I was fortunate to spend some time this week with Jim Spano, the managing partner of Spano Partners Holdings and the Chairman of the recently formed Loreto Visitors Bureau. One of his company’s real estate projects is the JW Marriott Residences Loreto.
Like a lot of us involved in the region, Jim is optimistic about the prospects about Loreto in the long-term, with a healthy dash of caution in light of the current economy.
Over the course of our discussion we covered the newly formed Loreto Visitors Bureau and its mandate, the JW Marriott development, the partnership with Alaska Airlines, and his take on the prospects for Loreto.
The Loreto Visitors Bureau
Late last year Jim and others took a leadership position in their efforts to pull together as many political, financial and industry resources through a consortium, including competitors, to help “level the playing field” in getting Loreto increased visibility.
To accomplish this goal, the Loreto Visitors Bureau was created. Jim is the Chairman and the organization meets every few days.
A recent promotion organized by the group involved Alaska Airlines. The second promotion “Twice as Nice at Half the Price” was announced this week (see press release “Loreto, Baja Sur, Mexico: Twice as Nice at Half the Price” here) with aggressive price incentives that helps would-be visitors extend their vacation dollar. Information on participating restaurants is forthcoming and will be announced by a major media outlet.
So far so good.
The initial efforts of the organization have resulted in more effective communication among key stakeholders. Jim told me the president of the hotel association also sits in on the group, and represents in the neighborhood of 60% of business in the Loreto region.
When Jim and I discussed the mandate, he succinctly boiled it down to 3 key priorities:
- Airlines. Ensure adequate airlift is available, and that seats are filled. More on this below.
- Exposure. Investments in the image and visibility of Loreto Baja needs to continue, even more so in a challenging economic environment. Jim was pleased that “4 mega resorts could work well together”. It’s a make or break period, and it’s to the benefit of all the players involved: JW Marriott, Loreto Bay, The Villa Group, La Mision and all the ancilliary businesses that go along with it.
- Organization. The well documented previous efforts to turn Loreto into a tourist documentation were agonizingly slow and unsuccessful, even with some FONATUR backing. However, acccording to Jim this new approach will hopefully catalyze a team approach, with shared goals.
The JW Marriott Residences Loreto Development
As most of our readers know, JW Marriott has opened a “stunning” sales center, with something approaching $1M already invested. We’re very pleased to see a prestigious, 5-star marque enter the Loreto market. That’s not to say it will be easy. It’s too early to tell how well the 200 units will sell, but the buzz is building.
I asked Jim about the challenge of selling luxury vacation real estate in this downturn.
90 days ago if you asked me, I’d say that it’s all about location, location, location. Today, it’s all about value proposition, value proposition, value proposition – Jim Spano, Spano Partners
He contrasted the Cabo market with Loreto, and suggested well healed buyers were also cutting back, but could maintain an equivalent vacation lifestyle since the JWM product was priced 40-50% less than something in Cabo. “People who have the means still need to cut back a little. They want to spend less while maintaining a luxury standard of living.” Further, he added, buyers get the Ritz standard of excellence, noting the Griffin logo is used on their promotions.
I think he put it best when he said, “90 days ago if you asked me, I’d say that it’s all about location, location, location. Today, it’s all about value proposition, value proposition, value proposition.”
When the JWM Loreto web site was launched “it was clobbered” earlier this year. The first official sales event takes place next month.
The Alaska Airlines Partnership
Airlift to Loreto has been a hot topic, on this site, across forums and user groups across the Web. The reason? Loreto needs sufficient flights to support growth. But it’s yin and yang. If you offer seats will they come?
Last year, the airline industry (along with just about everyone else) was constantly rocked by bad news. First it was gas. Then it was the economy. Add in an already sky weary public, and it was a recipe for disaster. Continental and Delta, among others, took it on the chin. Hence Loreto was clearly a cutback candidate.
With the reduced capacity, though, Alaska flights to Loreto fill up fast. So much so, that it’s sometimes difficult for homeowners, prospects and Loreto lovers to get down when they want.
This is the never ending challenge of building critical mass.
Fortunately Alaska Airlines is a strong partner and helped establish the success of Cabo San Lucas in the early days. Recently Jim and some partners flew to Seattle to keep the partnership and goals on track. Some marketing efforts have already been put in place, with others planned. We didn’t get into specifics, but I think Spano Partners and the Loreto Visitors Bureau is on the right track here. Time will tell, and I know all of us are anxious for a positive outcome.
The Future of Loreto Baja
While no one has a crystal ball, you can mark down Jim Spano as another Loreto supporter. It’s no surprise given his economic interest. But then again there are many investment opportunities across the world, and yet he chose Loreto as his first international project.
In his estimation Loreto offers a unique experience, different from the big, established neighbors to the South such as Cabo San Lucas and La Paz. The proximity to the sea, the beautiful vistas, and, perhaps, most importantly, the price points offer vacation buyers a special opportunity.