Sotavento Luxury Residences

by Marbella de Chicago, Thursday, January 25, 2018, 08:42 (483 days ago)

Hi Rob, I heard this construction is finally getting off the ground after 3 years! Can you tell me your thought on this development? Are the folks behind it ethical? I guess I just need to know that I would not be purchasing something that is causing harm to Zihua. Anyone else have any thoughts on this?

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Sotavento Luxury Residences

by Timmac @, Steilacoom, WA, Thursday, January 25, 2018, 09:40 (483 days ago) @ Marbella de Chicago

I think there have been a couple of ownership changes since this project started many years ago. I would be VERY wary.We've not ben back yet this year, but for several years there has been no visable progress.

Sotavento Luxury Residences

by Zbulldog, Thursday, January 25, 2018, 12:00 (483 days ago) @ Timmac

Typical high season promotion, "Coming Soon!"

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Sotavento Luxury Residences

by Talley Ho @, Thursday, January 25, 2018, 12:29 (483 days ago) @ Marbella de Chicago

It is now posted "Occupancy 2019."

Trevor is there every day selling units. He has loads of information, and has taken many deposits.

Starting last week, there is some activity going on, it appears to be earth moving at beach level.

They have a new website.

We are NOT involved in this project in any way, nor are we purchasers.

We would like to start a pool, 100p per entry, guessing the actual date of the first occupant moving in, but only if we can have the "date" we want first!!;-)

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Sotavento Luxury Residences

by Timmac @, Steilacoom, WA, Thursday, January 25, 2018, 15:26 (483 days ago) @ Talley Ho

Well, I could be interested, but I'd have to know that should I win, the money would go to my heirs as I figure I’ll only be around for 20 years or so.

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Sotavento Luxury Residences

by Talley Ho @, Thursday, January 25, 2018, 15:45 (483 days ago) @ Timmac

:megusta:

Forgot to add the time frame of in the next 2 years.....

Sotavento Luxury Residences

by OlsenMN, Thursday, January 25, 2018, 13:02 (483 days ago) @ Marbella de Chicago

Anyone stupid enough to pay a pre-sale deposit on a development that has gone bankrupt twice already deserves whatever comes their way.B-)

Sotavento Luxury Residences

by jaz, Thursday, January 25, 2018, 15:58 (483 days ago) @ OlsenMN

It has been in this state of "non-development"for many more years than 3, people have lost money and I would be wary to get involved,just my opinion.

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by Curbarn, summer b.c. winter zihua, Friday, January 26, 2018, 21:58 (481 days ago) @ jaz

I am only aware of people who were refunded, and really did it go bankrupt? Or did the developer pull the plug and delay.?

Sotavento Luxury Residences

by DanCip, Monday, April 02, 2018, 13:42 (416 days ago) @ Marbella de Chicago

Hello folks just joined your Blog yesterday and have read all of your comments on the Sotavento Resort Condo's (sorry for the long posting). My wife & I had reserved a unit about 2 1/2 years ago and, at this point, we have not put any money down (ironically, Trevor would not take our money at that time - he only asked for a commitment letter from us). We love the opportunity to buy on LaRopa but we've been just as frustrated with the slow progress as it seems all of you are.

Let me give some positive feedback & some updates from what we know.

1) Trevor (who was with the project from the beginning) has always been responsive to our requests for updates. Yes, he's been guarded with his responses, but he's always been responsive. At times he has seemed as frustrated as we've been. Clearly he knows the whole sorted truth behind the failed projects & possible law suits by former "reservers". But we do give him credit for keeping a positive attitude while sticking with this roll-o-coaster project. We figure that if he was involved in a scam down there then he is the worst confidence man in the industry - what con artist would take 6-8 years to rip us off? Then hang around to address & arbitrate lawsuits.

2) My wife & I were down to La Ropa for a vacation 3 weeks ago and there is clearly construction going on. We met with and walked the property with Trevor & the lead Construction Foreman and they shared the updates of their progress and where they are headed next. We asked: Who are the money people? (they will be named soon - they are in the process of setting up a new LLC), Where are the new contracts? (very soon after set-up of LLC), Do they have the Operating Agreement yet? (coming soon with the contracts). Where there anymore issues with infrastructure entitlements? Etc, etc, etc....etc. So it appears that all information is pending on the announcement of who the new finance company will be (heard this before - Yes, but someone is spending money on site as we speak.

3) Construction is definitely re-underway. The work has started down at the beach level in preparation for the beach restaurant. Walls have gone up where and masseuses are gone. There were about 50 construction workers on site with heavy construction equipment (as an aside, and proof that construction has been going on this season - IntraWest (Embrac) next door had posted signs warning guests of construction sounds/noises). Trevor said they hope to have the building elevator in place before the end of this season. Looking to 14-18 more months of work (oh well that could mean 20-24).

That's pretty much what I have to share and would love to add pictures BUT I can't figure out how to paste them into this thread. If anyone can help I will be more then glad to share... (so far in my failed attempt to cut & paste - I've right clicked, then selected "Copy Image", then right clicked "Paste" but sadly received text graphic garbage (https://apis.mail.yahoo.com/ws/v3/mailboxes......blah, blah, blah..).

Sotavento Luxury Residences

by DanCip, Thursday, November 01, 2018, 11:32 (203 days ago) @ DanCip

Latest update.....

