There's this repeating charity auction item that Helaine Williams, Cary Jenkins and I have been talking about. It's a one-week stay at a villa in Costa Rica -- infinity pool, housekeeping staff, breezes so solicitous the whole back of the house is windowless -- and it has been auctioned at events as diverse as Ragin' Cajun Bash for CARTI, Once Upon a Time for United Cerebral Palsy of Arkansas, Tie One On for Our House, Soup Sunday for Arkansas Advocates for Children and Families, and others.
The villa actually sold three times at Soup Sunday last month in Little Rock, each one for $4,900. It sold three more times a few weeks later at the Soup Sunday up in Fayetteville, for $5,500 each, bringing the total raised to $31,200. That's roughly an eighth of Arkansas Advocates for Children and Families' fundraising total, so "it made a real difference to our success," said development director Mallory Van Dover. "It was a good year."
Until then I'd not noticed the reoccurring auction item. Lots of area events auction four-figure items, and beach vacations are common. (More common still are dinner parties. Less common are cars.) A photo exactly like the one on 8D popped up on the big projector screen inside the ballroom at Soup Sunday in Little Rock, and I happened to be talking to Jordan Johnson, and he said something like, "Oh, cool, we're going there."
I said, "Costa Rica?"
He said, "Yeah, but there. That place."
I must've asked how that can be, since it was presently being auctioned. Nah, that vacation flits about the event circuit, he said. Two weeks later I was on the phone with Kelly Fleming at the Arkansas Arts Center, who told me she and husband Shannon were leaving shortly for Costa Rica.
"Not for a villa with an infinity pool?" I asked.
"That's the one!"
Turns out it has been auctioned to benefit everything from Pulaski Technical College and JDRF (formerly Juvenile Diabetes Research Foundation) to Annunciation Greek Orthodox Church in west Little Rock, and it's quite an interesting operation.
THE OPERATION
The co-owner who spoke to me is Eric Kaiser of Dallas, who spent part of his childhood in Little Rock (one of his brothers lives in Maumelle). He and maybe half a dozen others bought into this place a decade ago. They wanted to make a foreign real estate play "not tied to the U.S. stock market or local real estate market," and if it doubled as a destination vacation, all the better. (Kaiser's wife is Costa Rican.)
They found Vista Magnifica. As a vacation spread, "it's the most unique house you'll ever see." As a rental property it under-performed. "Not that many people want to rent for whatever reason," Kaiser says. "It hasn't gotten on the U.S. radar for whatever reason."
So about 2007, one of the partners donated a week's stay to his church to auction. It made a lot of money, and "turns out, the people who go to these auctions, they're very generous individuals."
Why?
"Because they can actually rent the house for less than they pay at auction," Kaiser says.
The commercial rate for such a place in such a locale is roughly $4,000 a week, but the auctioned rental fetches two, 21/2 times the rental price, on average, and Vista Magnifica is in auctions from Dallas to Chicago.
"Well, those types of people are very special, very generous, loving people -- so as you might guess, they're very polite guests," Kaiser says.
That's important, because some of the unpleasant surprises of Third-World home-ownership are repairs and capital improvements -- way more expensive than similar work in the United States. A decent barbecue grill there might run $1,000 (U.S.). Last month, Kaiser said he spent $8,000 just on maintenance.
So how can they afford to throw this up on auction blocks every few weeks?
That's where the story gets more interesting. The ownership group is not eating the costs of someone else's one-week stay. They're taking a cut of it, and not a small one -- $2,500. This is pretty unusual, and Kaiser says many nonprofits recoil at these consignments, "and I say, 'Well, I just can't do that. I'm sorry. I'm giving you a huge discount.' You know, we're just regular working stiffs ourselves" -- he's an engineer -- "and we can't afford to spend $80,000 a year down there and fill it up with nonpaying customers."
(I must say at this point that Kaiser's candor is pretty unusual, too, and commendable.)
VISTA DINERO
He has never marketed this part of the trade, and his calendar of auctioned weeks is full. Recently, in Dallas, a week's stay grabbed $18,000 at charity auctions -- twice. Last year, when at a Meals On Wheels fundraiser it fetched just $3,000, the owners took only a $1,500 cut.
Since 2008, when the ownership group made charity auctions a "concerted" part of the business, Kaiser says Vista Magnifica has generated about $700,000 for others, and that's "just on the U.S. side."
He sums up the economics this way:
"The first part of the equation is this phenomenon for local charities. The second part of the equation is, I get guests who are really top-notch people who take care of the property like it's theirs. The third, and very important part, of the equation is, when those types of people show up in the little town of Potrero, Costa Rica, my local pueblo down there, they're very generous people. They're spending a lot of money on horseback riding, catamaran tours, nature hikes."
A group of 10 vacationers might drop $10,000 on the local economy there, a "total capitalist economy," by which he means low-overhead service enterprises. Over time, these amenities will improve, and with it, public works projects. Already, Jordan Johnson said he was impressed with the quality of the roads, and the airport "has been redone in the past couple years."
The service will improve and expand. Bars will open, sailboats will slip by and beaches will blossom. The north Pacific corner of Costa Rica will go all Cayman, and the vistas will be worth fistfuls, and wouldn't that be muy Magnifica?
Rent space in my inbox this spring:
bampezzan@arkansasonline.com
High Profile on 03/20/2016