Sotavento Residences

by iluvzih, Monday, September 24, 2012, 08:34 (3121 days ago)

Does anyone have a update? No construction, no workers and security is gone.

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Sotavento Residences

by Linda from Canada @, Zihua and Grand Marais, Manitoba, Monday, September 24, 2012, 09:00 (3121 days ago) @ iluvzih

I pass by on the road almost every day- often see security. Maybe you caught them when they weren't readily visible? Workers on lunch?? Or perhaps they have shut down for some vacation time????it IS still the rainy season. I know when they were building our condo, they shut everything down for 2 weeks during the rain. Of course they also worked during the rest of the rain season.

--
Linda from Canada
check out my books at www.livingthedreaminmexico.com AND please have a look at www.cookingwithclaudiainzihuatanejo.blogspot.com as well as www.albertoinzihuatanejo.blogspot.com

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Sotavento Residences

by Fran @, Evanston, IL, Monday, September 24, 2012, 11:35 (3121 days ago) @ iluvzih

I recently got an update email from them assuring me that they were on track to be up and running in the near future and that I (once again) qualified for some spectacular pre-opening pricing on the unit of my choice.

It seems that the near future opening keeps getting moved further into the future.

Nothing in the email suggested they had stopped construction.

Sotavento Residences Update Sept 24 2012

by Epicres, Monday, September 24, 2012, 15:57 (3121 days ago) @ iluvzih

For accurate Sotovento Beach Villas( formerly Sotavento Residences) updates including construction photos please
bookmark

https://www.facebook.com/epicres

The Sotavento Residences website is no longer functional and we are attempting to have it taken down. For project specific updates email live@sotaventobeachvillas.com

Thanks in advance

Sotavento Residences

by Epicres, Monday, September 24, 2012, 16:45 (3121 days ago) @ iluvzih

Hello Keith if you are not a Facebook user then either email me when you want an update or visit

http://epicres.com/customer-learning-center.php

Where updates are posited as well in PDF download docs at least until we get the www.sotaventobeachvillas.com website fully functional

Cheers

Sotavento Residences

by Average Joe, Tuesday, September 25, 2012, 05:37 (3120 days ago) @ iluvzih
edited by Average Joe, Tuesday, September 25, 2012, 07:57

Does anyone have a update?

I cannot offer you “official” project status, but I can certainly “report” that veeeeery little work was taking place on a daily / weekly basis there for the entire time that I was residing next door at Catalina during this past May, June and July. Catalina staffers also “reported” that the same lagging construction had occurred for months prior to my arrival, and, appears to be but continuing as of my recent ‘peek’ over the Catalina wall.

One could easily predict that a lack of anticipated “pre-sales” and buyer down payment deposits might well be “handcuffing” requisite Developer cash flow to underwrite normal, or even accelerated production schedule deadlines. That type of ‘rollover’ project financing is common in México, as are the completion deadline problems frequently accompanying that limited approach to project financing.

And while Caveat Emptor is an indispensable ‘battle cry’ here in México in general, I personally would be leery for numerous reasons about planning a move-in (let alone anticipating rental income) on any property that has been subject to repeated construction delays.

At MINIMUM, you could foreseeably be subject to rather endless ‘Quality of Life’ disturbances from repeatedly postponed construction completion dates, including the ongoing building noise, the continual air-born construction dust, the general living-context ‘shabbiness’ amid unfinished construction (hence services), the constant interruption by incessant site tradesman and construction crew machinery, let alone the lack of peace, quiet AND privacy that “could” drag-on indefinitely if construction completion delays continue. And THAT project appears to be a ways away from any reasonable “final completion”.

Am I wrong here? If not, then the ‘Dust Factor’ ALONE even in the short term would predictably drive ya nutz…… DAILY!! :fiddle:

[image]
PS: To my knowledge, there is little (if ANY) legal means in México for a new owner to justifiably receive financial compensation in the wake of such aforementioned personal disturbances and/or loss of rental income due to construction delays and failed completion deadlines, with the latter usually represented at "the point of purchase".

Thoughts?

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Sotavento Residences

by Fran @, Evanston, IL, Tuesday, September 25, 2012, 10:14 (3120 days ago) @ Average Joe

We went over to Sotavento when the sales office and first model went up to see what the deal was. Curiosity after all those years. A couple of things struck me. First was how little deposit money it took to "hold" the unit of your choice and second, that that small sum was fully refundable.

