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oldhippie
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[*] posted on 8-28-2007 at 03:55 PM


Quote:
Originally posted by bajalou
Quote:
Originally posted by oldhippie
"Many of these homes are longer term investments for gringos and will be rented to those working in these towns (service industry)."



So do like they do in other areas - rent to the Time Share and Real estate sales people. And all the other hanger on's that show up in town when it's growing.
:biggrin: :saint:


don't attribute that quote to me - that's cajhawk's idea. Your idea might work, there's a sucker born every minute.

But the boom is over and a lot of suckers have been suckered in. Selling/renting these places is going to be hard work. Any fool could have sold real estate in the past 5 years, looks like things are swinging back to normal.
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[*] posted on 8-28-2007 at 04:21 PM
Clarify


Tough crowd! What I am talking about is the people who buy homes for use in 5 to 10 years in Nopolo that can rent it out for some (small) cashflow. Service employees was meant as people who work in the Beach Club, own shops, etc. These are usually gringos who want to work and live in Baja but don't want to buy anything. These are a lot of the "service" type jobs I'm talking about. Am I wrong? Do you think a huge influx of Mexican Nationals are going to move to Loreto because of a few thousand people in Nopolo? I don't. Many who buy second homes or retirement homes are looking for when they can use them in the future, not today. That hasn't been the dynamic in Loreto before, but will be with LB to some extent.
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[*] posted on 8-28-2007 at 05:42 PM


Are you wrong? Yes....
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[*] posted on 8-28-2007 at 06:03 PM


I am only here briefly but I printed up the desal report and it is an eye-opener.

From this link: http://www.pacinst.org/reports/desalination/index.htm (PDF file)

I printed up this desal report and am still reading it but here are some highlights that caught my eye and may cause some discussion. I’ll put them below:

Page 23:

Box 3: The Experience of the Tampa Bay Desalination Plant 7

In March 1999, regional water officials in Florida
approved plans to build an RO plant with a
capacity of 25 MGD (95,000 m3/d). Claims were
made by project proponents that the cost of water
would be very low and competitive with other local
sources. The project and the apparent breakthrough
in price excited desalination advocates.
The desalination facility was to be privately owned
and operated and upon completion would supplement
drinking water supplies for 1.8 million retail
water customers. The plant was considered necessary
to help reduce groundwater overdraft and to
meet future demands.

The planning process for the plant began in
October 1996. In early 1999, Tampa Bay Water
selected S&W Water, LLC, a consortium between
Poseidon Water Resources and Stone & Webster.
Their proposal called for construction of the plant
on the site of the Big Bend Power Plant on Tampa
Bay to begin in January 2001, and for operation to
begin in the second half of 2002 (Heller 1999,
Hoffman 1999). A total of 44 MGD (167,000
m3/d) of feed water would be used to produce
around 25 MGD (95,000 m3/d) of potable water
and 19 MGD (72,000 m3/d) of brine. The desalinated
water would then be added to the municipal
supply.

The agreement called for desalinated water to be
delivered at an unprecedented wholesale cost of
$1.71 per thousand gallons ($1.71/kgal), or $0.45
per cubic meter ($0.45/m3), for the first year, with a
30-year average cost of $2.08/kgal ($0.55/m3)
(Heller 1999). Southwest Florida Water
Management District (SWFWMD) agreed to provide
90% of the projected $110 million in capital
costs for construction of the plant and the cost of
the pipeline needed to transport the water to the
water-distribution system (U.S. Water News 2003,
Heller 1999).

The project has been fraught with difficulties, and
as of May 2006, it is still not in operation due to
serious management and technological failures. A
number of contractors declared bankruptcy, forcing
Tampa Bay Water to purchase the plant and
assume full risk. Excessive membrane fouling was
also problematic, decreasing the life of the membranes
and increasing costs. The plant also violated
its sewer discharge permit because additional chemicals
were needed to clean the fouled membranes.
In November 2004, Tampa Bay Water agreed to a
$29 million, two-year contract with American
Water-Pridesa (both owned by Thames Water Aqua
Holdings, a wholly owned subsidiary of RWE) to
get the plant running. Tests revealed that membrane
fouling was still a problem and many of the
water pumps had rust and corrosion problems.
Both problems have been attributed to cost-cutting
(Pittman 2005).

