Ortega comeback in Nicaragua scares US residents

GRANADA, Nicaragua, Nov 5 (Reuters) Former Marxist guerrilla Daniel Ortega's attempt to return to power in Nicaragua has sent shivers up the spines of American residents who fear their quiet lives in a tropical paradise is under threat.

The left-wing Sandinista leader is leading opinion polls for today's presidential election, and US realtors selling villas and retirement homes in and around the colonial city of Granada foresee a slump in business if he wins.

A Cold War foe of Washington, Ortega's new friendship with Venezuela's anti-American President Hugo Chavez has many scared he could upset US relations again if elected.

''We're just waiting for the storm,'' said property developer Terry Rogan, 50, who is halting building work on a luxury villa overlooking a glassy lake in the crater of a former volcano because of a lack of buyers.

''I've just laid off my workers because there's nothing going on.

I've got four houses for sale, and a lot riding on this. But if Ortega wins, who's going to come here and get a warm fuzzy feeling about investing?'' he said.

Some 6,000 Americans live in Nicaragua, many of them wealthy retirees who have settled in recent years, attracted by the climate, lush scenery and cheaper real estate than in other retiree destinations like Costa Rica and Mexico. Many have spent their life savings to buy property in Nicaragua.

Ortega says he has mellowed since the Sandinistas seized property from the rich in a 1979 revolution and then fought US-backed Contra rebels in a decade-long civil war.

In opposition during 16 years of conservative governments, Ortega says he wants to end ''savage capitalism'' but is not an enemy of the markets and foreign investment. He has made no threats against the US residents.

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