Both local newspapers carried a story today about the ongoing legal battle that puts the Puerto Vallarta Hotel & Motel Association against the developer of the Grand Venetian and the past Vallarta mayor Gustavo Gonzalez. The association claims that the property on which GV is built was not zoned for condominiums but for hotels and that the permit was illegally given by the past mayor. This week their case, in its first reading, was won by the association.
For those not aware of the Grand Venetian, this is a very large condominium development situated on the beach in what’s called the “Hotel Zone”, which stretches from the cruise ship docks to downtown Vallarta. It is located about halfway between downtown and the marina area. It has been controversial not only because of the zoning, but also because of its height at 24 floors. It established a precedent so there are now three other major condo developments in the region – Peninsula, Icon Vallarta and Tres Mares – all over 20 floors in height.
What’s this mean for the mayor and the developer? Well, it will most definitely be appealed, which can take place three times in Mexico – and this is just the first instance. A work stoppage order will most likely be issued, but the developer will come back with what’s called an “amparo”, that would allow him to continue building the project out while this case is in court.
But it doesn’t look good for Gonzalez. He issued this permit.
With regards to GV, that could prove very interesting. Not only is GV mostly built, it is mostly sold out to many individual condominium owners. Where does this put him if he has a permit from the municipality that says he can build condominiums here and to this height. Who is at fault here?
Perhaps they could settle this by turning GV into a “condo-hotel”, like the hotels found at many ski resort destinations. The developer hires a hotel operator, the owners of the condominiums would get a return on their investment by receiving a portion of the proceeds from the operation, and would also get a certain amount of time to use their condominium. For many, that could be a better deal than trying to rent it on their own. This would be fine if they bought it with the intention of renting it out, but if it was to live there full-time, that would be a problem. I would think though, that many, considering this size of the project, would be interested in renting, or a condo-hotel type operation. At least that’s one option. Going to be very interesting to see how this plays out.