To further complicate matters, SWFWMD threatened
to withhold financing for the plant because of
a disagreement with Tampa Bay Water about the
capacity at which the plant would operate. In
January 2006, the water authorities agreed that the
plant could be operated at less than full capacity as
long as groundwater pumping was reduced.
Environmentalists and activists strongly opposed
the deal because they “felt cheated” (Skerritt
2006).

American Water-Pridesa expects the plant to open
in late 2006 for another assessment period, after
$29 million in repairs are finished, and expects the
plant to be fully operational in January 2008, six
years late. In a press release issued in early 2004,
the new cost was estimated at $2.54/kgal ($0.67
per m3), up from an initial expected cost of
between $1.71 and $2.08/kgal ($0.45 to $0.55/m3)
(Business Wire 2004). The recent decision to reduce
the amount of water that the plant will produce
and additional unforeseen problems will likely
drive the price up further.

Careful examination of the project’s cost claims
should caution desalination advocates against
excessive optimism on price, and indeed, cost-cutting
is in part responsible for the project’s difficulties.
Moreover, the project had a number of unique
conditions that may be difficult to reproduce elsewhere.
For example, energy costs in the region are
very low – around $0.04 per kilowatt-hour – compared
to other coastal urban areas. The physical
design of the plant – sited at a local power plant –
permitted the power plant to provide infrastructure,
supporting operations, and maintenance functions.
Salinity of the source water from Tampa Bay
is substantially lower than typical seawater: only
about 26,000 ppm instead of 33,000 to 40,000
ppm typical for most seawater. In addition,
financing was to be spread out over 30 years, and
the interest rate was only 5.2 percent (Wright
1999).

7 A more detailed review of the Tampa Bay
plant is provided in Appendix C, online at
www.pacinst.org/reports/desalination.



And here’s a coupla Zingers for you from the article too…

from page 66:

“Desalination project
proponents who claim
an environmental
benefit from their
project need to
describe the binding
mechanism by
which product
water will become
“environmental water”
rather than a new
source of supply for
future demand.”

Page 71:

“Experiences in Tampa
Bay and strong interest
by the private sector in
California highlight
additional need for
transparency and
accountability.”

Their conculsions also seem to mirror my concerns

“Perhaps the greatest barrier to desalination remains its high economic
cost compared to alternatives, including other sources of supply,
improved wastewater reuse, and especially more efficient use and demand
management. We do not believe that the economic evaluations of desalination
commonly presented to regulators and the public adequately
account for the complicated benefits and costs associated with issues of
reliability, quality, local control, environmental effects, and impacts on
development. In general, significant benefits and costs are often excluded
from the costs presented publicly. California should pursue less costly, less
environmentally damaging water-supply alternatives first.

Is desalination the ultimate solution to our water problems? No. Is it
likely to be a piece of our water management puzzle? Yes. In the end,
decisions about desalination developments will revolve around complex
evaluations of local circumstances and needs, economics, financing, environmental
and social impacts, and available alternatives. We urge that
such decisions be transparent, honest, public, and systematic.”

---------------------------
Here’s the organization and their website, interesting stuff:

Pacific Institute
654 13th Street
Preservation Park
Oakland, CA. 94612

http://www.pacinst.org
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oldhippie
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[*] posted on 8-28-2007 at 06:42 PM


and when you think about it for than minute you realize there's much more in coastal seawater besides H20 and NaCl. All the animals, both alive and dead, their excrement, dirt, chemicals from runoff, sewage, other dissolved minerals, and who knows what else has to be filtered out or chemically eliminated. It's a wonder that filters so small to block salt molecules and allow water molecules through don't get immediately clogged up. But I guess it works, sometimes, sort of. Distillation seems more workable, but it's expensive.

Plus nobody knows the recharge rate of the aquifers in the Loreto area. They could be running dry now with the current population. If so desalination will be the primary source of water.

