Mexico has been attracting foreign investment in the real estate sector for years, now; but lately, large portfolios of investment funds are arriving in force. There are at least 15 major league investment funds that have been injecting resources into commercial, office, industrial and housing real estate projects for three years now. Contrary to other industries, where investment is being attracted by competitive economies such as China, interest in real estate in Mexico remains very much alive.

What is behind these large investment fund portfolios? Profitability is the major reason, rating higher than thoat of the United States real estate, as well as consumption levels that cannot be reached in other consolidated markets in the world.

The investment registered in this triennium, and the one to come, is concentrated in the success and growth potential of some areas, such as shopping centers and residential housing.

Luis Gutiérrez, president of Grupo Acción, one of the Mexican firms with at least three major strategic investment allies (Kimco, ABM Properties and Grupo Lar), insists that any consolidation of real estate portfolios is based on the profitability that the project can provide. to institutional investors.

“In the industry no one can predict what will happen to the rates of return, however, they remain attractive to foreign investors,” he said.

Ricardo Zúñiga, general partner of The Peabody Funds, comments that the participation of resources from abroad has occurred through funds or strategic associations with Mexican companies. “Mexico’s country risk conditions are favorable, and much has to do with the market in the future in terms of income and development possibilities,” he indicates.

Grupo Lar España, with half a year of activities in Mexico, through its partner Grupo Acción, has projected to build, by the end of this year, 2,500 houses and maintain this rate in the coming years. The expansion plan of this Spanish company is to build middle-class housing in the Cuauhtémoc and Del Valle neighborhoods, in Mexico City, and in other areas of Guadalajara and Quintana Roo.

Amy Erixon, who has recently led Jones Lang LaSalle Investment’s $2 billion asset purchase in Latin America, says the Mexican real estate market is attractive even to international investors. “Of course there is no industrial explosion, like the one between Juárez and the United States, however, there are industries that are recovering strongly after the pandemic. This movement is generating a profound change in the position that the United States has regarding Mexico.” Erixon believes that the drop in profitability levels does not represent a greater risk: “On the contrary, it is easier for many companies to establish themselves in Mexico due to the growth possibilities.”

Undoubtedly, after industrial real estate activity, the sector with the greatest dynamics of development and attracting resources from abroad is that which corresponds to shopping centers. In 2022 alone, national and foreign groups will complete an investment of 3.1 billion dollars in 30 shopping center projects and specialty stores.

Despite the perception that there are obvious signs of saturation in this industry, the opportunities to generate profitable projects continue to attract the attention of multinationals such as Kimco Realty Corporation, The Peabody Funds, Chelsea Property Group and Mexico Retail Properties, among others.

Andrew Strenk, director of the firm Strategic Planning Concepts International, says that the investment opportunities in the commercial sector are in new design options and shopping center trends. “Just like in the United States, in Mexico the consumer is also changing. The days of Aurrerá, Gigante and Comercial Mexicana, centers with dozens of stores, are numbered. How many Satellite or Perisur-type plazas have been built recently? Not many. Developing wineries, specialty stores, movie theaters, restaurants, and Shopping centers that correctly read the trends will also benefit”, details Strenk.

This is how, not only national investors have been seduced by real estate investment, but also foreign investment has a keen eye on Mexico, in its various sectors, ranging from industrial, commercial, offices and more recently, housing real estate.

Edited from: realestatemarket.com.mx/articulos/mercado-inmobiliario/mexico-atrae-inversion-extranjera