Ever More New Condominium Projects

Pictured are three of the better condominium towers built during the last flurry of construction in Punta del Este a few years ago. They are, from left to right, the Coral Tower, the Beverly Tower, and the Millenium Tower, located across the street from the Playa Mansa and right next to the Hotel Conrad. Today, another boom is in full swing, the biggest ever. According to a front-page article today in the major Montevideo newspaper, no less than 27 new buildings in various stages of construction will be on sale for the first time this season. This is in addition to many, many more that debuted over the past two seasons.

Who's building? According to the paper, mostly the Spanish, who believe they can realize 30% return immediately. According to a few friends from this area, the real financing comes from dirty money, some from Spain for sure but much more from illicit operations within South America. Only "The Shadow" knows for sure. Who's buying? Again according to the paper, it's 60% Argentineans, 25% Europeans, 10% Uruguayans, and 5% Brazilians and Paraguayans. But the real question is whether, at the end of the day, anyone is going to buy all of these new apartments -- at least, at prices that will yield 30% return to the investors. Half of these new buildings are the size of the three towers pictured, or larger. (The other half are only four to five stories, with one or two huge apartments per floor.) The selling prices run from around U$S 1800 to more than U$S 3000 per square meter, and because many of these apartments are really big, prices of some run into the millions of dollars. As the paper notes, and local real estate agents always include in any spiel, that's well below prices in Miami, and even further below prices in Madrid. But somehow, at least to this non-expert, comparing the potential market for an isolated stretch of beach in the far reaches of South America, with a season of two months at most, to the market for southern Florida or the European continent is . . . well, how does one say it -- hallucinating? Let's all hope my concerns are unfounded.