Also, I read a post on another website by an American who once worked for Loreto Bay that the gray water system isn't being built. That's a completely different plumbing system built to water landscaping and perhaps to flush toilets. So if it's true, potable water will be used.

And there's the general notion that making something so vital as potable water much more dependent upon the burning of fossil fuels is just a dumb idea from the get go.


[Edited on 8-29-2007 by oldhippie]
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flyfishinPam
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[*] posted on 8-29-2007 at 07:53 AM
Letter to the Pacific Institute


To whom it may concern,

I am a resident of Loreto, Baja California Sur, Mexico and have come across your organization as a source of information on the desalination process in California, USA. I am currently reading the report "Desal with a Grain of Salt".

I don´t know if you have ever heard of our town but we´re located 700 miles south on highway one on the Eastern side of the Baja Peninsula on the Sea of Cortez. Within the last four years this has become a boomtown for real estate, speculation and mega development. This concerns many citizens here because we have a very limited water resource, the San Juan Londó aquafer 30 miles to our North, in the mountains.

The first and largest developer is about four years into their project and is planning on constructing 6000+ retirement homes and hotel rooms 9 miles away from a town of 13,000 (our town has since grown to 17,000). They are marketing their properties as a sustainable village and have published the fact that they were granted all the water rights of the San Juan Londó aquafer by the government. However they claim that they will produce more water than they consume and plan to do this various ways, the main being desalination.

without going into too much detail, the page II in your grain of salt report states:

"The Pacific Institute strives to improve policy through solid research and consistent dialogue with policy makers and action-oriented groups, both domestic and international. By bringing knowledge to power, we hope to protect our natural world, encourage sustainable development, and improve global security."

When I read this I think that I am addressing the right organization. I value your comments and look forward to further correspondence with you.


signed
resident of
Loreto, BCS MEXICO
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oldhippie
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[*] posted on 8-29-2007 at 09:10 AM


Pam,

Excellent idea. You may want to mention that Loreto Bay claims that the Pacific Institute recommended the desalination "system of choice" for the development. I've always wondered whether or not this is true. If it's not true, I imagine the Pacific Institute would not be happy about the claim.

See page 5

http://www.loretobay.com/loretobay/LBC%20Sustainability%20Ov...

Ask them about it. It will get their attention.
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[*] posted on 8-29-2007 at 09:17 AM


cajhawk: "the people who buy homes for use in 5 to 10 years in Nopolo [the 'Village"?] that can rent it out for some small cashflow" ?? Is it true that most of the rentals in LB village are to the full time employees of LB Co.? What percentage of the 150 homes are vacant? Of the full-time homeowners, do they intend to live there 365 days/year? Who else, then, will be renting long-term (since it is a fact that there is no short term rental, and requisite management of such) offered or available? The rentals are $1,200-2,000/mo. Who wants to rent at Nopolo for those prices with ongoing noise and dust from construction surrounding them, miles from the authenic Mexican town of Loreto which has all servcies and amenities available to them versus the nothingness that the Village offers now (with no definite plans for stores or staffed, stocked facilities in the future)?
"Many who buy second homes or retirement homes are looking for when they can use them in the future, not today." This is what you tell your clients, I presume. And you blithely tell them they can rent it out in the meantime when there is no viable, proven business plan for such a statement. "That has been the dynamic in Loreto before, but will be with LB to some extent." Again - says you - without any qualification for such a statement.

