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Mexico Real Estate Trust and Mortgage Loans to Boost Market in 2013

11 January, 2013

The Wall Street Journal reported on two big developments for Mexico real estate in 2013, thanks to December’s launch of the $1.15 billion Macquarie real estate investment trust (REIT), along with the announcement from Inofavit that it expects to grant more than 545,000 mortgage loans in 2013.

“Macquarie said the REIT will use the money to acquire its initial portfolio of 244 industrial properties spread over 21 cities in 15 Mexican states,” wrote the Wall Street Journal. “The properties had an average occupancy rate of 91 percent at the end of September.”

In addition, mortgage loans offered by Inofavit, which is Mexico’s government-run mortgage lender, are projected to supply more than 2.37 million mortgages between 2013 and 2017, totaling an economic impact of more than $78 billion.

“Inofavit loans have been a major driver of home ownership and growth for home builders during the past two presidential administrations, under the National Action Party,” wrote the Wall Street Journal. “President Enrique Pena Nieto of the Institutional Revolutionary Party, who was sworn into office for a six year term [in December of 2012],has expressed a desire and commitment to continue the federal government’s housing push.”

According to the report, employers routinely contribute funds to Inofavit on behalf of their employees, who are encouraged to use the money to purchase a home. Inofavit also offers credit, as do a number of private-sector banks. 2012 saw a similarly high number of mortgage loans being granted in Mexico.

Macquarie’s REIT, known as a Fibra in Mexico, expects net proceeds of more than $1.7 billion if its over-allotments are exercised. The properties it is actively purchasing are being acquired from the real estate firms GE Capital Real Estate Mexico and Corporate Properties of the Americas. Shares were initially trading at just over $2 in this important local and global offering.

Topics: Real Estate Mexico Mortgage