Sotavento has a green light for financing, for sales management, and an aggressive increase in construction efforts. For those of you that are on LaRopa you should be seeing major construction activity. We've received pictures of the increased activity and have been in touch with the Sotavento management for the past 2 weeks. They've cleared the water permit issues, the Federal Zone issues, and they are aggressively moving forward with construction and finalizing ownership contracts.

Ww would love to hear feedback from those of you that live down there.

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Sotavento Luxury Residences

by ZihuaRob ⌂ @, Zihuatanejo, México, Thursday, November 01, 2018, 11:39 (203 days ago) @ DanCip

Latest update.....

Sotavento has a green light for financing, for sales management, and an aggressive increase in construction efforts. For those of you that are on LaRopa you should be seeing major construction activity. We've received pictures of the increased activity and have been in touch with the Sotavento management for the past 2 weeks. They've cleared the water permit issues, the Federal Zone issues, and they are aggressively moving forward with construction and finalizing ownership contracts.

Ww would love to hear feedback from those of you that live down there.

Condos on La Ropa Beach? Yuck!

Should've left it a hotel.

Not a condo fan. Watched them ruin too much of Florida's coasts.

Sotavento Luxury Residences

by DanCip, Monday, November 05, 2018, 15:01 (199 days ago) @ ZihuaRob

Let me clarify - by all appearances it will be a hotel. The units will be purchased as condos BUT when the owners are not using their property the units will be rented. Revenues will be split with the hotel management team..

Sotavento Luxury Residences

by OlsenMN, Monday, November 05, 2018, 15:37 (199 days ago) @ DanCip

Hello folks just joined your Blog yesterday and have read all of your comments on the Sotavento Resort Condo's (sorry for the long posting). My wife & I had reserved a unit about 2 1/2 years ago and, at this point, we have not put any money down (ironically, Trevor would not take our money at that time - he only asked for a commitment letter from us). We love the opportunity to buy on LaRopa but we've been just as frustrated with the slow progress as it seems all of you are.

Here is some history from 2012 when it closed down the first time.long ago here on the board

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Sotavento Luxury Residences

by Talley Ho @, Monday, November 05, 2018, 16:21 (199 days ago) @ OlsenMN

Fascinating. Thanks for it.

Sotavento Luxury Residences

by DanCip, Monday, November 05, 2018, 16:54 (199 days ago) @ OlsenMN

Here is some more additional information to be added to the Zihuatanejo Blog information library:

The new project has been incorporated as: Sotavento Luxury Residences,S de RL de CV

The new developer is a Canadian company called: Performing Equity (Sotavento) Ltd. and they are owned by 2 gentleman by the names of Michael Drever and Paul Grehan.

The new property sales & condo management team is: Sotavento Residence Club.

The good news is they've hired 100 new construction workers for November & December. And real time construction videos will be up and running in 2 weeks.

Sotavento Luxury Residences

by DanCip, Sunday, December 30, 2018, 19:02 (144 days ago) @ OlsenMN

Thank you..!!

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Sotavento Luxury Residences

by Talley Ho @, Monday, November 05, 2018, 17:12 (199 days ago) @ Marbella de Chicago

We have friends who signed up for e-mail updates from Trevor. They shared this with us and we have shared it with others. It was sent out in late August/early September 2018, but can't give you the exact date.

Dear,
Thank you for your past interest in the Sotavento Luxury Residences. At this time there is an opportunity to hold one of the remaining units before the price increase October 1, 2018.
There are a total of 118 units in the North and South Towers - 36 units sold, 21 units reserved, 13 open (see attached) and 48 that may go whole ownership, fractional or vacation program.
Occupancy is expected November/December 2019 for the South Tower with all resort amenities and April/May 2020 for the North Tower.
Lock in the Pre-construction Pricing and reserve your unit today.

Whole Ownership Opportunity 1, 2 & 3 Bedroom Suites
Luxurious transformation of landmark property now underway
Whole ownership condominiums on the coveted Playa La Ropa Beach
Best location on the beach with all suites having an incredible ocean view
Gorgeous renovations include all furnishings, full kitchens and in suite laundry
The only beachfront property on Playa La Ropa with elevator access from beach to all floors
Amenities - restaurant, pool, spa, store, fitness center, business center
Storage lockers and parking stalls available
Optional rental management program to help you enjoy income when you are not using your unit
24 hour gated security
Exclusive neighbours on the beach - Viceroy, Embarc and La Casa Que Canta
$1,000 refundable deposit will hold you reservation position
There are still several units available in the whole ownership program and I have attached the available list and unit floor plans for the North and South Towers. I have also included some of the new renderings to show the design of the property, a reservation agreement and the site development summary.
To hold one of the available units requires completion of the attached reservation agreement. This will hold your unit until all the information is available to make an informed decision. With the construction contract awarded and crews mobilized to complete the project, we expect interest and reservations to increase as the construction advances over the next year. There are currently 100 workers on site and we expect to have 200-300 by December, 2018.
Checkout the attachments and website for all the details and reserve your unit today and save $15,000-$25,000USD depending on the unit. If you have interest in a particular unit or have questions please email me or if you would like to discuss further, send a convenient time and number to call.
Best regards,

Trevor Redfern
Sotavento Luxury Residences
Phone 604-889-2950
Toll free from Mexico 01-800-681-1516
Toll free USA/Canada 1-888-727-0789

www.sotaventoresort.com
Reservation Agreement
Development Summary
South Tower
North Tower

Sotavento Luxury Residences

by DanCip, Tuesday, November 06, 2018, 11:44 (198 days ago) @ Talley Ho

One point to note regarding the "optional rental management program" noted in a prior post.....

