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Mexico wooing U.S. investors

 By Chris Markham
Special to the arizona daily star
Tucson, Arizona | Published: 05.03.2007
Tucson conference stresses opportunity that real estate offers to a baby boomer, it may just be a summer place or a second home. But to Mexican tourism officials and real estate developers, it's much-needed economic development.

Our economy cannot sustain itself," said Mauricio Monroy, a Tijuana-based accountant who helps connect U.S. investors with Mexican developments near the border. "We need foreign investment." That's the idea Mexican government officials, as well as representatives of real estate and tourism developers, were selling this week during Ventana de Mexico, a three-day conference that began Tuesday at the Westin La Paloma Resort & Spa to help match American money with Mexican investment opportunities. More and more Americans seem to be buying into the idea each year. Private investment in the state of Baja California has soared 629 percent since 2002, said Alejandro Moreno Medina, secretary of tourism for Baja California. "Instead of ranches, we want to convert to tourism," Medina said. And officials and developers in Sonora, the Mexican state that borders Arizona, expect to see visitation grow by 10 percent by 2009 to 9.6 million people — 70 percent of whom come from Arizona. Today, Sonora has around 5,000 housing units built or under construction primarily for sale to foreign investors. But officials there expect that to grow to 40,000 units in the next 20 years, said Epifanio Paulovich, secretary of tourism in Sonora. Retirees looking for warm beachfront properties are finding their dollars stretch much further in Mexico, especially compared with similar property along the California coast. Lots in Parayso, a master-planned golf and beach community about to break ground about 50 miles south of Rocky Point, will start at around $200,000 for a third of an acre. Comparable lots in Southern California would run millions, said David Koelling, a sales associate with the project. Mexican officials know they'll need to boost infrastructure, especially roads, to attract more second-home buyers. Work on a new highway running from near the U.S. border south to Puerto Peñasco, or Rocky Point, is about 80 percent complete. And the Mexican government is planning to extend that highway farther south in coming years, Paulovich said. A major part of selling real estate to Americans is overcoming their fear of doing business in Mexico. They often wonder whether the Mexican government will even allow them to own property, said Fred Young, a Scottsdale-based broker who conducts monthly seminars for would-be buyers. But in many ways, owning property in Mexico works the same as in the United States, Young said. Technically, the Mexican constitution prohibits foreigners from owning property within about 30 miles of the coast and about 60 miles from the borders. But Americans have been buying land in Mexico for years, using real estate trusts held through Mexican banks, Young said. And several U.S. title insurance firms now cover Mexican land deals, guaranteeing American investments, Paulovich said.

Published Friday, May 4, 2007 6:18 PM by Kanoa Biondolillo

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