VIEW FROM THE TOP
EXPANDING SOUTH TO MEET UNDERSERVED DEMAND GONZALO ROBINA Co-CEO of Fibra Uno (FUNO) and President of the Mexican Fibras Association (AMEFIBRA)
Q: What challenges have Fibras faced in 2017 and what
instruments. So far, the regulation remains as it is but some
has been done to overcome them?
points have been clarified and made more flexible.
A: This has been a challenging year, mainly due to three 204
macroeconomic factors: the increase in interest rates,
Q: How are Fibras changing in Mexico, compared to
the elevated US dollar-Mexican peso exchange rate and
similar financial mechanisms abroad?
higher inflation. Also, international investors withdrawing
A: US instruments date from the early 1970s, and like
from emerging markets due to perceived speculation
in Mexico, were originally diversified in several sectors.
produced a surplus of Fibra certificates, which lowered
The US instruments are specialized at the moment, which
their price.
I believe sets the trend for Mexico, as we have Fibras, such as Terrafina and Prologis, which are specifically
The restored confidence in emerging markets is an
designed for one industry. In the long term, instead of
opportunity, given the existing liquidity in international
one large, diversified Fibra, I think we will have different
markets. Portfolio managers are returning to emerging
small ones for specific sectors. FUNO has not done
markets. Fibras are appealing in this scenario because
this so far because we believe that our business is more
we are trading under the net value of our assets. For
profitable using the current strategy but as soon as we
example, if a company buys shares of FUNO at the
find specialization more advantageous, we will move
moment, it basically purchases real estate assets at a 25
toward it. The size of our company allows us to divide
percent discount.
into smaller Fibras that can thrive independently.
Regulations bind Fibras to invest at least 70% of their assets in real estate for rent, and 30% in other financial instruments
Q: What is the importance of the investment made by Afores in Fibras? A: Most Fibras have been anchored to an Afore, which for us represents the patrimonial investment of Mexican citizens. Afores, in return, find Fibras as a very useful vehicle to ensure their assets are invested in a very solid sector, with high capital returns, especially given that they often have the resources but lack a solid long-term
Q: What is your view of the regulatory changes recently
investment opportunity.
made to Fibras in Mexico? A: There have been several positive changes, characterized
Q: What do Fibras need to do to remain a competitive
by the goodwill of the governing institutions, that have
investment option for Afores given an open international
facilitated improvement. We have developed a recurring
market?
issuer program, which involves authorization for a
A: Since their creation, Fibras have been regulated by
certain volume of certificates, without them having to
two articles of the ISR Law. One says that their main
be processed at once, but gradually as a total allowance,
goal is to promote real estate investment in Mexico. It
providing greater market flexibility.
does not forbid investment abroad, but the incentive is to develop the national industry. Afores can buy shares of
Whether or not Fibras will be able to invest in projects with
any company but Fibras are mostly committed to Mexico,
returns obtained from sources other than leasing has been
regardless of whether or not it is possible to invest
an extensively discussed issue. At the moment, regulations
internationally. FUNO is committed to promoting the
bind Fibras to invest at least 70 percent of their assets
development of the industry in Mexico, and our capital
in real estate for rent, and 30 percent in other financial
will stay in the country.
