Search Baja California

Thursday, February 1, 2007

Bruce Parkman - The Man Behind Playa de Oro

BRUCE: For me, it goes back to 1988 and the National Penn Company and El Dorado Ranch, I had one of these deeds of license, and I came down here to find out what it was. At the time, the national Penn Company still owned El Dorado. They were just starting their program, they didn’t have their pool built, and they were just talking about what they were doing.

MEXICO LIVING: When did Playa de Oro become a reality after that?

BRUCE: All my life I’ve been involved in real estate; buying, selling and developing। So real estate has always had an interest for me and as I looked around San Felipe, you could not buy as a non-national at that time; it was limited as to what you could own. Then in December of 1993, the Mexican government changed he law so that non-nationals could own Mexican corporation and real estate through the Fideicomiso (bank trust) process. In January 1994 I formed the first Mexican corporation owned by non-nations in the San Felipe area and opened a real estate company. We ran the real estate company until 1999. During our first year; 1994 and 1995, we had a huge demand for property, but there was no property. There was such a limited inventory of safe and secure property that you could buy.

MEXICO LIVING: Who own the property at the time?

BRUCE: Most of the property was own by Mexican national [Ejido], and we would lease it from them or it was large, large parcels। If someone wanted a small parcel, no one had a sub-division। El Dorado had their lots on the mountainside of the highway and at that time were a lease situation। Nevertheless, we had people that wanted to buy. The only thing we could sell in those days was the San Francisco development, the Hacienda development and some lots in town. So I thought if we had a good sub-division the American people would buy it if we could make it safe and secure for them.
This property of Playa de Oro came about as I was driving down the highway one day and there was a FOR SALE on the side of the highway and it was owned by Bancomer the Bank. So I’m thinking if Bancomer owns it, they had to repossess it from somebody and if they repossessed it, they had to cleanse the title. About a year later, I bought the property and all the predictions turned out true; the title was cleared and we started the sub-division process.

MEXICO LIVING: In addition to the first real estate brokerage in San Felipe, you became the first non-national landowner?

BRUCE: Yes, probably one of the first.

MEXICO LIVING: At that time was El Dorado still leasing their property?

BRUCE: Yes, they were still leasing at that time. I think Pat Butler took over in 1995 or 1996.

MEXICO LIVING: A couple years later?

BRUCE: Yes. That was about when Pat entered the picture, and when he entered the picture, he started working on getting the titles or the land; prior to that it was all leased.

MEXICO LIVING: You were pioneering and didn’t know it.

BRUCE: We found out something very interesting a couple of years ago. We had a man here from the real estate control department in Mexico City. We were talking to him as he was here looking at various properties and he had a map of all the lots on the north side of San Felipe. Playa de Oro was the only property that showed all the individual lots, all the others were just long narrow pieces of land. So I asked him why Play de Oro was the only to show all these lots and he said that Playa de Oro was well know in Mexico City, because it was the only development 100% owned by a non-national and is legally approved to transfer title to non-nationals – in all of Mexico.

MEXICO LIVING: Wow, you must have been feeling proud about that time.

BRUCE: Yes. So, then as we moved forward in the process and got our First American Title insurance, we were again the first development in all of Mexico to have title insurance on the entire project. There was title insurance, but it was a lot here, lot there, but not on the entire project. So that was a novel idea and as it turned out my initial intuitions were correct, the American people wanted exactly what we were offering.

MEXICO LIVING: I’ve seen many development signs up and down the highway for very long time, but only a few with light construction or no construction at beyond their entrance. However, you have many homes and as many as 10 different homes being built right now on this development alone. How do you account for that? What makes you different?

BRUCE: There are several things that make us a little different; one is we’re focused on a project and we put our sales money back into our project. What happens with other developers is the money goes somewhere else, or goes to buy more land or other items. In addition, many developers think you can shortcut. There are no shortcuts. They says things like “they know so and so” or “I’m connected here” or “I know the guy at the electric company”, “I know the Mayor,” and that and fifty pesos get you a cup of coffee [laughter].
For example, on the electricity; you see the power line running down the highway and you think you can just attach to the power line and you have power to your project. That is not that way. You have to have an engineered plan of your project, showing in detail what you’re going to use and how much KVA you’re going to use. How are all your wires laid out? How are your transformers laid out? Then all that has to be approved by the electric company, the county and the state before you can even go forward.
Once you’re approved for your electric, then you do your installation and go to the electric company and tell them you want to power your sub-division. At that point, the electric company has two charges; they have what they call a connection fee and are huge and then they have what I call “the privilege tax” which is even bigger [laughter].
For us to make the connection to the power line to our entire underground system costs us around $800,000 US. We have about two million in electrical including the underground, wiring etc. Then once it’s all in and it’s all done, we had to sign it all over the electric company. Other developers just don’t understand that.
What’s interesting is when you follow the law in Mexico things work. I have assembled a team of attorneys, engineers and architects; people I feel comfortable that I could work with. But you never know if they’re doing what you want them to do [laugher]. As it turns out, going back to the guy from Mexico City I mentioned earlier, obviously my attorneys, engineers and architects did everything correct because there was the proof [only development with map of individual lots].

MEXICO LIVING: Is this project completed?

BRUCE: No, we have about 18 lots left and about 20 lots we need to get electricity. Then we have to decide on some sort of surface for the street. The original intent was to put some sort of dust proofing sealant. Nothing oil-based or asphalt, because during the rains all the water and oils run down the arroyo and into the sea and we can’t have that. We’ve been very environmentally conscious here and want to protect Baja, so were looking at options.
We’re going to work with the homeowners association; there have been a few homeowners with ideas too. Plus we want to finish our entrance and security gate.

MEXICO LIVING: Yes, it looks like it’s going to be very nice. So what other projects do you have?

BRUCE: We have Playa San Rafael just a half mile north of Playa de Oro, which is very similar except we made the lots bigger. Seems people wanted bigger lots, so that’s what we’ve done, made bigger lots. That project is just in the final stages of recording all the final sub-division documents and once that’s done, we’ll start the development process. We have 330 plus lots over there and we’ve sold about 60 in the pre-sale deal.

The markets we’re looking at there are the US citizen that just wants a little place for the weekend or maybe stay for week or so। Give them a garage to keep their toys in, and keep the pricing below $150,000 for land and home.