It's not optional - there are two rental management options and both will not allow you have unfettered access to your unit. There are two programs; a 50% or 60% "sharing program"(they have details forthcoming). Regardless of which option you choice you will basically split income with the management team - less a commission/compensation for their marketing efforts (not ID'd yet), AND as owners of the building you will not participate in revenues from the restaurant or bars.

So if you are looking at this as an investment you should lower your expectations and expect somewhere between a 2-4% return. The other downsides to the project are: the increased crime in Z, political instability, low upside capital appreciation on resales, daily construction work & construction noise for the next several years, and all of this coupled with the guaranted negative returns for the next several years while they market the property for rental traffic.

Because we love La Ropa, it was our hope that we were going to reside at least 2-3 months per year at Sotavento, but because of the restrictions on the resident owners and everything noted above we've decided not to purchase and will instead visit as vacation renters (as we've been doing for the past 15 years)..

Sotavento Luxury Residences

by DanCip, Thursday, November 08, 2018, 12:12 (196 days ago) @ DanCip

Oh one more comment on the list of Sotavento Sales Promotion items noted above, more specifically regarding "Lock in the Pre-construction Pricing and reserve your unit today". This is sales talk, they have not stood by their word on this. They have increased our locked-in pre-reserved unit pricing for several "new property infrastructure requirements" without any apologies, just a take it or leave, and its not our fault that the other guy guaranteed you a price guarantee. They should delete this sales puffery and simply replace it with: Sign-up with us now and we'll let you know what the price is in the future.

Sotavento Luxury Residences

by Sotavento, Wednesday, December 26, 2018, 20:16 (148 days ago) @ DanCip

Hi Dancip? I thought I would reply to your post and add a few clarifications:

1) The rental pool is completely voluntary. Nobody is obliged to place their unit in it. However, if you are planning on renting your unit, you are obliged to rent through the rental company. This is to ensure consistency in marketing as well as to provide a larger marketing budget so that occupancy rates can be maximized which leads to larger returns for the owners of the units. If everybody rented their units independently, there would be no coordinated advertising effort and the units would basically be empty for much of the year. Using the rental agency allows the building to be marketed year round. Furthermore, when possible renters require two or more rooms, a central agency allows this to happen by pooling the units;

2) With respect to forecast returns of 2-4%, I'm not sure where you're drawing your numbers from. Again, this all depends upon occupancy, rental rates seasonality etc. The developer is highly incented to ensure the highest possible occupancy and rental rates. They also have a a very deep background in the travel and reservation industry. One of them sold his travel business to Expedia a few years ago. I believe it was a huge cruise ship chain;

3) With respect to low capital appreciation on resales, HVS, the worlds largest resort consultancy forecasts appreciation of 8% per year in the area. Furthermore, Sotavento units have more than doubled in sales prices since 2012 and prices were raised 15% in October. Those unit holders that acquired their units in 2012 (even though they were disappointed with the prior developer, still doubled their values);

4) On December 8th, the mayor of xtapa/Zihua (Jorge Sanchez) hosted an event on the beach at the Sotavento project for many of the toursim providers in the region. I had the opportunity to talk with him at great length. Zihua has a very low incidence of violence or even theft. Tourism represents 90% of the economy and they protect it vigilantly. Hence the focus on cleaning up the town as well as the introduction of new tourist police this season.

5) Occupancy in Zihua is at a record high for the 2018/19 season (based upon advanced bookings). xtapa/Zihau is now the third largest tourist destination in Mexico. Tourism growth in Mexico is one of the fast growing in the world at close to 16% per annum. There are several large developments in the planning stage in Zihua (one by the largest developer in Florida). However, only Sotavento is on the beach.

6) Not sure what restrictions on resident owners you are referring to.

Sotavento Luxury Residences

by midalake @, Wednesday, December 26, 2018, 21:38 (147 days ago) @ Sotavento

Hi Dancip? I thought I would reply to your post and add a few clarifications:

1) The rental pool is completely voluntary. Nobody is obliged to place their unit in it. However, if you are planning on renting your unit, you are obliged to rent through the rental company. This is to ensure consistency in marketing as well as to provide a larger marketing budget so that occupancy rates can be maximized which leads to larger returns for the owners of the units. If everybody rented their units independently, there would be no coordinated advertising effort and the units would basically be empty for much of the year. Using the rental agency allows the building to be marketed year round. Furthermore, when possible renters require two or more rooms, a central agency allows this to happen by pooling the units;

2) With respect to forecast returns of 2-4%, I'm not sure where you're drawing your numbers from. Again, this all depends upon occupancy, rental rates seasonality etc. The developer is highly incented to ensure the highest possible occupancy and rental rates. They also have a a very deep background in the travel and reservation industry. One of them sold his travel business to Expedia a few years ago. I believe it was a huge cruise ship chain;

3) With respect to low capital appreciation on resales, HVS, the worlds largest resort consultancy forecasts appreciation of 8% per year in the area. Furthermore, Sotavento units have more than doubled in sales prices since 2012 and prices were raised 15% in October. Those unit holders that acquired their units in 2012 (even though they were disappointed with the prior developer, still doubled their values);

4) On December 8th, the mayor of xtapa/Zihua (Jorge Sanchez) hosted an event on the beach at the Sotavento project for many of the toursim providers in the region. I had the opportunity to talk with him at great length. Zihua has a very low incidence of violence or even theft. Tourism represents 90% of the economy and they protect it vigilantly. Hence the focus on cleaning up the town as well as the introduction of new tourist police this season.