I know that developments want to have those first units "committed"quickly so that it appears that the development is selling like wildfire. I get that. But the full down payment didn't need to be committed until you actually purchased the unit. And I don't recall that you had to do that until closer to the time the unit was actually completed and ready to close.

I would think that would eventually create a cash flow problem. If you can't get more of a commitment than a modest refundable deposit, you are pretty heavily reliant on investors rather than owners to get the thing built.

Perhaps I misremember the facts and I don't mind standing corrected. But we didn't leave feeling that this was going to be a very quick deal.

Sotavento Precedences

by Average Joe, Tuesday, September 25, 2012, 11:19 (3120 days ago) @ Fran

Perhaps I misremember the facts.... But we didn't leave feeling that this was going to be a very quick deal.

I haven't a clue as to 'their' specific funding structure, as I am nowhere NEAR 'a condo person'. But if history is of any import, then I would guesstimate that Sotavento Residence's initial start-up capital sorta got exhausted some time back, thus potentially relying in large part upon subsequent sales to fund the continued, post-investor capital needs.

Predictably waning sales in our (now GLOBAL) Post-Lehman's World may certainly account for less-than-optimal cash flows, which may in fact be the reason for their obviously stalled buildout.........?????

If so, then the Developers may certainly / empathetically be caught “between a rock and a hard place”, as I would further guesstimate that many ‘would-be’ buyers are taking a “wait and see” posture, while postponing actual fully-funded buy-ins until such time that the aforementioned move-in “Quality of Life disturbances” are foreseeably at a minimum time wise……!

[image]
IE: "The Light At The END of The Tunnel" for essentially the reasons previously suggested of proactively AVOIDING living in what boils down to an Ongoing Construction Site.

I know that I WOULD....! :-o

Sotavento Residences questions concerns

by seattlejim, Sunday, January 06, 2013, 19:19 (3016 days ago) @ Fran

My first post but have been a reader on Zihua Rob’s board for many years.
The Sotavento was our place to stay for many years (95’ to 07’) prior to its sale to 20/20. I have been thinking about buying a unit however from what I can tell units are not complete and construction will not be done for at least another year++ due to financing issues, etc. I found a investors report on this development of interest: http://www.fasttrackcapital.com/resources/invupdate_Nov292012v2.pdf

My concern is the financial issues and carrying costs of this investment, which in the beginning it was to be completed by 2009 at a profit.
Many of you have placed down payments or purchased in this development, and would appreciate any updated insight from anyone as we are very interested in buying if my data is incorrect around progress, completion, units sold, etc.
I have read from neighbors next door or behind the Sotavento that the project was completed which conflicts with other posts I have read.
Thanks for your insight and info

Sotavento Residences questions concerns

by Epicres, Sunday, January 06, 2013, 20:54 (3016 days ago) @ seattlejim

I am replying to the post by Seattlejim about construction and financing at Sotavento. Here are two possibilities one of which will happen in the next short period of time.

1. There will be a buyout of the current debt at a discount that will be profitable to the new owners just like every other recreational property in both Canada and the US has experienced since the 2008 meltdown and a new group to complete the project or
2. New financing based on a very positive income and revenue opportunity report provided by HVS (Hospitality Valuation Services) http://www.hvs.com/ when the project is complete.

My company works on recreational real estate projects all over North America and is intimate with Sotavento. Here is what Sotavento has over all other projects we've worked on in years

- The location is unmatched and in one of the best beach locations in Mexico
- Values are holding and with the addition of a fractional offering will get better
- There is no other competitive product unlike Ixtapa or other locations that have an over supply of condos

Is it worrisome that the project hasn't completed yet? Of course but always follow good real estate and you win. Anybody who bought in early has built in equity based on current prices that have been substantiated by two new reservations we accepted this week. My advice is hang in, this will work out and we will do a better job communicating moving forward. In fact bookmark www.facebook.com/epicres and you can get real time updates.

Saludos
Mark W

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Sotavento Residences questions concerns

by rickstark32 @, minnesota, Sunday, January 06, 2013, 21:07 (3016 days ago) @ Epicres

"substantiated by two new reservations we accepted this week"

But what does that really mean? In the past you could "reserve" a unit with very little money to hold it for a year and
after that year either complete the purchase or cancel your reservation and get your money back. Unless the protocol for reserving a unit has changed, it means nothing as far as units sold that will provide capital and move the project toward completion.

