After analyzing figures provided by the Mexican government, Concord Marketing Group reports Americans bought 2,500 homes or lots along the Baja California peninsula last year. Orange County-based Concord also expects those numbers to be topped in 2006. No real surprise there.

What is surprising is the market is taking an upward swing, attracting affluent U.S. buyers along both the Pacific Coast (Tijuana-Ensenada) as well as the Sea of Cortes from San Felipe to points south. For the last 10 years, those buyers of $1 million-plus homes have focused primarily on Los Cabos, which is located in the state of Baja California Sur, not in Baja California (Norte). This is about to change.

While bargains will still be found along the Tijuana-Ensenada coast, some major developers are preparing to target the high to very high economic end demand.

These very high-end destination resorts on the drawing boards combine the grand opulence found in multimillion-dollar homes with a host of luxury-level amenities and services, such as tennis, spas, gourmet restaurants and boutique shops.

Another trend to watch for in this ultra-rich market is “fractioning,” not to be confused with time-share (interval-ownership). Fractioning is the actual fee interest as tenants in common ownership typical of a condominium or townhouse within a separate section of the development.

Many such developments are scattered throughout the world. But the first along the Baja coast will be Porto Hussong. Scheduled to break ground by early November, the property is just north of the port of Ensenada, offering spectacular ocean views.

Since it is new locally, the concept raises questions. Why would a wealthy family buy a “fraction” of a condo in a posh resort when such a family can buy outright? The reason is the wealthy like to travel and spend a little time here and a little time there, but always in style and with pampering privileges.

Buying a fraction in the right development earns access to a multitude of other similar posh developments as the best ones belong to a network of other five-star quality resorts.

Porto Hussong is offering a five-week fractional ownership in its “The Meridian Club.” Those weeks can be exchanged, in all or part, for time at comparable resorts that belong to the network. Prices have not been finalized, but likely will range from about $400,000 to $3 million, with the upper price for a spectacular penthouse.

An added incentive for considering Porto Hussong’s Meridian Club membership is access to a 74-foot Viking yacht. And what the developers consider the pièce de résistance is a state-of-the-art megayacht marina capable of mooring vessels up to 200 feet in length.

The 14-acre Porto Hussong development is important to the entire Baja California region. Its success will raise the bar for other developers and in turn provide new economic and employment resources in Baja plus the inevitable spillover into San Diego’s retail, wholesale product sales and services industries.

To succeed, Porto Hussong will depend in great part on the quality and experience of its development team. Also, because the project is in Mexico, potential buyers will be watching how smoothly the developers assure clear title to buyers and comply with fiduciary obligations in handling presale deposits and delivery of the product as represented.

Potential buyers should judge a purchase on many things, but these three steps are mandatory. If the developer fails to offer title insurance, don’t buy. If the developer requires a pre-construction deposit that is to be used for construction financing, but does not offer a completion bond to protect buyer’s deposits, don’t buy. If a developer claims deposits are refundable, but does not deposit escrow funds with an acceptable third party entity with fiduciary obligation, don’t buy.

Porto Hussong meets those standards and more. It offers mortgage financing through GE Financial of Mexico, a careful lender that will assure itself of construction quality before lending.

But how about the developer and its team? Here again, Porto Hussong meets the standard. It begins with the Hussong family as landowners. Theirs is a high profile name as Cantina Hussong’s has been the favorite Baja watering hole for generations of Americans from Southern California and points far beyond. The Hussongs are interwoven into the fabric of Ensenada with splendid reputations in business and community leadership.

The developer the Hussong family chose to partner with is the Meridian Development Group based in Reno, Nev. I met with director Chris Merson, a 35-plus-year veteran of real estate development in Mexico, to discuss his past activities in Mexico and Porto Hussong.

Porto Hussong has chosen Diane Gibbs’ Realty Executives as its exclusive selling agent. Gibbs enjoys a high level of confidence and reputation in the real estate brokerage community on the Baja coast. She too vouches for Merson and his team.

So Porto Hussong meets the standard for a good seal of approval. It is not alone, of course, as Baja’s real estate market moves into this luxury phase. So look for more discussion on this topic in future columns.

Patrick Osio Jr. can be reached at posiojr@sandiegometro.com. The veteran consultant also has issued The Mexican Perspective, an intensive primer on business culture and protocol. Copies are available at http://www.hispanicvista.com/sales/book_sale.htm.