5) Occupancy in Zihua is at a record high for the 2018/19 season (based upon advanced bookings). xtapa/Zihau is now the third largest tourist destination in Mexico. Tourism growth in Mexico is one of the fast growing in the world at close to 16% per annum. There are several large developments in the planning stage in Zihua (one by the largest developer in Florida). However, only Sotavento is on the beach.

6) Not sure what restrictions on resident owners you are referring to.


I have not followed this project and do not plan to. However after reading this, point #1 is pure BS. If the property is structured correctly the owners will eventually give the builder the boot and hire their own manager and have their own association. THIS would be a great time to buy at this property.

D

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by ZihuaRob ⌂ @, Zihuatanejo, México, Wednesday, December 26, 2018, 22:28 (147 days ago) @ Sotavento

Thank you for taking the time to speak up for the Sotsavento development and providing so many details.

As a local, I’m more concerned about the quality of the job opportunities created for locals besides the menial labor and service jobs that pay poverty wages. The part about requiring owners to rent through a rental agency based elsewhere hurts locals like me as well as my friends and neighbors in the local real estate business. Local professionals tend to recommend services and businesses when those businesses also reciprocate. And it is extremely difficult to have a successful business here when locals don’t recommend you. The Sotavento has brought their marketing team with them. So why would locals other than politicians, especially professionals, recommend the Sotavento. What is the Sotavento offering to the community?

Sotavento Luxury Residences

by Sotavento, Thursday, December 27, 2018, 00:17 (147 days ago) @ ZihuaRob

I'm not really interested in getting in a heated debate....just thought I'd shed some light.

FYI the restaurant in the complex will be a JV with a local Zihua national and I'm not certain anybody said that the rental agency wouldn't be based in Zihua. And, as another commenter mentioned, it's entirely possible that the owners association may ultimately decide that they don't want an outside agency to run the rentals. At the end o the day, the choice will be with the unit owners

As far as quality jobs, the architect is ZIha based as is the engineer the legal council and the accountants All senior staff live in Zihua and the builder is a Mexican entity that built the neighbouring Embarc.

Yes, there are menial jobs associated with a building like this. However, I suspect if you asked the people working on the site, they're likely glad to have the work.

Having being around Zihua for quite some time, I'm surprised that you're not happy that the project is moving forward;

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Not Feeling The Love

by ZihuaRob ⌂ @, Zihuatanejo, México, Thursday, December 27, 2018, 10:39 (147 days ago) @ Sotavento

I'm not really interested in getting in a heated debate....just thought I'd shed some light.

FYI the restaurant in the complex will be a JV with a local Zihua national and I'm not certain anybody said that the rental agency wouldn't be based in Zihua. And, as another commenter mentioned, it's entirely possible that the owners association may ultimately decide that they don't want an outside agency to run the rentals. At the end o the day, the choice will be with the unit owners

As far as quality jobs, the architect is ZIha based as is the engineer the legal council and the accountants All senior staff live in Zihua and the builder is a Mexican entity that built the neighbouring Embarc.

Yes, there are menial jobs associated with a building like this. However, I suspect if you asked the people working on the site, they're likely glad to have the work.

Having being around Zihua for quite some time, I'm surprised that you're not happy that the project is moving forward;

I’m not feeling the love.

As a Zihuatanejo citizen who loves this community very much, I was much happier when the Sotavento was a hotel that was popular with locals and tourists. In general hotels tend to generate better jobs and income for our community than condos.

I’m trying to keep an open mind, but your reply does not inspire confidence. I see a cold calculator interested only in jostling for position to suckle what it can from the Zihuatanejo cash cow, justifying the few menial jobs it might provide as “better than nothing,” a rationalization I don’t share. Your neighbors at the Catalina are folks who give much back to the community and have earned much respect among locals which is why it remains a favorite place to recommend. I am unaware of any condo development here that is comparable.

Not Feeling The Love

by Sotavento, Thursday, December 27, 2018, 20:52 (146 days ago) @ ZihuaRob

Hi Rob,

I'm not sure where the cold calculator came from....I actually spent my honeymoon in zihua 32 years ago. So, while my ties may not be as deep as yours (nor do I profess), I do care about the community as you clearly do.

That being said, I do respect your opinion that you preferred when it was a hotel...unfortunately that's not something I control. The previous owners made that decision. However, i do assure you that it is our intent for Sotavento to become part of the community both in supporting the outlying areas as well as a first class employer.

When we took over this project, we inherited a lot of baggage both from previous unit buyers as well as from locals. All were tired and frustrated of the past 6 years of the stalled project. As mentioned earlier, I can't undo the past and all I control are my own actions.

The current project may not be to your exact liking. But, it's better than what was there two years ago and hopefully, as you become more acquainted with it, you'll see that we're not the cold calculating money strippers that you seem to envision.

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Ahora sí

by ZihuaRob ⌂ @, Zihuatanejo, México, Thursday, December 27, 2018, 21:52 (146 days ago) @ Sotavento

Hi Rob,

I'm not sure where the cold calculator came from....I actually spent my honeymoon in zihua 32 years ago. So, while my ties may not be as deep as yours (nor do I profess), I do care about the community as you clearly do.

