The sun sets on Baja, but environmental efforts in Mexico continue to lead the world. (Comstock Complete)

LORETO BAY, Mexico -- Who would have thought, on such a bright hot Baja kind of day, that we would be happily snapping photos of a large homemade trash compactor for all the world as if we were the paparazzi and it was Angelina?

Sure, it's great to get enviably red on that first giddy day of a Mexican beach break but, for a moment, let's consider going green.

After all, that's why our small group of environmental and travel writers had been invited -- to check out a new eco-friendly real estate project, the Villages of Loreto Bay, stretching for 5 km halfway up the east coast of the Baja peninsula.

At the centre of this is the Inn at Loreto Bay, a secluded, low-key resort that opened in 2002 as the Camino Real. It offers simple yet splendid views. Backdropped by the Sierra de la Giganta Mountains, the Inn looks out on the Sea of Cortez. A soft-sand beach dotted with palapas is a step away from the Inn's comfortable 155 rooms and suites. The picture-perfect desert and water views are framed by massive windows, cut out in thick walls painted warm shades of white, coral and yellow.

Recently, this beautiful vision got a little bigger.

The Inn was bought in 2005 by the Loreto Bay Company and is a key part of the ongoing project of The Trust For Sustainable Development, a Canadian corporation. The Trust had been approached by Mexico's National Tourism Development Foundation (FONATUR) to develop the area in a sustainable way. Experts in eco-living quickly signed on, and, under the mandate of "live fully, tread lightly," great care has been taken with all aspects of energy and water conservation, habitat protection and prevention of air pollution.

Hence, the trash compactor. When those in charge of sustainability saw that the cardboard, plastic and Styrofoam packing materials for the Villages' decor items was headed for a garbage dump, they took action. From this recycling example to the paint chosen to the adobe earth blocks to the air-conditioning and heating, ecologically satisfying solutions have been found.

The Villages of Loreto Bay will undoubtedly be stunning. The 6,000 dwellings of colonial Mexican design are arranged in groups, nine in all, to create a community feeling -- a concept integral to this "radically different" project directed by David Butterfield, the Trust's founder.

The one-, two- and three-bedroom upscale courtyard homes we toured in Founders Neighbourhood, phase one of the endeavour, are outside-in in a way. The interior has a jewel of a small garden, with a burbling fountain and lounge area open to the fresh air and stars. Instead of a front porch, there is a rooftop terrace where homeowners can socialize with their closest neighbours and, from this raised vantage point, feast their eyes on the mountain range and the sea.

Phase two, expected to sell out by the end of 2008, is called Agua Viva or Living Water and will have regenerated estuaries running through it that homeowners can access with canoes and kayaks.

Seeing is believing. Some of us wanted to move in right away.

But could we? Of course -- if we had between $500,000 and $600,000 (average price) for a holiday home in Mexico. Many folks obviously do. More than 800 homes have been bought so far. Eventually, all will be able to enjoy health-oriented activities including spas, an 18-hole championship golf course, a beach and racquet club, and a natural preserve where one can hike, birdwatch or go horseback riding and cycling. And, because the Villages will be auto-free, small stores and bistros will be within walking range.

This vibrant seaside village is expected to be completed in a dozen years, and many homeowners have already moved in.

A rental program has just begun at the Villages and allows visitors the chance to stay at one of the beautifully furnished single family homes. A few two-bedroom homes are available from about $300 per night and $1,800 per week. Renters are also welcome to use the Inn's facilities.

Whether you purchase or rent a home in the Villages, or spend a week relaxing at the Inn, do explore the town of Loreto, a short cab ride away.

Once the capital of the Californias, this fishing port is still unspoiled. Cobblestone streets shaded by arched trees lead to the Mission of Nuestra Senora de Loreto and around the quaint town centre there are souvenir shops, a funky hotel called Posada de la Flores, and surprisingly good restaurants.

Don't miss Mita Gourmet. We dined outside one evening, downing glasses of sangria and munching on pollo con mole (chicken with mole sauce), taquitos de pescado (fish tacos) and, of course, guacamole, while a guitarist entertained us.

The port is just a few minutes away, off a majestic road lined with tall palm trees. We had breakfast at St. Lucia, where freshly squeezed orange juice, egg dishes and yummy breads were mouth-wateringly good.

Take a boat trip to Parque Nacional Bahia de Loreto (Loreto Bay National Park), a marine park comprised of several islands including Coronado.

Going to the beach one afternoon, we saw magnificent sea lions sunning themselves on rocks, and a pod of dolphins swam swiftly over to greet us. If you're as lucky as we were, these playful creatures will steal your heart as they leap in the air. For snork-ellers, the salt waters, teeming with fish -- and humpback and grey whales (at specific times of the year) -- are a dream come true -- as they were to Jacques Cousteau, who dubbed the Sea of Cortez the "world's aquarium."

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More Information

Visit the website at loretobay.com, e-mail info@loretobay.com or call 1-866-956-7386 (1-86-MY LORETO). Visit the Inn's website at innatloretobay.com, e-mail reservations@ innatloretobay.com or call 1-877-865-6738 (1-877-TOLORETO). Continental, Alaska and Delta airlines all fly to Loreto.