Mexico’s First Real Estate Trust Start Of A Trend – Minister

MEXICO CITY -(Dow Jones)- The creation of Mexico’s first real estate investment trust, Fibra Uno, will pave the way for additional funds targeted at specific sectors like infrastructure, bringing fresh financing to development projects, Finance Minster Ernesto Cordero said Thursday.

“With this action, the era of Fibras begins in Mexico,” Cordero said during an event at the Mexican stock market, using the Spanish-language acronym for the trusts, which are commonly referred to as REITs in English.

Fibra Uno was listed on exchange last week with an initial public offering that raised 3.62 billion pesos ($300 million), and the listing was formally celebrated on Thursday will a bell-ringing ceremony.

“Without a doubt, this is going to deepen the Mexican market, generate important sources of additional funding, allow workers great returns on real estate projects, permit small investors to penetrate the land development market, and fund long-term infrastructure projects,” Cordero said.

The new asset class, Cordero said, was a long time in coming, with four finance ministers involved in the project since 2003. Launching the first Fibra required new financial regulations to allow pension and insurance funds to participate, he said.

Luis Tellez, president of the Mexican stock exchange, said Fibra Uno certificates were held 77% by Mexicans and 23% by foreigners and listed exclusively on the Mexican exchange. The trust had 883 investors and an initial portfolio of 16 properties, including commercial and industrial real estate.