The monthly rent is too high for local Mexican citizens who work in Loreto.
The monthly rent is too high for east coast gringo snowbirds.
The majority of gringo snowbirds, or Canadian snowgeese live in RVs parked in RV lots.
The LB Village is not finished and has no amenities, which makes it a poor choice for someone who is willing to pay $1,500 per month to rent a dwelling long term (more than 4 months), thus the competitive nature of that rental market will keep renters at LB Village at bay.
The the people who will own shops and work at the Beach Club at LB Village - wouldn't they be Mexicans living in Loreto (see Point No. 1 above)?
How many retail shopkeepers are you talking about? When will ALL of the shops be built? For that matter, when will the Beach Club be finished, stocked with towels, liquor and sunscreen and lounge chairs for ANY of the residents there? Whose employees will they be? Paid for by HOA fees (as with property management companies hired by HOAs?), or independent contractors?
As you know, all amenities and common areas of the Village will need to be paid for by the HOA fees of the homeowners. This will get more and more and more expensive as "build out" occurs. What is the limitation on HOA fees? None you say? How much money does it take to fund a small village of 6,000 units, with an estuary, 2 golf courses, non-native landscaping everywhere, an orchard, RO water facility and its staff, etc.? Where is the Village HOA budget and financial statement with proposed future expenses? When the 1,000th homeowner considers purchasing a unit, and finds out the HOA dues are $1,000/mo., do you think this will be a deterrent in choosing to buy?
Have you analyzed today's real estate market in Florida, i.e., overbuilding, overpriced, glut of homes sitting empty, new construction with high costs, thus high rent - most with concomitant required golf course fees? Do you see parallels with the Baja CA. real estate market? The point being that, yes, maybe LB Village will be built (or continue to be built for a while until people wise up), but does that mean that people will be living in them and paying for them? Read: bank-owned foreclosure, vacant, no HOA fees leading to decline and ruination of the development - as is the case in Florida and elsewhere. After all, it is the homeowners who will be paying for everything - not the tax base derived from the Loreto citizens.
Tell me the facts that will contradict this analysis.
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[*] posted on 8-30-2007 at 02:25 PM


The people who will rent homes in LB will be friends of people who bought, in many cases Snowbirds. They do so because they want to be close to their friends. People will also stay out in Nopolo because of a lack of rentals in Loreto proper.

I respect your opinion, but the comparison of Florida and Baja is not a good one IMHO. Loreto Bay homes are being paid for in cash while in FL most were heavily leveraged. Bank foreclosures for unpaid dues just aren't going to happen with that kind of investment,whereas they will happen a lot when people get upside down on a mortgage.

I don't think that $1500 a month for a house in Loreto Bay is terrible for snowbirds. My in laws spend $1300 per month to stay outside of Palm Springs in a "park model" mobile home. If they had friends in Loreto they would be thrilled to stay at LB instead. Prices for rentals have gone up everywhere and Loreto seems to be a value for ocean property to many compared to other places in the States. One of my best friends rents out their place in Punta Nopolo about 50% of the time, so I know that there is SOME market for independent rentals.

I for one don't think that LB is going to be a "ghost town". It may not develop all of the units and may not be an economic success for the builders, but that is a far cry from an abandoned ghost town. Time will tell if you or I are right about this!
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[*] posted on 8-30-2007 at 03:31 PM


Yes, Time Always Tells Everything ......



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oldhippie
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[*] posted on 8-30-2007 at 07:30 PM
Loreto "Rube Goldberg" Bay


A part of the Rube Goldberg award winning Loreto Bay plan is a wind powered electric generating station on the other side of the peninsula in a just above marginally windy area. The facility doesn't exist, and who knows if it ever will. But it is going to supply all the electricity the development needs, maybe.

Well, maybe not. This is from the German magazine Der Spiegel. Germany is the world leader in wind power.

"After the industry's recent boom years, wind power providers and experts are now concerned. The facilities may not be as reliable and durable as producers claim. Indeed, with thousands of mishaps, breakdowns and accidents having been reported in recent years, the difficulties seem to be mounting."

http://tinyurl.com/23kkfq

Rube was an amazing person, I think.

http://en.wikipedia.org/wiki/Rube_Goldberg

Here's a modern Rube Goldberg machine to open curtains. Have fun!

http://www.flixxy.com/best-rube-goldberg-machine.htm
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[*] posted on 8-31-2007 at 06:35 AM


Pam, the report from Tampa Bay indicates some really serious problems with their desal plant. But we should not worry, that was a problem in the United States with the EPA and the Florida State Dept. of Health, Water Quality Control Division breathing down their necks. What Loreto Bay will do is to dump this stuff right back into the sea and when we see serious depletion of sea life and ocean ecosystem, LB will obviously deny any wrongdoing on their part. If LB can somehow come up with the rights to the entire San Juan Londo aquifer, then a little bit of dumping brine should really present no major obstacle.
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[*] posted on 8-31-2007 at 07:03 AM


"If LB can somehow come up with the rights to the entire San Juan Londo aquifer, then a little bit of dumping brine should really present no major obstacle."

