Real Estate Development And Investment In Mexico
 Specifically, Investment Property in Los Cabos
 by David Mandich, Baja Real Estate Advisor

Great Investment Opportunity!
Santa Maria Condominios (See David's Top Pics for Commericial Property Investors)

Many people moving to Baja Sur want to invest in commercial income property as they did back in the States. They have heard that there is veritable land rush going on with people purchasing primary homes, condos, retirement and vacation homes.

And the influx is not just folks from the States or Canada – every time a new hotel is built, one thousand more families move from mainland Mexico to fill the new jobs being created in the area.

Opportunity Knocks - Rental homes and condos are in high demand.
All these new people coming to Baja increases pressure on the existing real estate stock. Not a day hardly goes by,

when I don’t receive a call or see a notice put on the MLS brokers net from someone looking for a long term condo or house to rent. The problem is exacerbated by area hotels renting private homes to house their staff, and condo owners moving their vacation condos from long term into short term vacation rentals for greater cash flow.

There is a definite window of opportunity right now for developers to build spec homes, condos and apartments in Los Cabos. A window so huge you could drive a cruise ship through it. Think Southern California in the 40’s, 50’s and 60’s when the military, aircraft, aerospace and entertainment industries were driving the growth there.  Laguna Beach, Malibu, Monterrey, and Napa-Sonoma properties were going for a song back then being considered far-away places where one might own a beach house or cabin. And it took two hours to get there from the major cities. Now it takes two hours to get to Cabo from those same cities – by air.

Opportunity knocks again – Build homes, apartments, condos & commercial
Many of those same people who moved to the West Coast back in those days, are now looking to Baja Sur for retirement homes, or at least 2nd homes that they, their children, and grandchildren can enjoy. If you are a builder, developer or investor in housing – your time has come! And building here compared to back THERE – (pick your State) is a breeze.

Here you can build your castle with little or no building inspections, low permit fees, and property taxes on luxury homes that cost about as much as a ticket for missing a stop sign in San Diego. Fully serviced ocean view residential lots run from $25,000 USD to $500,000 and ocean front lots from $200,000 to $12,000,000 - the price depending on the degree of your love for golf here in Baja Sur.

As the population grows so does the demand for commercial space. Good, newer commercial buildings in Los Cabos are 100% occupied with landlords giving only 6 months to one year leases. There isn’t much stock of older run-down commercial or residential fixer-uppers as in the USA.

Folks who made lots of money in the States renovating ugly ducklings and turning them into swans will find most of the ugly ducklings here are either crumbling 200 year old mud brick buildings or small concrete block buildings with low doorways. (The latter could describe a house or a commercial building). If you are into building commercial property – hotels, warehouses, office buildings etc., your building will be full of tenants, and rents will only go up as the population annually increases in the range of 15% or more.

The boom here really started only fifteen to twenty years ago when FONATUR the Mexican government tourist infrastructure development agency switched on the lights. They had developed Cancun and Los Cabos was next on the agenda. Some commercial properties that had been privately developed back then are now coming up for resale.

If one surveys commercial property on the MLS, one might conclude that there’s not much available. The truth is that there is quite a bit – but it’s often not listed with traditional brokerages for a number of reasons including – it being a sellers market, national pride, or sellers not wanting signage, tenants or the local community to know the property is on the market. This attitude seems strange to us coming from up North where one uses every trick in the book to sell a property up to and including hiring stylists to add smoke, mirrors and rented decorator furnishings as props. It’s a cultural difference.

Go here for my Top Pics for Commercial Property Investors