GOOD NEWS! (not!)

a friend sent this to me recently:

New York Times article LORETO BAY

i'll paste the whole article below in case the link needs a password after awhile

so feel free to read it and then i'll come back in with another post explaining how the whole "eco" thing is a steaming pile of bullsh*t and how things are not so rosy for the actual locals who live in LORETO which is a different community altogether than the little resort town of LORETO BAY that is a few kilometers south of LORETO.

Mexico’s New Frontier

Adriana Zehbrauskas for The New York Times
SUN KISSED Many Americans are heading for Loreto Bay, a resort community that’s planning a total of 6,000 residences in the desert of Baja California.


By JIM ATKINSON
Published: March 7, 2008
THE 8,000 acres of the Loreto Bay Resort on Baja California snuggle on flat, hard desert between the charismatically craggy Giganta range and the spookily glassy Sea of Cortez. The most basic elements of nature — sun and water, rock and sand, the vertical and the horizontal — collide with that particular grace that only nature can produce.

From a footbridge that gently arcs over a deep green estuary leading from the bay into the development, there’s a good view of the resort taking shape on this once-isolated spot: a 150-room hotel with a beachside cafe and gardens; 240 two-story adobe houses with cupolas; some homes painted bright blue or yellow, others muted pink and beige or green; another 300 houses and condos in varying stages of construction.

But this is only a beginning. If the vision of the Mexican government and an American developer is realized, a decade from now Loreto Bay will include 6,000 homes, from small condos to 3,800-square-foot custom houses, most of them probably to be owned by American retirees or part-time residents. They will be formed into six groups called villages, themselves made up of clusters of five and six homes, each with its own small communal green space.

In the best tradition of the new urbanism, residents will travel about their villages on foot, by bicycle or in electric-powered golf carts, moving over flagstone streets purposely made too narrow for automobiles. They will have three golf courses, beach and tennis clubs and a marina at their disposal, with whale watching and other eco-tourism just a boat ride away. And everything will be built to the highest standards of environmental sustainability. The master plan includes not only solar-heated hot water, but a seawater desalination plant and a 500-acre wind farm.

The goals are so monumentally ambitious that it’s impossible not to ask whether it can even work. But some buyers are not waiting for a consensus. They’re grabbing Loreto Bay homes now.

“I came down for a weekend visit in 2005 after hearing about it,” Brian Durnian, 45, himself a real estate broker in Napa Valley in California, said one day this winter as he sat in the living room of his 2,200-square-foot, neo-Spanish Colonial second home at Loreto Bay. “There was nothing here except for the model homes. But I saw the mountains and the ocean. I like to kayak, golf, hike.” And Los Cabos, the hyper-popular resort area at the tip of Baja that he had been frequenting, had become overwhelming.

One look at the house he could have here, Mr. Durnian said, and “I was down for it.” His brother wanted to buy one, too, and he suggested, “Let’s buy a bigger one together.”

So, with his brother, Mr. Durnian bought a large lot; had a three-bedroom, two-bathroom adobe with roof terrace and cupola built on it for roughly $400,000; and hasn’t looked back.

He likes the style of Loreto Bay homes, which range from $1.5 million custom houses to entry-level one-bedroom casitas at around $350,000 — all uniformly airy and bright, with rooftop terraces facing the ocean or the mountains (in some cases, both), finished out with tile flooring, granite countertops in the kitchens and marbleized bathrooms. And he likes the neighbors, who are often free spirits with an easygoing sense of community. “There’s always a party at someone’s place,” he said.

Mr. Durnian has joined about a million Americans who now own property in Mexico, whether for investment or, more commonly, for personal use. There was a time when it was iffy business: public safety and health were questionable; titles to land sometimes unreliable. Now, with Mexico’s leaders placing a premium on attracting foreign buyers, regulation is better and there are reliable agents, title searches and insurance. Financing is available through American lending giants like GE Capital and Citigroup — whose property arm, is, in fact, the majority owner of the Loreto Bay Resort.

Owning property in Mexico still has its quirks — especially in coastal and border areas — though Loreto has somewhat smoothed the requirement that foreigners buy through a bank trust that technically holds title. It has established an overarching trust relationship with a bank, allowing buyers to deal directly with the developer.

Loreto has a long and twisty history. It was identified by the Mexican tourism agency in the 1970s as a target for development — along with Los Cabos, Ixtapa, Cancún and Huatulco. All were to get special attention as tourist venues. In Loreto’s case, the results were incomplete. The government put about $200 million into roads, water, sewers, electricity and a small airport, then promptly seemed to forget about the area as Los Cabos (including Cabo San Lucas) and Cancún began to blossom.

