Recent events in the US have resulted in depreciation, instability and a rise in unemployment In Mexico – what steps should be taken to remedy the present situation?
Apart from the international noise that there has been, largely from the United States in these months, we must have faith in Mexico as internally many opportunities exist to keep growing. We must support the local market, ignoring the noise that surrounds us on an international level.
Despite this period of uncertainty, the Central Bank of Mexico predicts that the economy will grow by between 1.5%-2.5% this year. What makes Mexico one of the world’s financial powers?
Mexico has more than 120 million inhabitants, and more than half of the population is under the age of 30. This makes for huge potential, as every year our labour force grows and this boosts consumption, which in itself drives the economy. Additionally, Mexico is a neighbour to the largest consumer market in the world – the United States. If we serve both markets well, the internal and the external, the Mexican economy has a lot of room to grow. In our case, we are focussed on Mexico City, where there is a large market on which to focus. In terms of real estate, we appreciate the need for a more vertical city and always within the mid-income segment.
Are consumer habits in the Mexican real estate sector similar to those in the rest of Latin America?
There are many similarities, as in general in Latin America in recent decades there has been a great migration from the country to the cities. These numbers will continue to grow and require the constant improvement of housing within the cities – not in the peripheries. What affects people most is the issue of mobility, so we need to generate offers at attractive prices in our cities. In this way we will achieve reduced commute times and sell quality of life, which is something our clients value highly.
VEX Capital has the support and experience of a group, which is a leader in the real estate sector. Could you describe this relationship?
Vex Capital was born from the experience of a real estate group with more than 30 years of development in Mexico City, in office space as much as living spaces. VEX Capital is the result of a long process of institutionalisation with the intention of dealing with institutional investors.
In what way do you work as a platform for the administration of institutional capital focussed on housing activities in Mexico?
We recently started our first investment fund (CKD) in Mexico, focussed 100% on the development of vertical urban housing in Mexico City and in neighbouring urban areas in Mexico State. We decided to remain focussed on the segment that we know well. We have an expert team for this segment and we trust that this focus will result in better projects, better housing options for our clients and better results for our investors.
What objectives or plans do you have for the short term?
Our immediate objective is, in four years, to invest the capital that our investors entrusted to us within our new fund. Currently we are focussing heavily on looking for opportunities to develop projects: with this new fund we are looking for invest in around 40 new urban vertical living projects. Once this process is completed we will return to the investors with the completed product and strong results to look for further funds. It is worth mentioning that development and construction of these projects creates thousands of jobs in the city and will revitalise a number of neighbourhoods.
Will the capital raised cover all of the projects?
Not entirely. The capital will only cover the initial investment, which is used for the purchase of land, establishment of the project and necessary permissions. Afterwards, construction of the projects is funded via bridge loans.
What experience, personal and professional, do you bring to the table?
A long professional life accumulates plenty of experience. I am a civil engineer, but have always preferred finance and spent the majority of my career working in finance roles. I am now able to combine the two, evaluating and supporting investments to develop housing projects. My experience in both has been a great aid both personally and professionally.
Do you have one final message for the readers of TIME magazine?
That they take the time to truly understand Mexico. Underneath all that is happening, Mexico has great potential, something which little by little is bearing fruit.