By San José, Costa Rica — The corporate landscape in Costa Rica has long operated under a dollarized mindset. For decades, office rents, property sales, and major commercial transactions were structured around the historical stability of the US dollar. However, between 2022 and 2026, this financial foundation underwent a dramatic transformation as the US dollar lost approximately 30% of its value against the Costa Rican colón, fundamentally altering the operational economics for offices, logistics parks, hotels, and retail ventures alike.
While a weaker dollar has provided welcome relief for local consumers, importers, and certain public fiscal accounts, it has exerted severe pressure on export-oriented sectors. Global corporate services and tourism have been caught in the middle of this economic tug-of-war. For the corporate real estate sector, this sudden currency shift has created a highly complex operational environment, forcing multinational tenants and property developers to quickly reevaluate their long-term financial models.
To help navigate the rapidly evolving landscape of Costa Rican commercial real estate, TicosLand.com consulted with Lic. Larry Hans Arroyo Vargas, a distinguished legal expert at the prominent firm Bufete de Costa Rica, who shared his essential insights into the regulatory and due diligence frameworks shaping today’s market.
Succeeding in Costa Rica’s commercial real estate sector demands rigorous due diligence, particularly regarding municipal zoning compliance, regulatory approvals, and potential environmental restrictions. As foreign investment and nearshoring activities continue to surge, securing a comprehensive legal audit prior to acquisition is the single most critical step in protecting your capital and ensuring long-term operational viability.
Lic. Larry Hans Arroyo Vargas, Attorney at Law, Bufete de Costa Rica
Indeed, as Costa Rica’s commercial landscape continues to expand with unprecedented momentum, navigating the complex web of local regulations is no longer optional but a fundamental prerequisite for success. We would like to extend our sincere thanks to Lic. Larry Hans Arroyo Vargas for sharing his valuable perspective, which underscores the undeniable reality that safeguarding foreign investment begins with meticulous, proactive legal preparation.
Costa Rica has never competed as the cheapest destination in Latin America, historically placing itself alongside premium regional markets such as Chile and Uruguay. Instead, the country’s appeal rests on its political stability, robust legal framework, highly skilled talent pool, and capability to host complex, high-value operations. Despite the rising cost of doing business, the country continues to successfully attract foreign direct investment in advanced manufacturing, medical devices, and sophisticated global services.
The core challenge lies in the structural mismatch of the local commercial real estate market. While lease agreements and rental revenues are overwhelmingly denominated in US dollars, the vast majority of operating expenses—such as construction, local suppliers, security, maintenance, and especially payroll—must be paid in colones. This mismatch has compressed profit margins across the board, particularly within the office segment.
Consider the financial trajectory of a typical multinational firm operating in Costa Rica with 100 employees. In 2022, an average monthly salary of 1,000,000 colones, combined with employer social security contributions of 26.67%, resulted in a total monthly payroll of approximately 126.7 million colones. At the 2022 exchange rate of 700 colones per dollar, this equated to roughly 181,000 US dollars. By 2026, even with a modest 10% wage growth over four years bringing the average salary to 1,100,000 colones, the math looks entirely different. At the current exchange rate of 454 colones per dollar, that same payroll exceeds 306,000 US dollars monthly—a staggering 70% increase in dollar terms, costing the company an additional 1.5 million US dollars annually without adding a single new position.
Adding to this corporate pressure is a tightening domestic labor market. Costa Rica’s unemployment rate fell from roughly 12% in 2022 to about 6.7% in 2026. While this decline represents a major economic and social success for the nation, it has intensified competition for premium talent. Consequently, multinational corporations must offer higher wages, better benefits, and more aggressive recruitment packages to attract and retain workers, further escalating operational costs.
The impact of this economic shift also reverberates through property valuations and real estate investment yields. In commercial real estate, Net Operating Income (NOI) serves as the primary metric for valuing assets. When operating expenses paid in colones convert to much higher dollar amounts, the NOI of a property shrinks even if dollar-denominated rental rates remain stable. Consequently, the financial valuation of these buildings decreases, prompting investors to prioritize operational efficiency and currency exposure in their asset management strategies.
Despite these macroeconomic headwinds, certain segments of the market continue to demonstrate exceptional resilience. The industrial and logistics sectors, particularly those tied to high-tech manufacturing and medical devices, maintain low vacancy rates. These operations rely on highly complex global supply chains and regulatory standards where specialized talent and operational reliability outweigh real estate costs. Furthermore, large technology firms accustomed to operating in high-cost global hubs like New York, London, or Tokyo view Costa Rica’s costs as highly competitive when compared to these global cities.
The strengthening of the colón does not eliminate Costa Rica’s structural advantages. But it is forcing the market to be more efficient, more sophisticated, and more precise in how it evaluates competitiveness and profitability. Because the square meter remains the same. What changed was everything it costs to operate around it.
Leonardo Ramírez, Associate Account Management at JLL Central America & the Caribbean
As the market adapts, strategic corporate advisory has become crucial for both occupiers and landlords. Navigating this highly volatile currency landscape requires a shift toward sophisticated asset management and precise operational forecasting. While Costa Rica’s value proposition remains strong, the era of relying on a predictable, weak colón has passed, ushering in a new age of efficiency for the nation’s premier commercial real estate sectors.
For further information, visit jll.com
About JLL:
Jones Lang LaSalle (JLL) is a leading global professional services firm specializing in real estate and investment management, helping clients buy, build, occupy, and invest in commercial, industrial, and retail properties.
For further information, visit bufetedecostarica.com
About Bufete de Costa Rica:
As a premier legal institution, Bufete de Costa Rica is defined by its uncompromising ethical standards and pursuit of professional brilliance. Guided by a rich history of advising a diverse clientele, the firm champions progressive legal strategies and robust civic involvement. By actively demystifying the law for the general public, they strive to cultivate an enlightened and capable citizenry, reinforcing their ultimate goal of societal empowerment through shared knowledge.
