Excluding Venezuelan nationals, foreign visitor numbers grew by 10.9%, reaching 3,157,951 compared to 2,847,393 over the same timeframe in 2023. Returning Colombian residents also increased, with 1,264,145 arrivals, a rise from 1,149,097 in 2023.

The United States continues to be the primary source of foreign visitors, accounting for 27.1% of international arrivals, followed by Mexico, Ecuador, and Venezuela.

Regional Destinations

Bogotá remains the leading destination for international visitors, attracting 37.4% of total non-resident arrivals from January to September 2024. Other popular regions include Antioquia, Bolívar, and Valle del Cauca.

In September alone, Colombia saw 338,098 non-resident foreign visitors, representing an 8.3% increase from the 312,056 arrivals in September 2023.

Government Initiatives and Minister’s Statement

Minister of Commerce, Industry, and Tourism Luis Carlos Reyes Hernández, commented on the country’s strategy to strengthen non-traditional destinations through community-based tourism projects. “The government’s efforts are drawing international visitors interested not only in our biodiversity and cuisine but in cultural and peace-centered experiences throughout the regions,” he said, emphasizing the country’s aim to lead in inclusive and sustainable tourism development.

Air Travel Connectivity and Passenger Movement

Air travel data from Aerocivil underscores the growth in passenger movement, with 36.5 million air passengers between January and August 2024, marking a 16.6% increase compared to the same period in 2023. Of this total, 21,396,807 passengers traveled on domestic flights, while 15,127,233 were on international flights.

Domestic air travel saw a 13.7% rise, while international travel increased by 16.3% over the period. Pereira reported the largest growth in domestic passenger arrivals at 34.2%, followed by Bogotá at 20.9%. Among international destinations, San Andrés saw a 61% rise in arrivals, and Cúcuta recorded a 38.9% increase compared to 2023.

Tourism Promotion Campaign

The “Colombia, El País de la Belleza” campaign has played a role in enhancing the country’s visibility on the global stage, insists the minister. “Our campaign has positioned Colombia as a well-known destination with much to offer, contributing to the rise in visitor numbers,” Minister Reyes added. The government aims to continue strengthening all aspects of the tourism value chain to meet the needs of non-resident visitors and support a diversified tourism offering.

Bogota photo courtesy of Cushman & Wakefield.

According to the firm’s Market Beat report, the average rental price per square meter decreased 3% in Q2 compared to Q1 overall, but with significant decreases of 8% in the Avenida Chile financial district and 9% in the Nogal / Andino sub-market further north towards the city’s international district.

“What we have identified is that given this situation, some owners have tried to improve the price conditions of some of their properties,” says Juan Carlos Delgado, country manager for Cushman & Wakefield.

Against the backdrop of the Coronavirus COVID-19 Pandemic, several new real estate projects are expected to come online in the 2^nd half of 2020, including the Airport Business Hub, Connecta Gold 8 & 9, Sequoya, and the Atrium Tower.

Office inventories were up 16% than Q1, exacerbated by 10,230 square meters of new office space in the city’s high-end Chicó neighborhood, primarily in the FIC 92-11 building, left vacant by the COVID-19 lockdown.

“There are 215,000 m² under construction, represented in nine projects, of which 36% is on Calle 100 and 30% in the (city) center, while in the Northwest , Santa Bárbara and Av. Chile sub-markets, no Class A project is under construction,” says Andrea Duque, manager of market research at Cushman & Wakefield. “What is interesting is that the Atrium Tower, Sequoya, the Gold 8 and 9 towers of Connecta and AB Hub, among others, are expected to be fully operational for the second semester.”

There is a further 543,212 m² of leasable Class A office space in the development stage, of which 42% would be located in Salitre near the airport, and in the future this would add 230,000 m² to the current inventory in this area, with another 16% or (89,429 m²) in the city’s northwest outside of the primary business districts, according to Duke.

On the above graphic provided by Cushman & Wakefield of Bogotá’s primary Class A office districts, North is to the left, and East is to the top of the image.

With a new executive director, Colcapital, Colombia’s private equity industry association, continues to grow, as evidenced by the expansion of their annual event from the Colombian Private Equity Congress to the Private Equity Congress of The Pacific Alliance.

Colcapital Executive Director Paula Delgadillo Sanz de Santamaria

After investment roles with Colombian insurance concern Seguros Bolivar and Bancolombia, Paula Delgadillo Sanz de Santamaria took over the reins of Colcapital from Isabella Muñoz, who moved back into a business role with an investment firm.  The “gremio” or trade association continues to grow along with Colombia’s nascent private equity sector.

