Mexico Lands Debut Real Estate CCD

The second and third certificado de capital de desarrollo (CCD) transactions of the year have closed, including the first supporting a real estate fund. A MXP3.30bn deal from commercial real estate developer AMB, which closed Friday, is the largest so far of any kind this year. A MXP2.75bn transaction from private equity firm Promecap is meanwhile the biggest from a pure private-equity fund. Other funds are looking to soon follow, accessing the country’s liquid pension funds, as the asset class continues to grow and the process becomes more streamlined. The 2020 maturity AMB deal priced at MXP100 is extendable by holder agreement. The return structure follows the industry standard model – investors get 80% of the fund’s proceeds and AMB receives 20%. This assumes that the buyers’ initial investment plus a preferred return – in this deal 9% – is met, according to regulatory documents. AMB’s fund will mainly focus on industrial land in urban areas used for logistic purposes, according to its prospectus. The deal received 14% more in orders than the MXP3.3bn limit, according to bankers managing the transaction, and was placed with 26 investors, including a sizeable participation from the government’s Fonadin infrastructure fund. Banamex and Actinver were the leads. The next CCD in the pipeline likely to price is another real estate fund from Prudential, through BBVA Bancomer. It is expected mid-August at a size of up to MXP6.5bn, and should also include Fonadin participation.