Real Estate Craze Leads to Binational Marketing Blitz

BY KATIE WEEKS Watching the sunset from his estate in Mexico, Dave La Barre couldn’t contain his enthusiasm for his lifestyle. 

“You’re talking to me right now, and I’m standing here overlooking the Sea of Cortez from a house I bought for less than $500,000,” said La Barre, who is president and founder of Mi Casa del Mar, one of the largest of about 40 development companies making Baja California, Mexico’s San Felipe, “American ready.” In 2002, there were just four developers in that city. The house, he said, would have cost him $2 million to $3 million in San Diego, where La Barre was born and raised. 

While La Barre, 63, limits advertising to billboards and restaurant placemats in San Felipe, others have plans to spend millions to promote their ventures. Armando Ramos, 60, president of San Felipe Marina Resort, a $900 million oceanfront project, has spent hundreds of thousands of dollars to promote his gigantic project — and plans to spend a lot more. 

La Barre, an American, and Ramos, a Mexican citizen, battle decades of horror stories — real and imagined — about the Mexican government seizing property, crooked cops and insufficient infrastructure. But the two businessmen take different approaches. While La Barre said his aim isn’t to convert consumers who have already made up their minds, Ramos’ company has held educational seminars on how to buy his Mexican properties. La Barre would rather target people who have already visited Mexico. 

Targeting Western Markets Markets with a higher likelihood of buying a second home or vacation home in Mexico are Northern California, the Pacific Northwest, Texas and Arizona, said Georgi Bohrod, who has spent 10 years marketing time shares and homes in Mexico. Colorado, Minnesota and Chicago are secondary markets, said Bohrod, whose San Diego-based public relations firm, Georgi Bohrod Associates, services clients in Baja California and Puerto Vallarta, which is on the west coast of the mainland Mexican state of Jalisco. 

“You can have a gorgeous place on the beach that you could not afford to have in Del Mar or La Jolla,” Bohrod said. “There are situations on both sides of the border where you need to be cautious, but Mexico is one of the safest places to travel abroad, and the Mexican government is working to make it safer.” During the last 13-14 years, changes in laws have made it easier and more secure for Americans to buy land in Mexico, including the ability to buy beachfront property or land close to the border by putting it in a Mexican bank trust, or fideicomiso, said Pepe Larroque, an attorney with global law firm Baker & McKenzie. Larroque has been working in Mexican real estate law for 20 years, and works 60 percent of the time in Tijuana, and partly in the firm’s San Diego office. 

Developers, on the other hand, typically hold the title of Mexican land through a Mexican company they establish, instead of a fideicomiso, Larroque said More and more people are comfortable with the system,” Schreier said, adding that financing for Mexican property is about 2 percent higher, and closing on a home can take up to 90 days versus about two weeks in the United States. 

Schreier said mortgage firms like his, along with title insurance companies and developers, have begun advertising their services together to simplify the purchase for customers — a combo meal of sorts for vacation-home buying. Quick To Sell 

Finance North America, whose Del Mar call center receives about 300 inquiries each week, became profitable this summer after having been open only a year. Schreier said the rapid growth of his company, for which he declined to disclose revenues, is indicative of the increasing number of people looking to Baja to purchase beachfront property. The U.S. Census Bureau doesn’t track the number of Americans living in Mexico, but it might start during the 2010 census, according to the bureau. According to the 2000 Mexican census, there are at least 340,000 Americans living in Mexico. 

About 25,000 Americans buy property in Baja each year, said Ramos, whose San Felipe Marina Resort project includes a completed 80-room hotel and plans for 3,300 homes to border a golf course, 100 ocean-view villas and 40 condos priced at $600,000 each. “Baby boomers are the richest generation in American history,” Ramos said. “They’re choosing Mexico because there are less regulations and it’s cheaper.” 

Ramos said his company has spent around $350,000 on advertising annually for the last several years and will spend an additional $1.5 million on it during the next year. His development firm has billboards in Baja aimed at keeping Americans in Mexico. One reads, “George W. Who? You don’t need to know,” Ramos said. 

San Felipe Marina Resort also advertises in the San Diego Union-Tribune, San Francisco’s daily newspapers, online and in in-flight magazines. Ramos and his associates have held seminars in conjunction with brokers about purchasing properties at his resort. “We are doing business like America wants to do business,” Ramos said. “They trust more in Mexican developers now.” 

Construction on San Felipe Marina Resort began 12 years ago, and it is now entering the second phase. Ramos expects $100 million in sales for 2007, and $1.5 billion in the next 15 years. 

 

Be Sociable, Share!