For years after that, Loreto remained almost orphaned, known mostly to dedicated eco-tourists (the waters off its coast are a marine preserve) and to a few travelers who came for its beach and the charming village of Loreto nearby. Then in 2000, a Canadian new urbanist developer, David Butterfield, was invited to take a look at Loreto. He immediately saw the potential: with the infrastructure already in place, the large, sustainable community of as many as 15,000 transient residents that the Mexican government desired could definitely be created.

Mexican tourism officials wanted to do something original at Loreto, according to Karina Carretero, a spokeswoman for Loreto Bay Resort — something different from the high-rises of Cancún and more in keeping with the area’s fragile ecology. As the founder of the Trust for Sustainable Development, a nonprofit corporation dedicated to building environmentally friendly, sustainable communities, Mr. Butterfield had already displayed the ability to build green, notably at Shoal Point, a residential and retail development on the harbor in Victoria, British Columbia, and at Civano, a development of housing, commercial space, offices and schools in Tucson.

Mr. Butterfield and a partner, the Phoenix developer Jim Grogan, had a master plan drawn up by Duany Plater-Zyberk, the architectural firm that designed Seaside, Fla. After quickly selling a couple of hundred lots and seeing some villas to completion, Mr. Butterfield and Mr. Grogan eventually bowed out, ceding control to an early investor, Citigroup Property Investors, which has the capital needed for such a large project. Although major elements like the wind farm and desalination plant have so far not materialized, Citigroup insists that the environmental commitment remains.

Mexico’s New Frontier

Published: March 7, 2008
(Page 2 of 2)

As was its designers’ wish, Loreto is best understood on foot. On a long, meandering walk one morning, I was able to note many of the elements of Mr. Butterfield’s vision. No matter where you are standing, you can see either the sea or the Sierra de la Giganta; nature always feels close by. Landscaping consists of indigenous trees, shrubs, cactus and grass that are resistant to salt, don’t need much water and can survive nicely on recycled waste water. All lighting is compact fluorescent. Even the building blocks fit the vision: they’re a combination of concrete and recycled Styrofoam.

Loreto’s pioneering residents spend their days golfing, kayaking, deep-sea fishing and hiking.

For some second-home shoppers, accessibility is a problem — Loreto is 700 miles south of San Diego via mainly two-lane roads. But air service has improved, now including flights on Alaska Airlines through Los Angeles, on Continental from Houston, and on Aero California and Aeroméxico from Los Angeles, San Diego and Phoenix.

Lots are continuing to sell — about 800 so far — and the dirt is flying. Many who do buy are drawn to the focus on environment and sustainability. And pricey as it seems, many also find Loreto a bargain.

Jon Clark, 55, bought a 3,800-square-foot penthouse condo for $625,000 in the early days of 2004. As an executive with Prudential California Realty in San Diego, he’s very familiar with Mexican real estate and his firm has often recommended Loreto to customers. “A comparable property in Cabo,” he said, “would cost well over $2.5 million.” And there’s a bonus: Mexican property taxes run about a tenth of those in the United States.

MR. CLARK’S house still isn’t finished. Loreto Bay at first “outsold their ability to build fast enough,” he said, adding that Citigroup and a new management company, Replay Resorts, have that under control. Yet he shows no resentment toward the first developers. “It was still the vision and the passion of the original team that captured my imagination,” he said. And he likes the atmosphere they created. “Loreto is anti-spring break,” he said. “My wife and I have seven kids. It’s clean, peaceful, safe.”

Another couple with children, Doug Brown and his wife, Ann, bought a lot in 2005 where their three-bedroom, two-bathroom villa now stands, expecting it to be their second home, but now making it their first. “There are just certain places that feel right,” Mr. Brown said.

After the house was finished last year, they sold their home in Carlsbad, Calif., packed up their possessions and their family and became full-time expatriates. “We liked the people on our first visit. But no question, we also bought the mission of this place.”

They use home schooling to supplement the education that their children, who learned some Spanish in kindergarten and first grade in California, receive at the public school in the town of Loreto. “I’d lived all the over the world as a customer service rep for fabric companies,” said Mr. Brown, 49. “It had been a great education to live outside the States. I wanted my kids to have that chance.”

Ms. Brown, 50, is similarly pleased. “I don’t feel isolated,” she said. “I don’t feel like I’m missing anything. As for American popular culture, I wanted to get away from that anyway.”

Like Mr. Durnian and Mr. Clark, the Browns have also watched their property appreciate. All estimated that their initial investments had nearly doubled, based on comparable current sales.

Bob Toubman, vice president of the Loreto Bay Resort, said the fully realized Loreto Bay would probably take “another 10 or so years to build out.” As for cost, “there’s a number out there, but you’re going to have to pick it,” he said. Actually, estimates range from $3 billion to $6 billion — a whopping build-out even by 21st-century standards.

But with the tens of millions of American baby boomers who are expected to retire or become semiretired over the next couple of decades, this just might be the shape of things to come.