FIBRA Educa Accelerates Expansion in 2024: Acquires Properties with a GLA Equal to 25% of 2019-2023 Acquisitions

FIBRA Educa strategically strengthens its portfolio in Mexico by acquiring five educational properties across three states, a move that increases its GLA by 8% and ensures financial stability with 15-year lease contracts and 100% occupancy.

The accelerated expansion of FIBRA Educa in 2024, with an acquired GLA equal to a quarter of what was bought between 2019 and 2023, underscores its growth capacity and long-term financial strength.

Raúl Martínez Solares Piña is the CEO of FIBRA Educa. Photo: SiiLA.

By: SiiLA News

08/19/2024

FIBRA Educa, Mexico’s pioneering real estate investment trust (REIT) specializing in educational properties, has made a significant stride by acquiring five properties. These properties, with a combined gross leasable area (GLA) of 45,121 square meters, are strategically located in the States of Mexico, Tamaulipas, and Coahuila. This strategic expansion bolsters the firm’s portfolio, increasing its GLA by 8%, as per SiiLA data.

The two properties in Coahuila have a total GLA of 23,857 square meters, the two properties in the State of Mexico have a GLA of 18,258 square meters, and the one in Tamaulipas has a GLA of 3,006 square meters. These spaces, comprising nine plots in total, will generate income through lease contracts with an initial term of 15 years, renewable for an equal period, ensuring cash flow stability for FIBRA Educa.

This lease term is one of the longest among the 16 REITs listed on the Mexican stock exchange, and it generates a 100% occupancy rate in addition to providing stable income. According to SiiLA FIBRA Analytics and company data, as of the second quarter of this year, FIBRA Educa’s properties were occupied under 21 contracts with six tenants and their related parties, all controlled by Nacer-Global, the company that established the trust in 2018.

The acquisition, whose value was not disclosed, was financed with resources from a debt placement carried out at the end of 2023, covering the VAT on construction and expenses associated with the transfer of ownership.

According to FIBRA Educa, the recent transaction not only strengthens its real estate portfolio but also promises to generate stable and attractive long-term financial returns for the trust’s investors, given that the acquired properties have an estimated cap rate of 10.60% and a net operating income (NOI) of 88.81%. However, SiiLA has assessed the portfolios' value and property profitability. This data is available on SiiLA Market Analytics.

FIBRA Educa’s Expansion in 2024

Since 2019, FIBRA Educa has acquired 20 properties. Photo: FIBRA Educa.

The recent transaction adds to the 67 properties the company currently owns, including 27 educational properties, 35 learning centers, and five offices. Together, they cover a GLA of 544,581 square meters and are distributed across 20 states in Mexico, predominantly in the Mexico City metropolitan area.

So far this year, FIBRA Educa has been on a trajectory of rapid growth. The trust has acquired six properties with a total GLA of 47,467 square meters, significantly surpassing the trust’s 2023 transactions, which added 2,255 square meters of educational GLA. This expansion is even comparable to more than a quarter of the GLA the company acquired between 2019 and 2022, highlighting the accelerated growth pace the firm has adopted in 2024.

In May, before acquiring the five properties, FIBRA Educa acquired an educational property of 2,346 square meters in Toluca, State of Mexico, with a 15-year mandatory lease contract extendable for similar periods at the tenant’s discretion. Before that, between 2019 and 2023, the firm purchased 14 properties with a combined GLA of over 188,000 square meters.

The recent transaction is a testament to FIBRA Educa's robust financial health. Despite challenges such as the temporary suspension of rental income from two properties in Acapulco, Guerrero, due to the damages caused by Hurricane Otis in 2023, the trust has demonstrated financial resilience. FIBRA Educa’s management has maintained adequate liquidity and the ability to meet financial commitments, as evidenced by a 136.35% increase in returns on investments permitted by the Income Tax Law (LISR) and a significant 19.81% decrease in financing cost amortization, compared to the second quarter of 2023.

For more information on the performance of REITs in Mexico, explore SiiLA REsource or email us at contacto@siila.com.mx.

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