I hope everyone understands the sarcasm in that sentence.
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[*] posted on 8-31-2007 at 07:11 AM


I drove through Loreto Bay 2 weeks ago, ugly is the only word to describe the attached housing. All the units I saw had common walls with their neighbors, a very small front entry or kind of court yard maybe 5'x15' or none at all just a front door right on the street. My wife said it reminded her of France, maybe thats why we say so many French and Itialian tourists. Selling this mess in Europe.
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[*] posted on 8-31-2007 at 07:35 AM


Quote:
Originally posted by cajhawk
I don't think that $1500 a month for a house in Loreto Bay is terrible for snowbirds. My in laws spend $1300 per month to stay outside of Palm Springs in a "park model" mobile home.


Loreto vs. Palm Springs?? That's apples and oranges. $1300 in Palm Springs is a much better deal than $1500 in Loreto for people who enjoy a Palm Springs like winter retreat.

Think about it, there's no services in Loreto. What happens if one of your in-laws get seriously ill or has a bad accident in Loreto? Or, perhaps they want to watch a football game in English? Or maybe want to read a newspaper? Or want to go to a movie? Or have banking needs above an ATM withdrawal? The list is endless.
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[*] posted on 8-31-2007 at 09:00 AM


Si, living in a foreign country isn't for everyone. And getting there is an added expense as well.

"If they had friends in LB" - correct. When you move to Mexico you leave your family and friends in the USA behind. A major undertaking for someone to come visit you. And in Palm Springs you can:
drive your own car around
not have to separate your recycleable trash
Not have construction going on around you every day for the next 10 years
Walk to the corner grocery store for a bottle of California wine

Canadians, potential buyers of LB: Check out Palm Springs for your retirement digs, affordable 2nd home getaway: multiple golf courses; aerial tram to famed Mt. San Jacinto for mountain hiking and snowshoeing, nearby hotsprings and canyons offer relaxation; high end shopping, complete with water misted sidewalks for your strolling comfort; only minutes away from the mountain retreat of Idyllwild; Joshua Tree state park in your backyard; swimming pools, hot tubs, massage therapists galore.

LB homes are paid for in cash? Get real. Where do you think the cash comes from? Are you saying nobody can get a loan to buy an LB Village unit? Would definitely limit the number of buyers with $300,000 ready cash. Many of the units in LB were purchased on speculation -- buyers hoping to flip when construction was finished. True? Yes, time will tell.

And I just can't help going back to this one point: If LB was initially relying on the San Juan acquifer for its water supply because FONATUR told them it would be adequate, but then later decided to supplement the water supply, then why did they - from DAY ONE - promise that "by the end of the project we will harvest or produce more potable water than we use." You can't tell me with a straight face that building a few check dams so that some indefinite amount of rainwater might (or might not) filter into the acquifer and be available maybe 50 years from now is their plan to harvest potable water. Would you please tell when "the end of the project" will be?
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[*] posted on 8-31-2007 at 09:22 AM


Quote:
Originally posted by Pescador
Pam, the report from Tampa Bay indicates some really serious problems with their desal plant. But we should not worry, that was a problem in the United States with the EPA and the Florida State Dept. of Health, Water Quality Control Division breathing down their necks. What Loreto Bay will do is to dump this stuff right back into the sea and when we see serious depletion of sea life and ocean ecosystem, LB will obviously deny any wrongdoing on their part. If LB can somehow come up with the rights to the entire San Juan Londo aquifer, then a little bit of dumping brine should really present no major obstacle.


I´m not finished reading this report yet (3/4 of the way through it) but I am finding some serious concerns that will need to be presented in the planning stages of a desal plant. One thing to consider is the power grid. The Pacific Institute recommends for reasons of cost and infrastructure sharing, that a desal plant be located next to an existing power plant. The existing power plant for our area is in San Carlos on the East side of Magdelena Bay. And the wind power plant will also be located on the other side of the peninsula which will pose a cost and infrastructure problem.

