The Brilliance of Burgherdom

What led to the decision to branch out into the middle-income market?

We saw a great need for people in that income bracket as credit mortgages were becoming more available and competitive. Mortgage rates were falling close to single digits; traffic in the city was becoming crazy, and every development was being pushed to the outskirts of Mexico City. We were one of the first developers to construct large projects with big living spaces, underground parking, recreational spaces and amenities, and tall buildings of 150 units per tower. It was quite risky; if a company has too much inventory it has to do a great deal of presales and it has to educate that market that presales are a great investment. It was common sense to enter this market, as there was demand and stability; we could give people something for a similar price within a great location and great amenities. We received another large push from our investors.

Are the different parts of the business managed separately or are they integrated?

They are integrated in the sense of mixed-use projects, which are strategic, especially in Mexico City. We are one of the leaders in mixed-use developments for the middle-income segment. Our middle-income development arm, Reside, is developing several large mixed-use projects while in the high-end market we are participating in a large mixed-use project in Santa Fe.

What distinguishes a Copri project?

In general, our philosophy is to improve the standard of living of our clients; that philosophy applies not only to direct clients in terms of our residential business, but also to the users of toll roads or our shopping malls. Mixed-use makes sense in terms of improving people’s lives so that is our main strategy. We also do mainly large and sustainable projects, which is another way of differentiating ourselves.

Why do you mainly focus on projects in Santa Fe?

We are in Quintana Roo, Cancún, Playa Del Carmen, and Querétaro; however, 80% of our projects are in Mexico City because there is a great deal of opportunity there. We have expertise in Mexico City and it is one of the fastest-growing economies in Mexico, which is also one of the most stable and best places to be in terms of thinking in the long term. We like Querétaro, where we have new projects; we are starting our fourth project there.

How would you characterize the environment for financing for the real estate sector in Mexico right now?

In terms of banking, we have relationships, with the majority of the banks and our model has worked, so we have formed great relationships with them. We are becoming competitive in the sense that we get financing relatively quickly and on great terms. In terms of equity partners, we had a solid relationship with LaSalle investment management; we did several projects with them and are now in the final phases of certain residential projects. One is mixed-use development that includes residential and commercial. We are in the initial phase with Walton Street Capital and are doing interesting things with them as well.

What current project are you most excited about?

In the residential business, we are beginning to move out of Santa Fe; we have an exciting project in Las Flores near Periférico Sur. We are working on a 330-unit project where the average price for a unit is around USD400,000. For residential mixed-use, we have two new developments under construction for the middle-income segment. One is at Parque Jardí­n, which has a shopping mall and 1,800 units with great amenities. Then, we have Parque Sur in Periférico Sur, which has hotels, office building, 600 units, and a small shopping mall with a supermarket and service shops. That said, the most exciting project is a 23,000sqm-office building in Vasco de Quiroga.