For more than a decade, specifically in 2011, Real Estate Investment Trusts or FIBRAs (for their initials) were created. FIBRAs are vehicles specialized in investing in real estate assets for rent that are listed on the stock market and allow for capital gains or capital gains.
Likewise, the holders of the Fiduciary Stock Certificates (which are equivalent to shares) have the right to receive as dividends at least 95% of the fiscal result generated in a calendar year. Below we present the main characteristics of these vehicles:
Fibras can invest in any sector as long as the assets are focused on generating income. There are diversified Fibras such as Fibra Uno that have assets in various sectors such as industrial, commercial and offices in their portfolio. There are other Fibras such as Prologis or Fibra Shop that are concentrated in a particular sector such as industrial and commercial, respectively.
Fibras in Mexico can only invest in national territory and due to the tax regime they cannot make investments in other countries. However, Mexico is strategically positioned to benefit from global trade, tourism, manufacturing and emerging consumer flows.
Institutional and foreign investors seek to allocate funds in liquid instruments that are linked to different sectors such as real estate. If we add to that the interest in investing in emerging markets such as Mexico due to attractive rates of return, Fibras usually attract high sums of capital from this type of investors.
In the private market, for an investor to have access to the real estate market, he or she must invest significant amounts of money. In the public market, such as Fibras, small investors can buy shares and have exposure to the real estate market from 20 pesos through brokerage firms.
Holders of CBFIs or shares of a Fibra have the right to receive dividends once a year for at least 95% of the fiscal result. Dividends come from the collection of rents less operating, maintenance and interest expenses (in case of having debt). Historically, dividends range between 4% and 8% annually.
On the other hand, Fibra shares tend to appreciate over time, reflecting the capital gains of real estate assets. In this sense, investors obtain returns in both ways, which makes Fibras a very attractive instrument because they have characteristics of the debt or bond market (dividends) and the stock or capital market (appreciation of the share price).
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