This year’s event saw speakers from small boutique firms as well as partners and executives from Blackrock, the International Finance Corporation, Bancoldex, Baker McKenzie, Skandia, Bancolombia, Cushman & Wakefield, and dozens of others. Conference topics ranged from real estate finance to impact investing.  Technical topics were covered, such as secondary transactions and infrastructure financing, but also ESG topics such as gender equity in capital markets.

3rd Annual Private Equity Congress of The Pacific Alliance was

In order to size the office market in each of the cities, the ratio of square meters of offices per 1,000 inhabitants was calculated. From this analysis, it turned out that Santiago de Chile leads the ranking with a ratio of 234, followed by Bogotá with 167, Lima with 161, Sao Paulo with 151 and Buenos Aires is in the lowest position, with 96.

According to the specialists at Cushman & Wakefield Southern Cone, the number of office buildings that a city holds, is useful to measure and understand the amount of investment in long-term assets for each country, and the conditions of the financial system, since capital-intensive investments depend highly on it.

Bogotá and Lima in the footsteps of Santiago

The study shows that Santiago de Chile has an inventory of premium offices of 1.67 million square meters, which exceeds the inventory of Lima, Bogotá and Buenos Aires, given that this market offers very good conditions for long-term investment. This translates into good accessibility to financing sources and a stable market, the main attraction for making this type of investment. In addition, Chile has a very solid savings system based on the AFPs, which must be invested locally, and provides greater drive to the demand for long-term assets.

Andrea Duque, head of research for Cushman & Wakefield

However, this solid savings system is a barrier to foreign capital entrance, added to the fact that the return on investment in capital-intensive assets is still low. This could limit the growth of the market, and make local investors to look for other markets with similar investment conditions.

Lima is currently positioned as one of the most important emerging office markets in South America, behind Santiago de Chile, an established continental market. It doubled its office inventory in the last five years, reaching 1.58 million square meters. A consistent economic policy, with relatively low funding rates, supported long-term investment.

Andrea Duque, Head of Market Research at Cushman & Wakefield Colombia, says: “Bogotá shows development similar to Lima. The Class A office inventory registered a growth of 57% in the last five years, reaching 1.43 million square meters and on top of it all, the city recorded in 2018 an important demand for this kind of spaces, driven by a context of investor confidence. ”

Sao Paulo and Lima lead in built meters, and Buenos Aires in projected meters

The data collected shows that between 2014 and 2018, Sao Paulo and Lima were the cities that had the largest new surface production, followed by Bogotá and Santiago. Buenos Aires has been left behind not only by the unstable political and economic conditions of recent years, but also because financing for long-term investments is very scarce. The office market is capital-intensive and financing is required to develop new projects.

Buenos Aires has the largest volume of meters under development and planned for the next five years, which validates the potential of the office market for developers. However, although it has the largest amount projected, it is combined with the lowest amount produced, given the difficulties that investors have to carry out their projects in a market without financing.

On the other hand, when observing the market cycle, Buenos Aires is in a state of “High rental prices” with an average of US $ 33 square meters / month. This is partly preserved by the small size of the inventory of Premium offices. However, political and economic instability are impacting the income level, which begins to decline and provides future opportunities for tenants.

“Bogotá presents stable rental prices and in some cases decreases, with an average of US $ 20.2 square meters / month. This situation is ideal for tenants who need to renew their contracts, for those looking for properties to rent, to expand their offices or willing to move to a building with better features,” said Juan Carlos Delgado, Country Manager of Cushman & Wakefield Colombia.

Juan Carlos Delgado, Country Manager of Cushman & Wakefield Colombia

The markets of Santiago, with an average rental price of US $ 19.5 square meters / month, Sao Paulo, with an average rental of US $ 23.6 square meters / month, and Lima, with an average rental of US $ 17, 3 square meters / month, have slowly growing rental prices, which could lead in the future to an opportunity for investors.

Santiago and Buenos Aires have the lowest vacancies

When comparing the vacancies of each one of the cities, it can be noticed that Santiago holds the lowest vacancy rate with 4.3%, after a period of five years with little production and large developments that are still waiting to be finished. It is followed by Buenos Aires with 6.3%, a vacancy that remains low, as a result of a structurally small market. Bogotá (9.9%), Lima 20.2%) and Sao Paulo (21.6%) have higher vacancies, but with a downward trend

Additional Data

These report findings were shared with Finance Colombia by Cushman & Wakefield.

