A Place Called Asia, in Peru, Has Boom of Its Own


From Friday to Sunday, middle- and upper-class neighborhoods in the Peruvian capital, which has a population 7.6 million, empty out as residents head to the blossoming string of coastal developments that surround the satellite city of Asia and its shopping boulevard.

As Peru’s economy continues to build on more than a decade of continuous growth, the construction of second homes to the south of Lima has exploded. The shopping area at Kilometer 97.5 opened in 2003 with dozens of stores and seasonal versions of many of the restaurants and clubs frequented by Lima’s wealthy.

“There are over 24,000 vacation homes in the southern beaches of Lima,” said John Reynolds, president of Revolutions Peru. “They continue to grow at around 2,000 per year now with new projects.”

Revolutions Peru is a property development company involved in numerous projects south of Lima, including Las Terrazas, a 96-home community attached to Vista Pacifico, a $35 million Best Western Premier Resort Hotel expected to open in January 2013.

Finished homes at Las Terrazas sell for $300,000 to $1,600,000. Owners are promised year-round, 24-hour services and support from the hotel, including security, housekeeping and landscaping. (Real estate in Peru is advertised and sold in U.S. dollars.)

Residents of Lima, whose municipal beaches are crowded and heavily polluted, are snapping up coastal property everywhere from Kilometer 27 to Kilometer 150.

“They are selling very fast — around 15 units per week,” Nella Pinto, general manager of Peru Sotheby’s International Realty, said about Plaza Azul, a 180-lot residential development at Kilometer 127. “We have had to increase the price twice in the last two months.”

She said some owners who bought lots for $60,000 early in the development’s history, and then built houses for about $120,000, can now sell them for as much as $600,000. “Everyone wants to keep the value increasing,” Ms. Pinto said.

While the Asia district includes about 30 beach developments, from Kilometer 62 at Chilca to Kilometer 131 at Cerro Azul, it is centered on the shopping boulevard, where availability is limited.

The dune-filled coastline gained global recognition as the finish line of the Dakar Rally in January, though it has long held international attention. The Beach Boys even sang about the town of Cerro Azul, at Kilometer 131, in the song “Surfin’ Safari.”

Many buyers are coming from neighboring South American countries including Chile, Brazil, and Argentina, as well as from North America and Europe. There are also a significant number of Peruvians returning home from abroad to invest. (Peruvian law places only a few restrictions on foreigners wishing to buy property, like a ban on sales within 50 kilometers, or 30 miles, of the land borders.)

Homes in top developments, which usually are built of stucco and glass, average $1,000 to $1,500 per square meter, or about 11 square feet. Prices range from $200,000 to $600,000 per house, although prices are increasingly surpassing $1 million. Many opt to rent out their purchases, as the returns can be substantial.

“It is very, very expensive to rent,” said Carsten Korch, a Dane who relocated to Peru in 2005 and now publishes Living in Peru, a Web site and newsletter for the country’s growing international community. “For a nice house it’s about $5,000 per month or $15,000-20,000 per season.”

In 2011, Mr. Korch purchased a lot at San Antonio, where Club de Regattas, an organization based in Lima, is adding a residential segment to its members-only beach facility.

Apart from the exclusivity of the beach, it was the association rules, or lack thereof, that finally convinced him.

“Some communities don’t allow dogs,” Mr. Korch said. “This did. It was the opportunity where we could bring the entire family. Dog included.”

Most developments require every homeowner or renter to go through an intensive review process that many real estate agents liken to New York co-op boards. Some development boards have become known for their stringent rules, like not allowing household workers on beaches without uniforms, although many appreciate the regulations because they help maintain property values.

When summer ends, Asia becomes a ghost town. But the Peruvian government recently added eight holidays to create extended weekends and help promote travel. The Ministry of Trade and Tourism predicts that each new holiday will create an extra $100 million in national tourism.

“Five years ago, people would only go during January, February and March, but only during the weekend,” Mr. Korch said. “I think Asia is turning into a place where people will use a house more and more.”

Mr. Reynolds, the president of Revolutions Peru said, “We expect to see a million people living in the south beach areas in a 10-year period.”