One advantage for nearly any wealthy Mexican citizen that has owned property in the United States for any substantial period of time is that the peso has been in a long-term decline against the US dollar. In addition, the dollar is currently experiencing historically record strength against the peso.
Two companies run by Alfredo Chedraui Obeso have owned a Vail condo, Unit 110 at Village Inn Plaza, in Vail, CO for which the valuation converted into pesos has soared since purchase, which you can read more about in our earlier coverage.
In March 1984, Unit 110 in Vail was first purchased by a company later shown connected to the Chedraui family. At the end of that month, one US dollar was worth the equivalent of 0.1662 in today’s pesos. (In 1993, the peso was revalued from 1,000 old pesos to 1 new peso.)
As of February 24, 2017, one US dollar was worth 19.8690 pesos. The dollar had gained by a factor of 119 on the peso in the nearly 33 years since the condo was first purchased.
Over the same period of time, the property increased in US dollar value from $620,000 (the purchase price) to an estimated market value of $2,380,570 (from Eagle County). This was an increase by a factor of 3.8.
In pesos, the property was purchased for 103,044 pesos (at 0.1662 pesos to the dollar) and had an estimated value of about 47.2 million pesos (at 19.8690 pesos to the dollar as of February 24, 2017), an increase by a factor of 459.
If the peso were still at the rate it was in 1984 when the condo was purchased, the condo’s peso value would be about 396,000 pesos. About 46 million pesos in value were created by the collapse of the peso against the US dollar over the past 33 years.
This shows the value to Mexican elites in holding United States real estate, regardless of whether the property is ever converted back into pesos. The companies in this example are based in the Cayman Islands and transferred the condo between them in 1997 for $726,900. Any actual profit in pesos would depend on the future sale price, the future exchange rate, and how the ownership of the condo has been structured since purchase.