More Development Comes to Southern Baja California Coastline
http://www.nytimes.com/2016/12/02/business/more-development-...
By KEVIN BRASS
DEC. 2, 2016
Cabo San Lucas, Mexico — David Lewis doesn’t yearn for the old days along the southern Baja California coastline, when the area was best known for
deep sea fishing, a smattering of resorts and the annual migration of spring breakers.
“When I started going it was more kind of raw,” said Mr. Lewis, a Southern California investor who started vacationing in Cabo San Lucas 23 years ago.
He remembers sweating in the un-air-conditioned airport and eating at roadside fish taco stands.
“It was a different place,” said Mr. Lewis, who is building an 18,000-square-foot custom home in Chileno Bay, a new 1,200-acre resort and residential
development. “Some people miss it. I don’t. I like the change.”
Today, Cabo San Lucas is developing as a high-end luxury destination, competing with Hawaii and the Caribbean for second home buyers. Not only is the
San Jose del Cabo international airport air-conditioned, on any given day private jets line the runway. Construction cranes dot the coastline, with
several new master-planned projects in development, each advertising modern villas, state-of-the-art spas and restaurants fashioned by world-renowned
chefs.
Homes in the new projects typically start at more than $2 million. The developments include a 1,400-acre project on the site of the demolished Twin
Dolphin hotel, which was once considered among the top resorts in Cabo; and the 834-acre Rancho San Lucas, with a Greg Norman-designed golf course.
The luxury chains Four Seasons, Ritz-Carlton and Nobu are also working on hotel and residential projects.
Part of a larger project, the Chileno Bay Resorts and Residences includes a boutique hotel and 33 villas, with prices starting at $2.25 million.
Credit Chileno Bay Resorts and Residences
“Even if you had been here two years ago, you wouldn’t recognize it,” said Julie Kershner, managing broker of 2 Seas Los Cabos, a real estate company.
“It’s shocking.”
Since 2012 prices for homes in some of the established luxury, gated communities have almost doubled, said Andrew Lemke, partner in Snell Real Estate,
another agency.
In the last year, 11 oceanfront properties sold in luxury developments for an average price of $12.6 million, compared with an average of $8.3 million
in 2014, he said.
In the last year, two homes in gated developments sold for more than $40 million, Mr. Lemke said. And in April the actor George Clooney and the
nightclub mogul Rande Gerber sold their side-by-side homes — called Casamigos, which is also the name of their tequila company — for $100 million,
according to media reports.
Even Hurricane Odile, which inflicted serious damage on the Cabo coastline in September 2014, did little to slow Cabo’s development trajectory. Many
resorts used the rebuilding effort as an opportunity to upgrade aging facilities.
“All the demographics and all the key drivers didn’t go away” because of Odile, said Mark Cooley, a partner in SV Capital Partners, the investment
group developing Chileno Bay Resorts and Residences.
Construction is almost finished on the pools and public areas for Maravilla Los Cabos, the primary residential section of the Twin Dolphin property
project. Credit Ohana Real Estate Investors
Almost all the buyers in the project are Americans, taking advantage of the ability to fly to Cabo in three hours or less, Mr. Cooley said. Part of
the larger master-planned Chileno Bay Golf and Beach Club project, the 22-acre Chileno Bay Resorts and Residences includes a 29-room boutique hotel
operated by Auberge Resorts Collection, scheduled to open in February and 33 three- and four-bedroom villas, with prices starting at $2.25 million.
Twenty-three of the 32 villas have sold, Mr. Cooley said. Most of the buyers are attracted to the sports and outdoor activities, including scuba
diving, kayaking, paddle boarding and mountain biking, he said.
“The healthy lifestyle is more important than the Cabo of the ‘90s, when people sat around the pool and drank margaritas all day,” Mr. Cooley said.
Not far from Chileno Bay, a California-based investment firm, Ohana Real Estate Investors, is developing the Twin Dolphin property, which will keep
the name of the old Cabo resort. Ohana bought the property in 2004, but put the project on hold in 2008, when the global market crashed.
“We said, let’s take a break,” said Neil Johnson, Ohana’s director of residential real estate.
Today construction is almost finished on the pools and public areas for Maravilla Los Cabos, the primary residential section of the project, where 230
villas and custom homes are priced from $3 million to $10 million. On another parcel, a hotel operated by Montage, including 52 residences, is
scheduled to open in 2018.
Buyers in the project tend to be “family-oriented,” arrive by private jet and have little interest in decorating. “The majority of people buying want
turnkey, furnished, ready to go,” Mr. Johnson said.
  
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