That being said, I do respect your opinion that you preferred when it was a hotel...unfortunately that's not something I control. The previous owners made that decision. However, i do assure you that it is our intent for Sotavento to become part of the community both in supporting the outlying areas as well as a first class employer.

When we took over this project, we inherited a lot of baggage both from previous unit buyers as well as from locals. All were tired and frustrated of the past 6 years of the stalled project. As mentioned earlier, I can't undo the past and all I control are my own actions.

The current project may not be to your exact liking. But, it's better than what was there two years ago and hopefully, as you become more acquainted with it, you'll see that we're not the cold calculating money strippers that you seem to envision.

Thank you sincerely for your kind and honest reply. I appreciate what you’re trying to do and I do wish you success. Recibe un cálido saludo.

Ahora sí

by Sotavento, Thursday, December 27, 2018, 22:46 (146 days ago) @ ZihuaRob

Thanks for your wishes.....

Ahora sí

by Sotavento, Monday, December 31, 2018, 22:57 (142 days ago) @ ZihuaRob

Hi Rob,

Would you like to meet one of the owners of Sotavento in the next while?

Your concerns have been very rational and i think you would get great comfort in knowing where the developers are coming from. I think you'd be pleasantly surprised.

Likely not what you expect at all.

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by Timmac @, Steilacoom, WA, Thursday, December 27, 2018, 09:34 (147 days ago) @ Sotavento

3) With respect to low capital appreciation on resales, HVS, the worlds largest resort consultancy forecasts appreciation of 8% per year in the area. Furthermore, Sotavento units have more than doubled in sales prices since 2012 and prices were raised 15% in October. Those unit holders that acquired their units in 2012 (even though they were disappointed with the prior developer, still doubled their values);


The fact that the sales price has "more than doubled" has absoulutely nothing to do with capital appreciation. The only thing that matters is what an owner can sell for on the open market. No matter what any property is listed for, or appraised at, the actual value is what a buyer is willing to pay, not what a developer says it is worth.

It would be VERY unusual for an owner of any property like this to actualy profit on this sort of investment. It is even difficult to sell it as a way to make your lodging costs fixed, as the maintenace fees always increase.

Depending on the structure of the association, the owners may have very little say in its management.

Sotavento Luxury Residences

by DanCip, Sunday, December 30, 2018, 18:55 (144 days ago) @ Timmac

add to Timmac's point (sorry for the long posting)...

We've been looking at properties in Z for over 6-7 years (while waiting to retire) and we've consistently noticed that the secondary market for homes/condos have sold for somewhere between 10-20% below "ask" (you would be foolish to pay "ask" price in Z) and if that wasn't bad enough, we've seen homes/condos sit on the market for over 2-3 years.

Another BIG real estate challenge in Zihuatanejo is the fact that the property is only rentable for just 8-9 months of the year. Unlike other vacation spots in Canada &/or the U.S. whose off-season’s are being used for non-core activities (downhill biking at Whistler) Sotavento’s off-season months, because of the mosquitoes & the rain, will not be rentable. Which means that one's real estate "investment" in Zihuatanejo WILL sit idle 25% of the time, while your fixed monthly costs will not. This will reduce your overall investment return.

There are two other secondary issues when one considers a new purchase at Sotavento: (1) the rental/management company will not fully rent out the property to “100% capacity” (generally a vacation property may rent out up to ~85% to be considered maximum capacity) for at least 2-3 years which will more than guaranteed a negative (or breakeven) cash flow that needs to be subtracted from one’s overall return investment return.

Another minor point that needs to be considered that may or may not show up on an owners bottom line, but should be considered, is the inconvenience of construction activity and construction noise for the next 2-3 years and how that will play into the properties vacancy rate.

My wife & I have been very fortunate active investors in the Seattle condo real estate market over the past 8-9 years (one of the hottest real estate markets in the U.S.) and we’ve been fortunate to see our investment returns average between 8-12% overall net returns, but there is just NO WAY, NO WAY that an equity investor, depending on the management company at Sotavento will ever see anything greater then a 2-6% return after you weigh in your monthly fixed costs, your 25% no-rent months during the off-seasons, the management/owner income split, the sales commission that you will pay to the sales promoters, and Z’s historically soft real estate market. And all of the above does not take into consideration existing crime, Canadian & U.S. travel warnings, Mexico/U.S. political instability, and the possible food-fight’s between the management company and the future Home Owners Association.

Now don't get me wrong, Zihuatanejo is beautiful, we love it, but it seems that the true real estate investment winners in Z are either the developers (and not all of them have been lucky to sell-out a project – i.e. Loot & KahKan) and/or those investors who are patient enough to wait for a development to be completed and “seasoned” for a few years before one purchases a resale there.

When you add it all up my wife & I will definitely be renters at Sotavento, but never owners.

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by Talley Ho @, Sunday, December 30, 2018, 19:01 (144 days ago) @ DanCip

JMHO If you buy in Mexico you are doing it because you want to live here, not as an investment.

We purchased a house, are thrilled and live here full time.

It's not for everyone, thank goodness!

Sotavento Luxury Residences

by DanCip, Sunday, December 30, 2018, 19:09 (144 days ago) @ Talley Ho

It is a beautiful country there is no denying that, and Z is the perfect place for us. But we've been down there during the rainy season and it was not pleasant (I guess we are wimps)..

