"Roofs had collapsed, vegetation had grown wild, and thousands of birds, bats, and possums had established several generations of nests," says a Montreal designer describing a dilapidated house she and her husband, an investment banker, happened upon while visiting friends in Mérida, on Mexico’s Yucatán Peninsula. "We simply fell in love with the culture, the people, the city. . . and the ruin."

The couple bought the property and through word-of-mouth found an architect, Javier Herrera, who was well-versed in the vernacular of Mérida, having renovated several other homes there. "When I first saw the house, I thought of what it must have been like in its heyday, its golden moment, and how we could recover that," says Herrera. "A renovation like this is always challenging because you have to expand the limits of the house yet retain its character. We had to change the house’s functionality to accommodate modern needs."

Such intriguing ruins are not uncommon in Mérida: Settled by Spanish conquistadores in 1542 upon Mayan lands, the city enjoyed decades of prosperity in the late 19th and early 20th centuries with the export of henequén, or sisal. The concentration of wealth allowed businesspeople to build elaborate palaces decorated with treasures imported from Europe, and the area remained overrun with affluent exporters until the henequén business dried up due to the introduction of synthetic materials. Through boom and bust, residents have maintained a penchant for celebration, exemplified in the large centro historico, in which this house sits. "The theater, the cathedral, and the main plaza are all within a two-block radius," says the homeowner. "Every weekend, they close off the main arteries to traffic, and there’s live music and dancing. Little old grandmothers in their Sunday best dance the tango and paso doble with their husbands into the night."

Since the footprint of the 150-year-old Spanish colonial wreck was beyond a simple tabula rasa, the new home could be configured to the owners’ every whim: In addition to a new grand sala, the house received a den for the husband, a formal dining room that comfortably seats 20, a new pool, a wine cellar, and bedrooms for each of the couple’s grown daughters. "One of my daughters is a medical doctor, and for her we made a very clinical white room with a shell motif," says the owner, who designed the interior spaces. "And my other daughter is pursuing her doctorate in literature, so we made her a very moody red room, complete with a hidden staircase that leads to a reading nook on a mezzanine with floor-to-ceiling bookshelves." The adjoining white room, she points out, is loosely modeled after Botticelli’s Venus, and includes "an en suite bathroom with a tub worthy of Cleopatra—one she can literally swim in."

Five additional bedrooms were built into the home, with the master suite receiving the grandest treatment of all: a roman bath and a 30-foot waterfall. The husband’s only wish was a den of his own for after-dinner drinks and cigars, a request his wife fulfilled with a hand-carved stone space with impossibly high ceilings, executed in a deep red with white accents, and brown leather furnishings. "He’s happy with it," she exalts.

The owner and the architect took much inspiration from the existing arches, colonnades, and courtyard on the main level. "They were in very sorry shape, but we could still see what they had been and what they could be," says the owner. "Most of these houses were built around a central courtyard—the heart of the home—and we strove to retain that." In another nod to local history, the architect referenced Chichén Itzá, about an hour by car from the home, for the stone fountain just inside the entrance. "The decoration is a copy of a resurrection scene at the archaeological site," says the owner. "It reminds us that this house has been resurrected." In all, the restoration took just over a year to complete, with the owner on-site "for 10 months, six days a week, from 7 a.m. to 11 p.m., working with the most talented artisans and craftspeople on earth."

Wherever possible, original elements from the house were preserved: The stone lining the wine cellar was found and cut on-site, almost all the doors and windows were painstakingly salvaged, the facade’s iron grills were retained and replicated throughout, and an old painted frieze tucked into one corner was restored and finished. The original stained-glass windows were cleaned, with one pane revealing the house’s great mystery, told best by those who discovered it. "All the windows in the facade are original, with beautiful sandblasted designs," explains the architect. "After cleaning off one pane, we could make out three initials, and they matched the husband’s exactly—scary, isn’t it?" Adds the homeowner, "It was clearly meant to be that we found this house."