Sotavento Residences questions concerns

by Epicres, Monday, January 07, 2013, 08:27 (3016 days ago) @ rickstark32

Here is what a reservation means today

We've booked 2 new firm reservations that are only refundable if for some reason project financing doesn't come together with a 5% deposit essentially a contingent purchase agreement. Good enough for a lender to consider as part of a refinance

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Sotavento Residences questions concerns

by Zmon01 @, Wednesday, January 09, 2013, 18:12 (3013 days ago) @ Epicres

Where is THE lender from? If from the US or even MEX. >good luck?:spank:
Sure. If you need a loan, probably NOT a wise decision?:omg:

Sotavento Residences questions concerns

by Epicres, Thursday, January 10, 2013, 17:07 (3013 days ago) @ Zmon01

Finding lenders no question has been challenging but they are there typically for this project an entreprenurial group group that has an debt and equity position and knows the area

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Sotavento Residences questions concerns

by Zmon01 @, Thursday, January 10, 2013, 17:14 (3013 days ago) @ Epicres

If 40% of the units are sold, where did the money go? It's starting to smell a little stinky?

Sotavento Residences questions concerns

by Epicres, Thursday, January 10, 2013, 17:29 (3013 days ago) @ Zmon01

40% with cost over runs that always occur still requires financing with a
typical margin of 20% perhaps your question would be more appropriate if
80% of the building was sold and completed

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Sotavento Residences questions concerns

by Zmon01 @, Thursday, January 10, 2013, 19:55 (3012 days ago) @ Epicres

Not at all. Why did you guys even start this project in the first place? We all know you are under capitalized to start with, but relying on presale deposits to build it? Sheesh> no wonder there's no workers around.

Sotavento Residences

by Mountain Ash Farm, Saturday, March 15, 2014, 11:51 (2584 days ago) @ Average Joe

We are owners - r u? we live in Toronto area. Do you know any others?
Please let us know if there is an owners group, as we should collect names.
Ron and Patti PIRIE
c/o Mountain Ash Farm - MtAshFarm@live.com

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Sotavento Residences

by Zmon01 @, Sunday, January 06, 2013, 20:10 (3016 days ago) @ iluvzih

Just a guess? But seeing this project in the works for 3 yrs. now, appears the developer's ran out of money for completion? Hope I'm wrong.

Sotavento Residences

by Epicres, Sunday, January 06, 2013, 20:58 (3016 days ago) @ Zmon01

That's why new financing is needed what's new look at what has happened economically in the past 4 years

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Sotavento Residences

by Zmon01 @, Sunday, January 06, 2013, 21:15 (3016 days ago) @ Epicres

I know>2008 was a bitch? But if I put money down on a unit back then and nothings happened since, I'd be real pissed! Time to find some money and git r done?

Sotavento Residences

by Epicres, Monday, January 07, 2013, 08:26 (3016 days ago) @ Zmon01

We're working on getting it done!

See my post earlier

There have been 3 price increase since the project was launched. Roughly 40% of the building is sold with firm contracts and completed sales. ALL sales booked are for less than the current price list. Increases are from several thousand to over $100,000. Buyers who purchased early have been rewarded with great pricing and receive an accruing interest payment on there money to be credited at closing.

I've met 9 different owners over the past 2 weeks. All would like to be using their unit but none have expressed any interest in not completing because they are concerned about values.

We've booked 2 new firm reservations that are only refundable if for some reason project financing doesn't come together with a 5% deposit essentially a contingent purchase agreement.

Cheers
Mark

Sotavento Residences

by seattlejim, Sunday, January 06, 2013, 21:53 (3016 days ago) @ Epicres

Thanks Epicres for the reply and glad there is a push to find funding (curious how long they have been looking) for this project makes sense based on the investors link I found as none of them were paid.
However the one statement you made on “built in equity” regarding early buyers, I cannot believe that any of them that have purchased a unit has any upside equity due to global markets including Mexico.

If you have data that can show how anyone would be above their initial investment I would love to see it as well would like to see exactly how many units have been sold (by unit number and amount).

I don’t see any escalation of pricing based on the anemic growth and new tax polices being imposed.

