoid dual taxation when they live abroad.