Loreto Bay: Riding the Economic Wave

With the flurry of economic news about our fragile financial markets and the need for a $700 billion bailout by our government, it was of little surprise when Clint forwarded a letter to my Blackberry while I was in Milwaukee from TCC Loreto outlining some cashflow concerns of Loreto Bay.

For those of you that follow the handful of blogs that cover Loreto Bay, I’m a little late to this party. So where do I stand on this issue?

Firstly, Loreto Bay is planned to be a 6,000 home development spanning 10-15 years to build. Our economy runs in approximately 7 year cycles. So it is inevitable that we would hit a time of economic hardship. In the long run, Clint and I still think that Loreto Bay is a solid investment and when we purchased a home there, we knew we were in it for the long haul.

Even in these economic times, JW Marriott has started development on the Whales Inn. The Villa Group just announced it began construction on Villa del Palmar Loreto. From their press release:

Villa del Palmar Loreto will feature 161 one-, two-, and three-bedroom villas, all with views of the Sea of Cortez and the five islands. The first phase is slated to open in January 2010, with a complete investment of $60,000,000.00. Each villa will be decorated with elegant furniture and will include a living room, dining room, full kitchen with granite countertops, modern appliances and electronic equipment, and a 10’ wide spacious terrace in each Villa.

Alaska Airlines has reaffirmed its commitment to Loreto by adding more flights to the destination starting in November.

I think it is important to appreciate the context of these financial hardships and realize that like the recent pull-out of airlines from Loreto Bay this is more a reflection of the economic times rather than a reflection of the desirability of Loreto Bay. The economy will bounce back again, the critical thing is to ensure Loreto Bay survives until the next upswing.

Secondly, although a letter from Re:play will be useful, I think for those of us that are homeowners, it may be a good idea to jumpstart the homeowners association/Condo regime. Even if it is informally, in order to collect and record information that would be critical to the operation of the community should Replay ever pull out. I think it would be prudent to do this as a contingency measure. I think social networks such as the San Francisco Loreto Bay Yahoo group, www.myloretobay.com and loretobay.ning.com have gone a long way to ensure there is ample community communication and support. I think it has also added to the uniqueness of this development and that is priceless.

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  • David Sabet

    <p>Loni,</p> <p>What are Re:play's current concerns/problems?</p> <p>David</p>

  • David Sabet

    <p>Loni,</p> <p>What are Re:play's current concerns/problems?</p> <p>David</p>

  • David Sabet

    Loni,

    What are Re:play’s current concerns/problems?

    David

  • David Sabet

    Loni,

    What are Re:play’s current concerns/problems?

    David

  • Loni Kao Stark

    <p>Hi David – </p> <p>The concerns referenced in this entry were based on a letter some Loreto Bay homeowners got from TCC Loreto, a trusted third-party adviser to many of us that are trying to keep an eye on our home construction remotely. </p> <p>The main issues are around cash flow, financing of the project and Replay's commitment to the project. Not unusal concerns to be having in the economic times we are facing right now in the credit markets. </p> <p>Today, homeowners finally got a letter from Replay which reaffirmed their commitment to the project and explained how they are managing the slow down in cash flow by matching construction progress to cash flow in. </p> <p>Clint and I will be down late October and will report on progress and situation first hand. </p> <p>The investment of at least two other major resort companies even in this harsh climate is testament to the long term desirability of this area in my opinion.</p> <p>Loni</p>

  • Loni Kao Stark

    <p>Hi David – </p> <p>The concerns referenced in this entry were based on a letter some Loreto Bay homeowners got from TCC Loreto, a trusted third-party adviser to many of us that are trying to keep an eye on our home construction remotely. </p> <p>The main issues are around cash flow, financing of the project and Replay's commitment to the project. Not unusal concerns to be having in the economic times we are facing right now in the credit markets. </p> <p>Today, homeowners finally got a letter from Replay which reaffirmed their commitment to the project and explained how they are managing the slow down in cash flow by matching construction progress to cash flow in. </p> <p>Clint and I will be down late October and will report on progress and situation first hand. </p> <p>The investment of at least two other major resort companies even in this harsh climate is testament to the long term desirability of this area in my opinion.</p> <p>Loni</p>

  • Loni Kao Stark

    Hi David –

    The concerns referenced in this entry were based on a letter some Loreto Bay homeowners got from TCC Loreto, a trusted third-party adviser to many of us that are trying to keep an eye on our home construction remotely.

    The main issues are around cash flow, financing of the project and Replay’s commitment to the project. Not unusal concerns to be having in the economic times we are facing right now in the credit markets.

    Today, homeowners finally got a letter from Replay which reaffirmed their commitment to the project and explained how they are managing the slow down in cash flow by matching construction progress to cash flow in.

    Clint and I will be down late October and will report on progress and situation first hand.

    The investment of at least two other major resort companies even in this harsh climate is testament to the long term desirability of this area in my opinion.

    Loni

  • Loni Kao Stark

    Hi David –

    The concerns referenced in this entry were based on a letter some Loreto Bay homeowners got from TCC Loreto, a trusted third-party adviser to many of us that are trying to keep an eye on our home construction remotely.

    The main issues are around cash flow, financing of the project and Replay’s commitment to the project. Not unusal concerns to be having in the economic times we are facing right now in the credit markets.

    Today, homeowners finally got a letter from Replay which reaffirmed their commitment to the project and explained how they are managing the slow down in cash flow by matching construction progress to cash flow in.

    Clint and I will be down late October and will report on progress and situation first hand.

    The investment of at least two other major resort companies even in this harsh climate is testament to the long term desirability of this area in my opinion.

    Loni