Pretty much everyone has heard of Cabo. La Paz has been an expat hot spot for quite some time now. But what do you know about Loreto, a tranquil fishing town with a population of about 15,000, about 220 miles north of La Paz? I traveled to Loreto recently to review the Villa Del Palmar hotel for Luxury Latin America and to know the adventure tourism in the area – what I did not expect going in was to land in a place that suits the needs of so many people I know who want to move to Mexico and who want to find an authentic, still relatively affordable place that is safe and relaxed.
Thirty years ago, FONATUR, Mexico’s tourism development agency, identified Loreto as having the natural beauty to become a world-class tourist destination. (Other FONATUR picks at that time included Los Cabos, Cancún, and Ixtapa/Zihuatanejo.) Unlike the other areas, Loreto has never become a mega-resort monstrosity. Instead, it has remained a friendly little town that welcomes a relatively small group of in-the-know tourists and expats.
With a history dating back to 1697, Loreto is considered to be the oldest human settlement on the peninsula of Baja California, Mexico. While eco-tourism has evolved in the Loreto area, much still remains the same as it did when the area was first settled, including cave paintings that you can find, and a Jesuit mission deep in the nearby mountains. An inclusion in 2012 as one of Mexico’s “magical towns” ensures that Loreto will thankfully not be able to develop itself into the next Cabo.
But while Loreto is protected and still small (population of about 15,000, with more coming in during the high season), its days completely off the radar may be numbered. Recently, the Mexican government has been investing in Loreto. Thanks to FONATUR, Loreto has received more than $200 million in infrastructure improvements, includinga large new terminal for its international airport.(Alaska and Delta Airlines offer nonstop service from LAX and Continental Airlines offers nonstop service from Houston). FONATUR also built a marina, two hotels and a golf course, and put in roads, water, sewer, utilities and water/sewer treatment plants, Grogan said. A state-of-the-art hospital is in progress.
Let’s get something straight. Loreto is not for everyone. If you want glitz and glamour, look elsewhere. Loreto is a wonderful,relaxed place for those who love all kinds of outdoor activities like hiking, diving and snorkeling.
The town of Loreto is blessed with being surrounded by gorgeous natural beauty. Behind the city are the Sierra de la Gigantamountains and it’s coastline offers beautiful sunrises over calm turquoise waters of the Sea of Cortez. What makes Loreto special is it’s marine park, one of the most biodiverse bodies of water in the world, and a place that Jacques Cousteau himself called “The World’s Aquarium”. I have snorkeled all over the world, and I had one of the best snorkeling days of my life around Coronado Island in Loreto. Loreto is also a breading and birthing location for gray whales, and there are turtle preserves. The five islands off Loreto are part of a World Heritage-protected marine park that covers nearly 1,300 square miles.
Loreto has a reputation as an excellent sport fishing location. This is its main tourist attraction, as well as the main source of employment in the area. There are two well-defined fishing seasons: summer features dorado and species like marlin (black marlin, Atlantic blue marlin, striped marlin) and sailfish, which are ideal for the fly fishing; winter fishing features “yellow tail” (jurel) and other species that usually are deep in the sea rocks. In addition to these seasonal species, Loreto’s waters are home to other species like snapper and seabass, which are found all year long.
For all the spectacular beauty around it, Loreto in many ways remains a typical, small Baja town. Only two main roads come into town, and both dead-end at the sea. Many of the side streets, especially in the residential area near the water, are simply packed sand. And if you ask directions, you’ll always get a friendly answer.
It may even be in English. Loreto has become used to tourism, especially from the west coasts of the U.S. and Canada. Most locals can manage a little English, and there are perhaps 400 full-time expats here, up to 1,500 (about 10% of the population) in high season.
What caused many of those expats to choose Loreto? “Baja is geographically the Florida of the West Coast,” Jim Grogan, president and CEO of Loreto Bay Company (a planned community in the area), said. “If you can imagine an opportunity…to purchase and develop seaside resorts in Florida 100 years ago, that’s the opportunity that exists in Baja.”
“There’s really no affordable beachfront left in southern California, and everybody’s hungry for their place in the sun,” Alan Axelrod, Baja investor and managing member of Axelrod Capital Management, LLC, said.
Loreto is unique among FONATUR’s projects in that FONATUR is working with Loreto Bay Company on “a different plan of development…low rise, no hotels blocking the beach, pedestrian friendly, villages with no cars…working with these sustainability principles which it had never really paid much attention to before,” Axelrod said.
“There’s a sustainable way of developing where you can literally improve the environment, and improve the quality of air and water, and add more biodiversity, more biomass,” Grogan said.
The Loreto Bay Company’s development is not the cheapest place in the area, Axelrod said. Even so, its prices are “a third the cost of a similarly situated project in Cabo, and…a sixth to an eighth of the price of southern California,” Grogan said.
Relaxed zoning requirements make it easy to do thoughtless development in Baja, and the challenge is to have American investors come in and both make money and keep Baja sustainable and livable, Axelrod said.
Home prices in Loreto range from $130,000 USD to $865,000 USD, while land costs run from $40 per square meter near the highway to $200 per square meter on the water. Construction costs average about $75 to $80 per square foot for new home construction, and costs are a little higher for remodeling an existing structure.
Demand for properties in Loreto is likely to increase as high prices in Los Cabos and on the U.S. side of the border cause would-be vacationers, retirees and second-home buyers to seek more affordable markets. For investors, tourist services, such as bars, restaurants, water sports and ecotourism, are another area of opportunity, and affordable housing for service providers is yet another, Axelrod said. “It takes a lot of people to service the tourist industry, and they have to have a place to live.”
Realize that in a still somewhat sleepy town such as Loreto, the MLS certainly does not hold all of the housing listings. Some of the best finds in real estate will happen from talking to the locals, or taking a few days to drive around the area looking for signs in yards.
If a location close to the US (but seemingly worlds away with its slow, relaxed pace of life) sounds good to you, you should definitely put Loreto on your list of places to check out.