Omega, BBB JV to Develop Mexican Condos

Omega Commercial Finance Corp. and BBB Developments have formed a joint venture to develop the Los Corrales Condominiums in Puerto Peñasco, Mexico, on the shore of the Gulf of California. The project will have 308 units.Puerto Peñasco is toward the northern end of the Gulf of California (also known as the Sea of Cortez), and its proximity to Arizona makes it a popular destination for residents of that state. The town is expected to grow in coming years, following the development by Marriott Hotels of a four-star property not far from the Los Corales site, and the expansion of flights from major North American cities into the local airport beginning next year.Miami-based Omega, a commercial real estate finance company specializing in lending to middle-market borrowers, will be responsible for the $61 million construction costs and receive 45 percent of the net profit from the sales. BBB Developments acquired the property for $11.4 million, and previously had been self-funding the project from its own capital and groups of other investors.Currently, 108 of the units are pre-sold with contracts in place that represent $38 million in sales. Omega estimates generating a two-year annualized IRR of 25 percent, or $39.5 million in net profits, on the deal. Construction will begin this summer, according to the company.