29 August 2010
The perils of investing in paradise
A road sign points the way to Tenacatita Bay in Jalisco state, where a titling dispute jeopardizes the investments of at least 40 foreign property owners. The owners bought deeds over the past five years that had been issued by the federal government and validated by the president of Mexico. But a Guadalajara-area businessman recently won a court injunction saying his company holds a valid deed to the same area - which was purchased in 1991 from the widow of a former Jalisco state governor and upheld in 1977 by the Mexican Supreme Court.
State police now block access to the land the foreigners purchased along with the beach at Tenacatita, which had been popular with working-class Mexican sunseekers. The businessman, Andrés Villalobos, told reporters last week he would not offer the foreigners any compensation since, he said, they were most likely deceived in making their purchases. He promised, however, to help prosecute anyone tricking them into purchasing land that he said was always private property and not for the federal government to title and sell.
The foreign buyers insist they did their due diligence and hold titles validated by one of either President Felipe Calderón or former president Vicente Fox. At least one buyer put her title into a bank trust, suggesting her purchase was considered proper by some institutions.
I recently travelled to the Jalisco coast to write on the issue for Postmedia News. Click here to read it.