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by Talley Ho @, Sunday, December 30, 2018, 19:22 (144 days ago) @ DanCip

We love the rainy season! Not only are there very few tourists, the temps are only about 3 degrees F more than the winter, and the humidity is exactly the same.

We have a weather station installed, and have recently received the data logger so our info here on Playa la Ropa will be on line as soon as we get around to installing it.

The rain is mostly at night, and the "light show" before sunrise is wonderful. We can't think of any place we'd rather live.

We have probably have made a mistake pitching year around living here because we'll be overwhelmed! Paradise!!!

Sotavento Luxury Residences

by Casa Juan @, Sunday, December 30, 2018, 21:06 (143 days ago) @ DanCip

the travel warnings have not changed in at least a few years, yet north of the border there is more than enough crime to go around. If you want guaranteed perfect living anywhere, you probably want to contact St Peter for room upstairs when a vacancy occurs.

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by Talley Ho @, Sunday, December 30, 2018, 21:09 (143 days ago) @ Casa Juan

:megusta:

Sotavento Luxury Residences

by DanCip, Sunday, December 30, 2018, 12:32 (144 days ago) @ Sotavento

Hello Sotavento, Thanks for your feedback and I could debate most of your points noted above but you neglected to address my post about your "Locked-in" the pre-construction pricing. You didn't lock in did you - admit it to our readers? You changed the price on previous reserved units didn't you?

Sotavento Luxury Residences

by Sotavento, Monday, December 31, 2018, 22:50 (142 days ago) @ DanCip

Hi Dan,

I'm not avoiding the topic at all. I came on this list with a view to being very open an honest....

The reservations you refer to were made under an old regime that went into liquidation/insolvent. The new developer was a lender who foreclosed on the property and has committed new capital and expertise to finish it. I"m not sure why you would expect them to honour a deal made by a previous developer who went insolvent. Especially if that deal was to honour a price that was over 2 years old and for which the other party didn't actually make a material deposit. The reservation holder never actually agreed to pay the purchase price so, why would you expect the developer to honour the purchase price....that wouldn't make sense. Lot's of people put their name on reservation lists but never intend to buy a unit.

To be clear, you didn't buy a unit; you simply implied that you were interested. Those that actually acquired units wrote cheques for at least 30% of the purchase price and had their deals honoured. There were 39 original unit owners of which 35 have decided to remain with the project and 4 have decided to sell their units for a variety of reasons and we're assisting with that process. Most unit holders have seen the values of their units double since 2012.

What I'm a bit confused about is, in your most recent posts you go to great lengths to expound as to why you would never buy in Zihua, how you'd never be able to rent your unit and how there is never any price appreciation (most of your assertion are incorrect but, that's not my point) So, why are you so upset that your reserved price wasn't honoured if you think it's such a bad idea to acquire a unit anyways? It should be a moot point to you.

Clearly you're very angry or bitter over something at Sotavento or with life itself.....I can't help with that. It wasn't me, or the new developer or Trevor or anybody else...the world simply went through a great upheaval in 2012 (great recession) and Sotavento was one of the many, many things that got hurt (think of the countries of Greece or the housing correction in the USA). You can either accept that and move on or, remain bitter...your choice.

In the meantime, I'm happy to add clarity to the project and answer questions and concerns. However, I've zero interest in being the focus of your bitterness.

Zihua is a wonderful place and whether you rent somewhere or own a unit at Sotavento, it's hard to go wrong.

Sotavento Luxury Residences

by DanCip, Tuesday, January 01, 2019, 00:45 (142 days ago) @ Sotavento

For people reading this blog please note the tone of this Sotavento representative. He represents the general tone of how you should expect to be treated when they are confronted with your concerns & facts. It’’s your standard take it or leave it developer attitude, Ya know the one, it starts with “DO YOU GOTTA FN PROBLEM MAN”..!! And also notice that when confronted with their reality that I’m the one who’s upset, I’m the one that’s angry, and I’m the one that’s bitter.

Let me first respond with a layup response to “why I would never buy in Z”. #1) We only buy an investment at a price where we can see some capital appreciation and/or if we can cover monthly cash outlays. #2) We had signed a contract with Sotavento at investment appropriate price & because of that contract & commitment we felt bound to wait for its financing & completion over the past 3+ years (sadly when you folks raised the price you in enhance “stole” my capital appreciation making the investment unattractive).

Regarding “lots of people that never intend to buy a unit”, that they were just “implied” sale. My brother did reserve a unit in 2015 and a contracted to purchase, by providing the only form of payment requested, a credit card was provided (but never activated) to reserve the unit. He & I intended on being be partners. He/we waited for 3+ years for the project to get sorted out and reached out to the sales representative to “finalize” the sale at least once every 6 months. At that time a contract WAS created by the sales rep that is also a current representative of the company. So from a contractual perspectives there was a offer & acceptance, consideration was offered & accepted, and a unit was reserved for the special per-sale locked in price. All of this constitutes a valid contract and NOT someone just putting “their name on a list”. And when my brother attempted to reach out to work out a compromise this (I assume) company representative refused to return the calls.

Now this constant banter about “well that was the old regime” stuff falls on deaf ears. The new company simply stepped into the shoes of the old company by evidence of the facts that you have the same sales employee(s) on staff, you have the same reservation list, and you’ve contacted the same future purchasers to confirm their CONTRACTS. And you yourself, in your post, admitted that people who contracted & reserved units have doubled their money - you stepped in a took their profits by increasing your prices. All this is a thin excuse to screw over and increase the prices on the people that were simply trying to get a pre-sale locked-in price.