I will look forward to seeing more of your posts and a positive outcome.
SJ

Sotavento Residences

by Epicres, Monday, January 07, 2013, 08:22 (3016 days ago) @ seattlejim

Hello seattlejim

There have been 3 price increase since the project was launched. Roughly 40% of the building is sold with firm contracts and completed sales. ALL sales booked are for less than the current price list. Increases are from several thousand to over $100,000. Buyers who purchased early have been rewarded with great pricing and receive an accruing interest payment on there money to be credited at closing.

I've met 9 different owners over the past 2 weeks. All would like to be using their unit but none have expressed any interest in not completing because they are concerned about values.

We've booked 2 new firm reservations that are only refundable if for some reason project financing doesn't come together with a 5% deposit essentially a contingent purchase agreement.

Good real estate sells in any market condition. I guess you would know that being in real estate yourself.

Cheers
Mark

Sotavento Residences

by Average Joe, Monday, January 07, 2013, 09:41 (3016 days ago) @ seattlejim

If you have data that can show how anyone would be above their initial investment I would love to see.....

Well-queried all the way around, Jim.

The fact that your queries went specifically unaddressed here (and even “answered” with a mere copy-n-paste reply from an earlier post) should tell ya sumthun!!

The sheer inability of this ambitious project to obtain requisite lender financing itself (in ANY market) should ‘tell ya sumthun’, too, as should the very quote from your linked-to investor update (broad-brushed) website, “20/20 Mexico is actively pursuing various alternatives to obtain financing to complete construction and jump start the sale of units, and is also pursuing an outright sale of the project……

Even in its present 'unscrubbed' condition, THAT sounds to me as though someone is sadly soapin-up to ‘take a bath’, amigo, as indelibly caught in The Same Boat that we ALL have been (rather fervently ) rowing for now Five Years!!

All said, my heart certainly goes-out to Mark and to anyone pegging their personal incomes solely to SR sales commissions (aka: on The Mexican Dream )!

Ditto to any buyers anticipating a lucrative ROI on a flip anytime soon…….

Sotavento Residences

by seattlejim, Monday, January 07, 2013, 11:08 (3016 days ago) @ Average Joe

Thanks Joe for the feedback, this is all part of some DD I have been doing. Without having to fly back down this blog has been a good resource, so again thanks.

We truly loved the old place (and the steps) as many of you did and was sadden when I heard it was going to change. But hoped as many that the transition would be short and swift and could have never imagined the financial nightmare that affected everyone. I am glad I listened to my wife and didn’t jump in back in 2008.

I started a few months back looking for a place and not rent out however my gut-DD is telling me to wait due to all of the data presented and or look elsewhere.
If you look at the comments mentioned by the firm (Fast Track Capital) they had other US based developments/investments that were right side up so Mark is correct as there are good investments out there.

Bottom line is on this property I added all of this up (Financials, suspected sales, carrying costs, fees, current management (in flux), construction delays, current market conditions, foreign investment, etc..) and the cons out way the pros. When buying a condo it must have a solid financial background or you could end up walking into a long term nightmare.
Thus we will buy into a property that has a long term solid management team, processes in place as well funds to cover maintenance without having to increase annual fees which is a concern as this property is upside down so as they say in Devil's Den "with that I’m out".
FYI the Vancouver and Whistler markets are going through their housing melt down now which could be part of the problem via 20/20.
It will be interesting to see who steps and buys the debt, I hope to circle back in 6 months to see this is back on track.
SJ

Sotavento Delinquences

by Average Joe, Monday, January 07, 2013, 11:44 (3016 days ago) @ seattlejim

When buying a condo it must have a solid financial background or you could end up walking into a long term nightmare

Certainly agreed Jim, et al…… as I reread my original thoughts on this thread from four months ago now.

Though, the rumored Operative Mechanics of how that project apparently got ‘hatched’ from the gittgo, might in itself leave something to be desired.

NTL, please PM me off-line IF your ongoing research HAS uncovered any Respectable ROIs with even the slightest hint of “reliant predictability” mate…… as suitably available to we Global Citizens (aka: we mere ‘average joes’ !!).

Sotavento Residences

by Mountain Ash Farm, Saturday, March 15, 2014, 11:48 (2584 days ago) @ iluvzih

We are owners - r u? we live in Toronto area. Do you know any others?
Please let us know if there is an owners group, as we should collect names.
Ron and Patti PIRIE
c/o Mountain Ash Farm - MtAshFarm@live.com