One burning question I have before I leave here and during the read of this report is, how much water will this proposed desal plant be producing? I don´t think I ever saw the answer to this question anywhere. The amount that will be produced has a huge bearing on how much this thing will cost. After reading this report I will post a new thread, but first I gotta leave town for a few days.
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[*] posted on 8-31-2007 at 09:28 AM


Pam,

"up to 1.5 million gallons per day of potable water. "

http://www.loretobay.com/loretobay/LBC%20Sustainability%20Ov...

page 5
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[*] posted on 9-4-2007 at 02:05 PM


Pretty amazing set of statements from Wilderone who apparently doesn't believe in checking facts before stating something is a fact.

Anyone with a brain knows there is a short term nightly rental market as the Inn at Loreto Bay attests to. Loreto Bay Co. has had a group of experienced resort managers and marketers working on a nightly rental program for some time and a very limited nightly home rental program is already operating. The main program has been announced to start next year.

I know for a fact that every home where a homeowner has requested a long term rental has been rented long term, most for one year. In fact, there is a waiting list of people trying to lease homes. I think there are more than 50 leased this way. So much for the lame lesson on economics.

About 50% of the homeowners are not interested in renting long or short term but want a second home to use for part of the year or for their family to use. They have chosen not to sign up for either rental program. Loreto Bay regular notes this.

Finally, the completely inaccurate quote "as you know, all amenities and common areas ...will need to be paid for by the HOA fees." Wrong. Minimal checking would have easily shown that golf, tennis, beach club and all other recreational amenities are not the responsibility of the HOA but are separately owned. HOA fees cannot be used to support these.

You left out a few other things as well like the majority of the first 500 homes sold were paid for in cash and are without mortgages, the HOA rules and the sales contracts have language that prevents quick flipping for profit and can you say Citigroup? This 50% partner is the worlds largest financial institution.

Next time get your facts straight before you sound off.
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[*] posted on 9-4-2007 at 04:35 PM


The Inn at Loreto Bay is a hotel. I was talking about nightly rentals of the village units, which was recently reported on the LB website, as minimum 4 month leases. Then if 50% of the homeowners want a second home, then HALF OF THE VILLAGE WILL BE EMTPY most of the time. The HOA will need to pay for plenty. BTW, how much are the dues now, what are the projected increases? Citigroup - HA! Their investment group providing the LOAN ("partner" - give me a break) - Citigroup Property Investors - "invests its clients' capital in private market real estate investment strategies designed ... to produce attractive absolute and risk-adjusted returns ...." So their clients are putting up the money and taking the investment risk. In fact, LB Villages was the FIRST such investment in their effort to invest in "sustainable" properties. AND CPI actually stated that they were relying on LB's sustainable hyperbole in offering the investment. CPI cautions their investors "loss of all or a substantial portion of the investment due to leveraging, short-selling or speculative practices; lac of liquidity; volatility of returns; absence of information regarding valuations and pricing; complex tax structures; less regulation and higher fees; advisor risk; general economic risks; environmental contamination; zoning requirements; development and renovation risks; etc. But their money's been spent so I guess if their investment fails, it's no skin off your nose.
If many of the recreational amenities are separately owned, then they'll be charging a fee for their services? How does that work? Golf fee, tennis fee, beach club (membership we know about), pay for towel, pay for drink, tip for drink, guests have a daily rate? Whole family in membership or per head? So it will cost what to spend a couple hours at the beach? What will happen if they're not making any money and decide to close up shop? Golf in the summer? Can't be too lucrative. Tennis fees? Haven't heard about this before.
Thanks for the information - Tell us more.
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"Let others lead small lives, but not you. Let others argue over small things, but not you. Let others cry over small hurts, but not you. Let others leave their future in someone else's hands, but not you." - Jim Rohn

 

"The best way to get the right answer on the internet is not to ask a question; it's to post the wrong answer." - Cunningham's Law







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