Published on and written by Cyril Jarnias
Paraguay offers numerous opportunities for entrepreneurs looking to establish themselves in this South American country experiencing economic growth. Whether you’re seeking commercial space, an office, or a warehouse, it’s essential to understand the local real estate market and necessary procedures. This article will guide you through the key steps to find the ideal location for your business in Paraguay.
Secrets to Finding the Perfect Space in Paraguay
Finding a space suitable for your business is a crucial step in developing your company in Paraguay. To optimize your chances of success, here are some effective strategies:
– Hire a local real estate agent: Industry professionals know the market perfectly and can save you valuable time in your search. They often have access to listings not published online.
– Explore industrial and commercial zones: Paraguay has several industrial parks and free zones offering attractive tax benefits for businesses. Inquire about these opportunities with local authorities.
– Use online platforms: Websites like Clasipar.com or Encuentra24.com offer numerous commercial and industrial space listings for rent or sale throughout the country.
– Network with the business community: Participate in events organized by the Franco-Paraguayan Chamber of Commerce or other entrepreneur associations to get recommendations and useful contacts.
– Explore developing neighborhoods: Cities like Asunción and Ciudad del Este are experiencing rapid growth. Some emerging neighborhoods may offer interesting opportunities at more affordable prices.
Don’t hesitate to visit multiple spaces before making your choice. Consider criteria such as accessibility, visibility, surrounding infrastructure, and the area’s development potential.
Good to know:
In Paraguay, it’s common to negotiate rental prices. Don’t hesitate to discuss terms with the owner, especially if you’re considering a long-term lease.
Key Players in Paraguayan Commercial Real Estate
To facilitate your search for space in Paraguay, it’s recommended to work with real estate professionals. Here are some of the main agencies specializing in commercial real estate:
- Remax Paraguay: This international franchise has a strong local presence and offers a wide range of commercial and industrial properties.
- Inmobiliaria del Sur: A reputable agency offering comprehensive services for businesses looking to establish themselves in Paraguay.
- Paraguay Real Estate: Specializing in assisting foreign investors, this agency can help you find the ideal space and navigate administrative procedures.
- Casas Paraguay: An online platform aggregating numerous commercial and industrial space listings throughout the country.
- Inmobiliaria Raices: A well-established local agency known for its in-depth knowledge of the Asunción real estate market and surrounding areas.
These agencies can not only help you find the right space for your needs but also advise you on legal and administrative aspects of renting or purchasing property in Paraguay.
It’s recommended to contact multiple agencies to compare offers and services provided. Don’t hesitate to ask them about their experience with international clients and their knowledge of regulations specific to your industry.
Good to know:
Some agencies offer comprehensive support services, including space search, negotiations with owners, and assistance with administrative procedures. These services can be particularly useful if you’re unfamiliar with the local market.
The Winning Application to Convince Property Owners
To rent commercial or industrial space in Paraguay, you’ll generally need to provide several documents. Here’s a list of the main items to prepare:
- ID or passport of the company’s legal representative
- Business registration extract (RUC – Registro Único del Contribuyente)
- Company bylaws
- Latest company financial statements
- Business plan or description of planned activities in the space
- Bank references
- Financial guarantees (depending on owner requirements)
It’s important to note that requirements may vary depending on the owner and type of space. In some cases, a bank guarantee or security deposit equivalent to several months’ rent may be required.
For foreign entrepreneurs, it may be helpful to provide additional documents proving your company’s financial strength in your home country. A recommendation letter from a bank or business partner in Paraguay can also strengthen your application.
Preparing a complete and professional application will increase your chances of obtaining the desired space, especially in the most sought-after areas where competition can be strong.
Good to know:
If you’re creating a new company in Paraguay, some documents like financial statements won’t be available. In this case, a detailed business plan and personal guarantees may be necessary to reassure the owner.
Budget: How Much Does Renting Space in Paraguay Cost?
Rental costs for commercial or industrial space in Paraguay vary considerably depending on several factors, including location, size, and property condition. Here are some general guidelines to help you budget your project:
– Commercial spaces in downtown (Asunción): Between $10 and $25 per m² per month – Offices in business districts: From $8 to $20 per m² per month – Warehouses in industrial zones: From $3 to $8 per m² per month
It’s important to note that these prices are averages and can vary significantly depending on exact location, finish quality, and included services. For example, a well-located commercial space in the Villa Morra shopping district of Asunción can reach higher prices, while a warehouse in a peripheral industrial zone will generally be less expensive.
