Who are the main investors in your developments?
We have mainly Mexican families and businesses as our primary investors. We have established trust with people who know us, and they respect our reputation. We have a few international investors, and we are now in talks for a long-term investment with a European family office, which is an interesting project for Venit Investments. We have been working with American investors as well, but that started just last year. We also try to invest our own money in most of the projects we develop. This reassures investors that we have a personal stake in the outcome.
What made you decide to focus on medium-sized cities across the country, rather than on one geographical region in particular?
There are 50 or 60 players in the Monterrey market that are currently developing, or planning to develop, mixed-use projects. If you go to other cities, however, you begin to see that there are maybe only 10. It makes more business sense to invest in a place where you have fewer competitors. You have more potential in a growing city. Monterrey still has a substantial growth potential. We have investments here and new projects coming up, but we try to stay away from the main focus in the market.
How have demographic changes in Mexico driven your business model?
Urbanization started a long time ago in Mexico. Around 80% of the people here live in cities with a population greater than 15,000 people. At the end of the last century, everything was concentrated on three or four cities; Monterrey, Mexico City, Guadalajara and in a lesser way Puebla. What has changed is an increase in foreign investment, which created job opportunities and potential growth in other medium-sized cities. That is creating opportunities for people to experience the big cities but on a smaller scale. Querétaro is an interesting example, as it is a medium-sized city that has several of the most important business hubs and commercial centers. There is also now increased mobility in Mexico. Until a few decades ago, the country was traditional in that people were born, lived, and died in one place
How would you characterize Mexico's progress in terms of green or environmentally friendly construction?
We do not have a government agency that enforces anything beyond the basic requirements in Mexico. You have a few places that are trying to enforce green initiatives, but there is not enforcement like in Europe, such as the Carbon Fund. The second issue is the lack of demand. Building a certified LEED building is expensive, and to build a green building you need an investor who is willing to pay the extra cost—in Mexico there are few businessmen who are willing to invest at this level. Consequently, there are people interested in building those type of products, but they do not have the target market. One thing that we have been doing as a business is to try to find a work around: we do not certify our buildings, but that does not mean that we cannot apply some of the same technology and regulations. We based our construction models on a few of the LEED and European green certifications, and we analyze what can be applied to the project, and if the market is going to willingly accept and pay.
What are your goals for the next several years?
We are starting two large projects in Bajio; therefore, our top priority is to see them through to completion. One of them is a 10-year project, which is a good amount of time. We will start the first of seven buildings on that project, hopefully during next year. My priority is to consolidate those projects, as they are our largest yet and are important for us. We are also starting an interesting condo project in three different cities.