To future buyers ask yourselves what’s to prevent them from doing this again; by locking people into a contract, then sell the list of their new shell company and then increase the prices again so they can meet their new future ROI. Then when you complain you get the treatment you’ve witnessed in the previous post.

No we didn’t just fall off a taco truck yesterday, your simply a salesman pushing a deal together who’s primary job is to make a profit no matter who you have to roll to get it...

Again I will be a renter and not an owner in your initial offering (I’ll wait till the current owners sell at a discount)...

Sotavento Luxury Residences

by midalake @, Tuesday, January 01, 2019, 09:33 (142 days ago) @ DanCip

For people reading this blog please note the tone of this Sotavento representative. He represents the general tone of how you should expect to be treated when they are confronted with your concerns & facts. It’’s your standard take it or leave it developer attitude, Ya know the one, it starts with “DO YOU GOTTA FN PROBLEM MAN”..!! And also notice that when confronted with their reality that I’m the one who’s upset, I’m the one that’s angry, and I’m the one that’s bitter.

Let me first respond with a layup response to “why I would never buy in Z”. #1) We only buy an investment at a price where we can see some capital appreciation and/or if we can cover monthly cash outlays. #2) We had signed a contract with Sotavento at investment appropriate price & because of that contract & commitment we felt bound to wait for its financing & completion over the past 3+ years (sadly when you folks raised the price you in enhance “stole” my capital appreciation making the investment unattractive).

Regarding “lots of people that never intend to buy a unit”, that they were just “implied” sale. My brother did reserve a unit in 2015 and a contracted to purchase, by providing the only form of payment requested, a credit card was provided (but never activated) to reserve the unit. He & I intended on being be partners. He/we waited for 3+ years for the project to get sorted out and reached out to the sales representative to “finalize” the sale at least once every 6 months. At that time a contract WAS created by the sales rep that is also a current representative of the company. So from a contractual perspectives there was a offer & acceptance, consideration was offered & accepted, and a unit was reserved for the special per-sale locked in price. All of this constitutes a valid contract and NOT someone just putting “their name on a list”. And when my brother attempted to reach out to work out a compromise this (I assume) company representative refused to return the calls.

Now this constant banter about “well that was the old regime” stuff falls on deaf ears. The new company simply stepped into the shoes of the old company by evidence of the facts that you have the same sales employee(s) on staff, you have the same reservation list, and you’ve contacted the same future purchasers to confirm their CONTRACTS. And you yourself, in your post, admitted that people who contracted & reserved units have doubled their money - you stepped in a took their profits by increasing your prices. All this is a thin excuse to screw over and increase the prices on the people that were simply trying to get a pre-sale locked-in price.

To future buyers ask yourselves what’s to prevent them from doing this again; by locking people into a contract, then sell the list of their new shell company and then increase the prices again so they can meet their new future ROI. Then when you complain you get the treatment you’ve witnessed in the previous post.

No we didn’t just fall off a taco truck yesterday, your simply a salesman pushing a deal together who’s primary job is to make a profit no matter who you have to roll to get it...

Again I will be a renter and not an owner in your initial offering (I’ll wait till the current owners sell at a discount)...

DanCip

You should quit as it is clear you are no genius. You already made the FIRST mistake saying you tried to invest in pre-construction in Mexico.

Second You are now bitter and ass-uming you will be better-off getting in after construction. This has NOT been true for people who invested [pre-construction] in Ixtapa. From Real de Plamas to BVG-1-2 to Amara. ALL of these people have capital appreciation. So while you may get a "deal" at some point you are completely incorrect to think you will "get-in" cheaper than an original owner.

Three Most of us know already there is a 25% exit tax for foreigners on any profits made on real estate. THIS FACT also proves that buying ANY property in Mexico is not some kind of major genius move.

My point is, Your goals from the start do not fit the definition!

D

Sotavento Luxury Residences

by Sotavento, Tuesday, January 01, 2019, 12:24 (142 days ago) @ midalake

Thank you D;

I would agree that unit buyers who acquire in the developing stage have an advantage over those who buy in the complete stage in terms of pricing. Much of this is because many owners prefer to have a unit ready to unoccupy without the uncertainties of construction. As such, developers often increase prices as the project proceeds and demand increases.

For some clarification, yes there is a 25% withholding tax on a sale in Mexico. However, this same withholding tax exists if, as a foreign citizen you sell a property in Canada or the USA. Under the tax treaties between the two countries this tax withheld can be applied against your capital gains or profits in your home county. The witholding tax is designed so that foreigners who transact in a country can't take their profits out before paying tax.

A foreigner selling a property in the USA is actually worse off. The 25% is applied not against profits but against the full selling price.

At the end of the day, while profits may happen for unit buyers at Sotavento, i don't think that should be the key driver. It's a "Lifestyle asset" Something you own because it enhances your life. Yes, most unit buyers will probably turn a profit but, I hope their value in ownership and use exceeds those profits.

People who own homes in Florida, Palm Springs, Scottsdale, Whistler, Aspen, Puerto Vallarta didn't all buy because it promised a financial windfall. They did it because it's where they chose to spend their win.

Happy New year.

Sotavento Luxury Residences

by DanCip, Tuesday, January 01, 2019, 13:31 (142 days ago) @ midalake

I've found that when a company hires someone to be their spokesperson they're hiring someone who puts the company's best foot forward, a person that represents the company's values & vision, a person that demonstrates grace & poise while demonstrating to their target audience that this is a company that you would LOVE to do business with.