Besides rent, you should also consider other expenses:
– Security deposit: Generally equivalent to 1 to 3 months’ rent – Common charges: Variable depending on included services (security, maintenance, etc.) – Local taxes: To be verified with local authorities – Insurance: Mandatory for most commercial leases
It’s recommended to negotiate a long-term lease to obtain more favorable conditions, particularly regarding rent and improvements. Some owners may be open to arrangements, such as an initial reduced rent period in exchange for investments in space improvements.
Good to know:
Commercial real estate prices in Paraguay tend to increase, particularly in developing urban areas. It may be wise to include a margin in your budget to anticipate potential rent increases.
Emerging Cities: Where to Establish at Lower Cost?
Although Asunción, the capital, remains Paraguay’s main economic center, several other cities offer interesting opportunities for businesses, often at more affordable costs. Here are some destinations to consider:
Ciudad del Este: The country’s second-largest city, known for its commercial dynamism, particularly in electronics and cross-border trade with Brazil. Real estate costs are generally lower than in Asunción, while offering access to an important market.
Encarnación: This southern city is experiencing rapid development, particularly due to tourism and its strategic position on the border with Argentina. It offers interesting opportunities for businesses in commerce and service sectors.
San Lorenzo: Located in Asunción’s suburbs, this growing industrial city offers land and spaces at more affordable prices than in the capital, while benefiting from its proximity.
Luque: Also close to Asunción, Luque hosts the international airport and is experiencing rapid development of its industrial and logistics zones. It’s an interesting option for businesses requiring good connectivity.
Villeta: This city, located about 40 km from Asunción, hosts several industrial parks and offers attractive tax benefits for businesses, particularly in the manufacturing sector.
These secondary cities can offer significant cost advantages while providing access to skilled labor and developing infrastructure. However, it’s important to carefully evaluate the advantages and disadvantages of each location based on your industry and specific needs.
Good to know:
Some of these cities benefit from economic development programs that may include tax incentives or subsidies for businesses establishing there. Inquire with local authorities about available opportunities.
Government Support to Facilitate Your Establishment
The Paraguayan government, aware of the importance of foreign investment for the country’s economic development, has implemented several programs and incentives to facilitate business establishment. Here are some of the main available supports:
- Full exemption from customs duties on imported equipment
- VAT exemption on imported equipment purchases
- Income tax exemption for 5 years for investments exceeding $5 million
Maquila Regime: This program allows businesses to benefit from a single 1% tax rate on the added value of exported products, as well as exemptions from customs duties on imports of raw materials and equipment.
Free zones: Paraguay has several free zones offering tax and customs benefits, particularly in Ciudad del Este and Villeta. Companies operating in these zones benefit from full customs duty exemption and reduced tax rates.
Municipal incentives: Some municipalities offer specific incentives to attract businesses, such as reductions on local taxes or streamlined construction permit processes.
Support program for micro, small, and medium enterprises: Managed by the Ministry of Industry and Commerce, this program offers training, technical support, and financing facilities for SMEs.
To benefit from these supports, it’s generally necessary to present a detailed investment project to the competent authorities. It’s recommended to work with a lawyer or specialized consultant to navigate administrative procedures and maximize the benefits your company may be entitled to.
Good to know:
REDIEX (Red de Inversiones y Exportaciones) is the government agency responsible for promoting investments in Paraguay. It can provide detailed information about available support programs and connect you with the appropriate authorities.
Conclusion
Finding the ideal space for your business in Paraguay requires a methodical approach and good understanding of the local market. By following the advice presented in this article, you’ll increase your chances of finding the perfect location to develop your business in this country with numerous opportunities.
Remember that the key to success often lies in meticulous preparation and the ability to adapt to the specificities of the Paraguayan market. Don’t hesitate to seek help from local professionals, whether real estate agents, lawyers, or business establishment consultants, to guide you through your procedures.
Paraguay, with its sustained economic growth and investment-friendly policies, offers fertile ground for visionary entrepreneurs. By wisely choosing your location and leveraging available supports, you’ll lay solid foundations for your business’s success in this dynamic South American country.
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Cyril Jarnias is an independent expert in international wealth management with over 20 years of experience. As an expatriate himself, he is dedicated to helping individuals and business leaders build, protect, and pass on their wealth with complete peace of mind.
On his website, cyriljarnias.com, he shares his expertise on international real estate, offshore company formation, and expatriation.
Thanks to his expertise, he offers sound advice to optimize his clients' wealth management. Cyril Jarnias is also recognized for his appearances in many prestigious media outlets such as BFM Business, les Français de l’étranger, Le Figaro, Les Echos, and Mieux vivre votre argent, where he shares his knowledge and know-how in wealth management.