Marc Royer is responsible for the new business unit of Capital Markets for South America of Cushman & Wakefield, a global corporate real estate services company present in Colombia. This appointment seeks to potentiate the local and cross-border investment opportunities of the South America region,and the company expects Royer to lead this effort.

Royer has a degree in business administration and management with a Master in International Management from IPAG Business School, in Nice, France. He has 16 years of experience in the real estate investment industry in Europe and South America with nearly USD 2 billion in volume of transactions. He was a partner of 3Di, boutique consultancy platform, specialized in buying, selling and developing commercial assets in the region. He previously served as Director of Transaction Services and Capital Markets of CBRE Chile, advising real estate transactions by investment volume, exceeding USD 950 million in Chile and Peru, leading the sale for Walmart of the largest real estate portfolio in Chile (10 malls Urban Space ). He was also Senior Investment Manager at CBRE Spain and Investment Manager at Banco Santander, where he invested nearly 700 million in assets and real estate funds in Germany, France, Belgium, Poland, Slovakia, Czechoslovakia, among others.

Class A offices (which include sub-classes AAA and A), the only ones monitored in this study, are the highest quality of office space with premium standards that support not only issues such as sustainability, but also are attractive to multinational firms entering the Colombian market who tend to  seek this type of property, according to their commitments of quality, efficiency and safety.

• The record figure corresponds to Bogotá offices, the most internationalized market in Colombia, which is projected to continue growth in 2019.
• The increase is the highest in 8 years.
• Occupancy had its maximum and historical peak in the third quarter with 76,181 m2 (820,000 square feet).
• The Salitre corridor near the El Dorado International Airport has the highest leasable area at 41.9% of the Bogotá market.

The highest absorption index for the year was in the third quarter of 2018, when it reached a historic figure of 76,181 m2, corresponding to 41.8% of the annual total. Likewise, data on the area occupied in 2018, compared to 2017, suggest a growth of 39% in absorption, a record that shows an increase in demand and improvement in the economy from at least a real estate perspective.

Economist Andrea Duque Gaviria is the head of valuation and advisory for Cushman & Wakefield in Colombia

According to Andrea Duque of Cushman & Wakefield, 950 m2 were also released in this period, 6% less than in 2017, while inventory increased by 9.3% compared to 2017 , and the vacancy rate (area available for rent), only recorded a decrease of 4.3% percentage points, adding to the good prospects of this sector and a balanced development of transactions.

In the fourth quarter of 2018, the capital city presented an availability of 141,732 m2, located at 81% in the Central Business District, (CBD), which corresponds to the metropolitan areas of Avenida Chile, Calle 100, Centro, Chicó, Nogal-Andino, Salitre and Santa Bárbara, where the vacancy reached only 8%.

The Salitre corridor concentrated 41.9% of the available surface, followed by the Noroccidente (Northwest) corridor (18.9%), which corresponds to a non-traditional corporate zone, (NON CBD), which includes projects such as Colina Centro Empresarial or Floresta Business Center, while the sub-markets with less availability were Avenida Chile, Calle 100 and Centro (Traditional Downtown).

The net absorption of the quarter was 22,668 m2, where the Salitre submarket stood out with 47.8% of the total, supported mainly by the area taken in the Central Point and Elemento buildings.

The price rent requested, very much in accordance with the location and characteristics of the building, remained at an average of $ 64,000 pesos per square meter, which measured in dollars, shows a downward trend. It is necessary to clarify there that the price of rent requested in the zone NON CBD, is 7% less than that of the CBD zone, opening possibilities of location in non-traditional areas, but with high possibilities of development.

By 2019, the Cushman & Wakefield study projects that 319,411 m2 will correspond to 19 Class A buildings that are 83% located in the CBD, 30% in the Cll 100 submarket and 27% in Salitre.

“In addition, other future buildings are planned, which still have no delivery date, but which would add some 400,000 m2, located at 86% in the CBD area,” says Duque.

This area in project and construction phases would increase by 46.4% compared to the historical average of new annual square footage delivered, a rate expected to sustain the process of development and investment in the country.

Class A buildings (A + and A) are those buildings with high technical and safety specifications, with an age between zero and ten years; with leasable area from 1,000 m2 to 1,500 m2; between one and four offices per floor; heights up to 2.70 m, holders or in process of sustainability and environmental certifications such as LEED or AQUA and strategically located in areas with easy access and roads.