To future buyers at Sotavento note the tone of their spokesperson. If this graceless spokesperson represents the best this company has to offer, if he represents the values of this company, then I would be concerned about the people that hired him to sell "hospitality" in Z, and I would be especially concerned about any future interactions with this company. Frankly, If he was my spokesperson he wouldn't be any longer.

Note that you never once in this thread saw an apology, never once saw an attempt to have a meeting of the minds, never once saw a willingness to introduce other senior management to address my concerns, never once admitted that he may have gone to far in personalizing my postings. No this is what bad corporate choices lead to - it starts with hiring a spokesperson that is not only not qualified to serve the interests of his future clients & his company's mission (client hospitality). What is needed is a soft touch, not a heavy hand...!! Frankly, he appears to be over his head and he should just go back to managing the humble and very hard working constructions workers and stay away from any forms of social media.

To my fellow Z/I/T Message Board members/participants and the Host of this blog I sincerely apologize for the overall tone of this back-and-forth thread between myself & this supposed spokesperson for the new development at Sotavento. I'm officially done with this dude...cause ya know the old saying: never fight with a pig, because you will only get dirty and the pig likes it...!!

I've enjoyed reading and occasionally participating in your blog. Again I thank the host for his uncredited work. Hopefully we will bump into to one of you during our next annual visit. Zihuatanejo is one of the most beautiful places on earth - my family has been going there for over 15+ years (wow has it been that long). When planning our annual visits my friends, almost to a person, say "Mexico?, Mexico?, isn't it dangerous?", and I always respond by saying "I've been to many bad parts of Boston & LA, London, Spain & Ireland and ya know what they have dangerous places too , but Mexico, NO, we've never ever had any problems, you just need to stay in your own swim lane". The people of Mexico are humble & generous. The food is INCREDIBLE. This year, like every year, my family looks forward to a mid-afternoon lunch at El Murmullo, happy hour on the beach at Irma's, a cup of coffee at Loot (gee I hope they stay in business), our annual visit to the village to see what our favorite artist Ed (I hope that is his name - he never objects to us calling him that) has painted this year (he has T-Shirts now!!) and last but definitely but not least maybe a couple of delicious dinners & many Margaritas at one of the most romantic & breathtaking views on the Pacific Coast - La Escollera.

For the next few years will be more than likely just be renters in Z, and in time we will be owners. In the meantime it appears that we're going to be investing some of our set-aside real estate dollars in the city of Uclulet, BC Canada so that we can constantly enjoy it's Pacific Ocean beauty, while enjoying the rustic hike on the Wild Pacific Trail (check this place out - its fantastic).

Nos vemos pronto y ten un hermoso día, y un feliz 2019...!!! (please have someone traslade for the junior "spoksperson" - LOL!!)

Follow me on Instagram @ 30zenseconds...

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Sotavento Luxury Residences/LOOT

by Talley Ho @, Tuesday, January 01, 2019, 13:44 (142 days ago) @ DanCip

So, LOOT is going out of business? What do you know that the rest of us don't? Do share.

Sotavento Luxury Residences/LOOT

by DanCip, Tuesday, January 01, 2019, 15:35 (142 days ago) @ Talley Ho

No, oh god no. I'm just hoping they stay open... every time we've gone there (always coffee, once or twice for dinner) there has only been one or two people buying coffee. I love the vibe there and pray it stays open...

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Sotavento Luxury Residences/LOOT

by ZihuaRob ⌂ @, Zihuatanejo, México, Tuesday, January 01, 2019, 15:59 (142 days ago) @ DanCip

No, oh god no. I'm just hoping they stay open... every time we've gone there (always coffee, once or twice for dinner) there has only been one or two people buying coffee. I love the vibe there and pray it stays open...

Okay, so now I have this mental image of you praying at an altar that includes bottles of cerveza and tequila sitting amid sand and shells while smoke wafts from copal incense.

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Who do?

by ZihuaRob ⌂ @, Zihuatanejo, México, Tuesday, January 01, 2019, 16:28 (142 days ago) @ DanCip

No, oh god no. I'm just hoping they stay open... every time we've gone there (always coffee, once or twice for dinner) there has only been one or two people buying coffee. I love the vibe there and pray it stays open...

Okay, so now I have this mental image of you praying at an altar that includes bottles of cerveza and tequila sitting amid sand and shells while smoke wafts from copal incense. Is that Carlos I hear in the background? B-)
:jam:


https://youtu.be/j5AUm_xaE9A

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Sotavento Luxury Residences/LOOT

by Talley Ho @, Tuesday, January 01, 2019, 16:31 (142 days ago) @ DanCip

They have a brand new chef and menu as of about 2 weeks ago.....

Sotavento Luxury Residences/LOOT

by DanCip, Tuesday, January 01, 2019, 17:03 (142 days ago) @ Talley Ho

FANTASTIC...!! We should be down there for the Guitar Festival...,!!

Sotavento Luxury Residences

by DanCip, Friday, January 04, 2019, 12:35 (139 days ago) @ midalake
edited by DanCip, Friday, January 04, 2019, 14:43

Thanks for memorializing your thoughts for future buyers. I hope future buyers will read your pearls of wisdom and be NOW be able to make an informed & intelligent decision. Good luck with your day drinking..