WHERE THERE’S LAND

Ecuador 2013 | REAL ESTATE & CONSTRUCTION | INTERVIEW

TBY talks to Joseph Schwarzkopf, General Manager of Uribe & Schwarzkopf, on the company's ongoing projects, including the landmark Ciudad del Sol.

Joseph Schwarzkopf
BIOGRAPHY
Joseph Schwarzkopf graduated with a degree in Finance from Florida State University. Prior to his current position, he was Manager of Constructora Miracielo, Commercial Director of Paseo San Francisco, and Executive President of Hotel Le Parc. He is also an active member of the Young Presidents Organization.

What led to you establishing Uribe & Schwarzkopf in Ecuador, and how has the company evolved since?

The company started in 1973. We are in a business that is very dynamic; the market and our targets change constantly. It's been changing from housing to rental and commercial projects. It is very difficult to say what our core business was 40 years ago compared to today. Currently, our position is that we are a housing company and our main business is to build residential projects. We have a specific target in the market and we are always going after that. We also build housing projects; not individual houses, but urbanization schemes. We also build many commercial buildings, and we recently built our first shopping mall. In addition, we have built and managed hotels. Uribe & Schwarzkopf's main focus is on housing, and it is expanding in Quito and the surrounding areas.

Who do you define as your target market?

It is an open target. We aim for the middle and upper class. We like to work very closely with the banks and the social security organizations since they provide most of the mortgages. We always realize projects that fit their financial products. Approximately 70% of the people that buy from the company use mortgages to finance their purchases.

What are your main competitive advantages?

Our main competitive advantage is our brand. Uribe & Schwarzkopf has never been late on a project. The maximum overrun was two or three months, which is normal for a large residential project. Over 30% of our clientéle come back to buy another unit from us. We have an excellent customer support team that helps consolidate our brand and gives value-added services that are better than our competition. Another thing is that we do everything in-house here, such as our architecture, sales, building, marketing, and mortgages. We provide many services to our clients based on their financial situation. If you want to apply for a loan from the social security institution, we help you do it via our owncredit department. We also have an internal legal company so that all the paperwork and contracts can be officiated here. It is like a one-stop shop. At the moment, we don't have our own interior design section, but I want to one. Right now, there is a lot of competition in the country. The last two or three years have been very good because of the money that the banks and social security organizations have been lending; it is like a pump for the business and now the market is steady and growing. The middle class is growing because they have access to credit, and the first thing they do is buy a house or property. The price of land has increased, and so has the price of commodities. The price of prime land has risen two fold in just a year. Also, the final price of housing for the customer has gone up; not as much as we would like, but in some sectors it has risen 15%-20% a year.

There are many people trading between Guayaquil and Quito. Do you see this as a big opportunity?

Yes, it is, and we are aiming projects at investors. I can see now that people have liquidity, and they have a mind to invest. Many clients come to buy units for rent and that has been a good business for them. We are targeting projects at those kinds of clients from all over the country, not only in Quito. It is always going to be a good investment and the prices are going to go up. Quito is still the cheapest capital in South America for real estate. That is a good thing about our business—it has never had a boom. It has gone up step by step, which is good because there is no speculation or false business expectation. In regards to office projects, we conducted a study and found there was a lack of quality space available. The growth of the country is attracting more projects from mining companies. Everybody is going to start looking for offices.

What are your plans for the short to medium term?

We are planning a huge project that is going to be the biggest we have ever built, namely Ciudad del Sol. It will contain one of the tallest buildings in Ecuador. It will have a hospital, hotels, commercial space, and residential areas. It is a dream project for everybody in this business. It will probably start in 2014 because we need to plan it carefully and budget it right to start selling the units. It will probably take six to eight years to build. Residents will belong to a city within a city, and that is the concept we are trying to sell. Before this, the biggest project we did was Parque Real, which was a residential project consisting of 15 buildings that we finished in 2012. It took us eight years to finish. It has two buildings of suites, one office building, and 12 residential buildings. It was the biggest project up until Ciudad del Sol, which is a different concept because that is more like a city within a city.

How do you promote the company and get involved in your work?

We have always innovated in our projects. We change the architecture and always offer different ideas or services inside a building for our clients. For example, we are introducing small movie theaters, spas, or gyms inside our buildings. We do something better each time and we innovate. That is the key; being different from the competition. If you buy from us you have something different. We have a good history in building, as well as always offering good value in our properties and maintaining their value over time, which is very important for our repeat clients. We try to maintain that for the future so our buildings sell well. Our target market is the first-time buyer and real estate investors. Our vision is to always try and maintain our buildings at the highest standards.

How would you rate Ecuador's human capital?

Our company has been here for 40 years and the majority of our employees have been here for over 20 years. We have very steady human capital here and very low staff turnover. We offer internship opportunities for young people because we need new innovations, and young architects come with fresh ideas.