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Real estate GPs raise $730m from Mexican pensions

Mexico released statistics showing that fund managers raised more than $3bn from Mexican pensions to invest in private funds, including real estate-focused vehicles.

About Ps.$36.4 billion (€2.3 billion; $3 billion) has been raised since July 2008 through a new kind of security for investment in Mexico, according to figures released by the Mexican National Commission for the Pension System, including Ps.$8.8 billion or $730 million by three real estate funds.

The securities, called certificados de capital de desarrollo, or CKDs, allow Mexican pensions to invest in  real estate, infrastructure and private equity funds via publicly listed trusts. Other investors can purchase CKDs in these offerings, but the commission said Mexican pensions had invested about 90 percent of the Ps.$36.4 billion raised.

Three offerings took place last month alone: Navix, a debt fund that collected Ps.$4 billion; I Cuadrada, an infrastructure fund associated with the Black Creek Group that raised Ps.$2.7 billion; and Marhnos, a Mexican developer and concessionaire that raised Ps.$1 billion.

The commission said in a statement “investment in instruments like CKDs” creates jobs and economic growth for the country – a key priority for Mexican President Felipe Calderon.

Industrial fund manager and REIT, AMB, was the first firm to raise a real estate CKD in July, raising Ps.$3.3 billion in equity, 81 percent of it from the country's pension funds. That was followed in August by PLA Inmuebles Industriales, a fund from Prudential Real Estate Investors, which raised Ps. $3.1 billion, 80.6 percent of its from Mexican pensions. Artha Capital raised Ps. $2.4 billion for its Artha Operadora fund that same month, targeting housing, tourism, commercial and industrial real estate projects. Just over 60 percent of the equity was invested by pensions.

One of the earliest groups to raise money through CKDs was Red de Carreteras del Occidente, co-owned by Goldman Sachs and ICA. Red de Carreterras del Occidente raised about Ps.$7.8 billion via these certificates in October 2009. Ninety-seven percent of that money was invested by pensions, according to the commission.

Fund or group Date of offering Amount raised Percent raised from pensions
Agropecuaria Santa Genoveva July 2008 Ps.$1.65bn 99.9%
Red de Carreteras de Occidente October 2009 Ps.$7.755bn 97.0%
WAMEX Capital November 2009 Ps.$750m 80.0%
Macquarie December 2009 Ps.$3.415bn 100.0%
Atlas Discovery Mexico December 2009 Ps.$1.161bn 88.8%
Nexxus Capital IV March 2010 Ps.$2.641bn 95.8%
Promecap July 2010 Ps.$2.503bn 94.4%
AMB July 2010 Ps.$3.3bn 81.0%
PLA Inmuebles Industriales August 2010 Ps.$3.095bn 80.6%
Artha Operadora August 2010 Ps.$2.44bn 60.4%
NAVIX December 2010 Ps.$4.002bn 98.5%
I CUADRADA December 2010 Ps.$2.737bn 82.9%
MARHNOS December 2010 Ps.$1bn 70.3%
Total as of December 30, 2010 Ps.$36.449bn 89.6%
Source: Comisión Nacional del Sistema de Ahorro para el Retiro (Consar).