It's because the financial system in Panama is created in a manner that encourages ownership of assets through corporations or foundations. It's easy, it's inexpensive and there are tangible benefits to doing so.
If you're some goon like me and you own a property that you rent you'd likely want to structure the ownership to where it's corporate rather than individual. You'd want to do this for exactly the same reasons you'd want to do it in North America or anywhere else - liability. (Another consideration is that in many cases it's easier and cleaner to sell a property held by a corporation than one held by an individual.)
If you're the president of the country or his brother in law or his best friend or chief of staff or whatever you may wish to structure things that way in the interest of privacy.
There are also some real tax advantages in Panama when making transactions as corporation or a foundation but I'll leave the explanation of those advantages to others more qualified than I to give them.
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