Macquarie Breaks New Fibra Ground

Macquarie’s Mexican real estate operation has priced a MXP14.95bn ($1.17bn) Fibra transaction, the region’s largest-ever real estate IPO. Though it comes in at the bottom of the price range, comfortably oversubscribed books offer continued demonstration of investors using real estate exposure to play Mexico’s expected growth story. The Macquarie Mexican REIT, as it is being called in marketing, priced 598m shares, including a 15% greenshoe, at MXP25.00 each, versus a MXP25.00-MXP29.00 range. The book went 70% to international investors, seen as key to getting the total size, according to people following the deal. A handful of US REIT-focused investors were among the US institutions participating. Buyers also included several Mexican Afores and accounts in Brazil and Chile. Macquarie is placing real estate assets into a fund to be capitalized through the REIT-like transaction, and use proceeds to acquire additional properties. The 245 properties in 21 cities in 15 states are to come from CPA Corporate Properties and GE Capital, and are mostly for manufacturing-related use. Macquarie plans to buy and hold 5% of the Fibra certificates. Bank of America Merrill Lynch, BBVA, BTG Pactual, JPMorgan, Macquarie and Morgan Stanley managed the transaction, the fourth-largest IPO by a Mexican issuer, according to Dealogic data. Bankers expect a couple more Fibra transactions next year, as the deals are not easy to put together even though investors want them. Still in the pipeline is a hotel-based Fibra from Hoteles Prisma. Macquarie is the final ECM deal from Mexico scheduled on the 2012 calendar. Issuers are hopeful that momentum from what has been the Mexican market’s best year in recent memory can carry into 2013. So far, a follow-on from Pepsi bottler Cultiba is in the works targeting $500m-equivalent.