Windermere Real Estate is setting up shop south of the border, a move that will go a long way toward easing buyers’ fears about safety in Mexico’s popular resort areas.
Geoff Wood, CEO of Seattle-based Windermere Real Estate, the largest real estate company in the western United States with more than 300 offices and 7,000 agents in nine states, said that the company will open its first international franchise office in Mexico.
Located in Cabo San Lucas, the Windermere Los Cabos office will open in September and represents the merger of CaboRealty Partners and Nieman + Posch Boutique Realtors, two established firms that have operated independently in the Cabo area.
The announcement marks the first move by a major U.S. real estate chain into Mexico since the downturn in the U.S. economy and the border-based violence fueled by Mexican drug cartels.
Jay West and Martin Posch are the principal owners of Windermere Los Cabos. West, who lives part time in Longview, Wash., and is a University of Oregon graduate, has been a key link south of the border for the National Association of Realtors and its sister organization, the Asociación Mexicana de Profesionales Inmobiliarios (AMPI), since moving to Cabo in 1994.
Originally from Switzerland, Posch moved to Mexico in 1998 and was a sales manager with Prudential California Realty in Cabo San Lucas. In 2011, he opened his own real estate company, and, earlier this year, formed a partnership with West in order to open the Windermere Los Cabos office.
Wood said his initial discussions with West about the Mexico possibilities began in 2005.
"We knew Jay was the right guy, but it wasn’t quite the right time," Wood said. "We simply didn’t have the infrastructure in place to support an office in Mexico at that time. Fast forward seven years, and we now have 300-plus offices in nine western U.S. states, most of which have a natural migration of residents to Mexico. Add to this the 79 million baby boomers who will reach retirement age over the next 18 years and studies show that many of them will purchase a second home in resort areas such as Mexico."
And the studies also show that a majority of boomers have not saved for retirement and will need to spend fewer dollars in their future years. According to a report by Washington, D.C.-based Center for Economic and Policy Research (CEPR), baby boomers have not saved and they will be forced to work longer and/or move to less expensive places than they anticipated. Property taxes, health care and cost-of-living increases will force boomers to consider moving to other countries, especially if they plan on living at the same level of comfort as they do now.
While the negativity surrounding the country peaked at a time when more and more Americans could have used a less expensive place to live, the Windermere decision could ease the fear factor because of the clientele and geographical areas it represents. The company tends to attract sophisticated, upper-end buyers who have done research on their targeted area.
According to Wood, despite what Americans may have heard, read and seen, the country is not under siege. News reports — including a segment on "60 Minutes" — have depicted the entire country of Mexico as being an absolute mess, awash in blood and guns on every street corner. Ironically, people living there have a dramatically different perspective, especially in the "fly-in" destinations that continue to hold their value.
"The media has done a great job of playing up the fear factor in Mexico," Wood said. "But there are those who own property and do business in the area that are gradually dispelling those stories. Like any country, there are unsafe areas, but our experience is that Los Cabos is very safe and offers great real estate opportunities for both U.S. and Mexican homebuyers."
West said North Americans living in Mexico have retained the "mañana"attitude (laid-back with no sense of urgency) even when it comes to crime.
"They realize it’s basically a border war among drug gangs," West said. "Travelers to resort destinations like Los Cabos, simply do not experience the kind of crime and violence that is common in most major cities throughout the U.S."
Both sides in the Windermere Mexico franchise deal say they eye further expansion but will use Cabo as the first test. Brokers in other areas say they will welcome the move because Windermere’s presence will generate activity slowed by the economy and crime reports.
"Having worked as a broker with Windermere in Washington, I am very excited for them to expand to Mexico," said Jim Donahoe broker/manager for Linda Neil Properties in La Paz and a University of Washington graduate from Aberdeen, Wash. "The company’s professionalism together with its market reach along the western U.S. will create a tremendous market opportunity in Cabo and Baja Sur."