FIBRAs, on the Road to Recovery

Despite the challenging scenario brought by the pandemic for Real Estate Investment Trusts (REITs), the outlook for the future is optimistic. According to Alejandro Delgado, Director of Operations at Siila México, there is an area of opportunity in this niche in the country, not only to sustain the current instruments but also for significant expansion.

In an interview with Revista Inversión Inmobiliaria, Delgado emphasized that REITs have undertaken important strategies to navigate the challenging environment brought by the contingency. While some assets were more impacted than others, the measures taken have allowed the trusts to face the challenge and move towards recovery.

Delgado pointed out that industrial-focused REITs have had the best results during the pandemic, even experiencing significant growth.

On the other hand, he noted that REITs with office, commercial, and hotel assets were more severely affected. However, he highlighted the constant recovery seen since the second half of 2020.

"There are REITs that are a bit more diversified. The particular case of Fibra Uno is quite interesting. They have approximately 50% of their portfolio in industrial assets, but the rest is also diversified in offices, commercial centers, and even hotels. Fibra Uno's recovery has been consistent, which has allowed them to reach pre-pandemic levels," Delgado explained.

"On the other hand, we have some REITs that were slightly more affected. Specifically, in the case of two hotel-focused REITs, Fibra Hotel and Fibra Inn. They experienced the greatest impact in the second quarter of 2020. The good news is that from that second quarter of 2020 until now, they have been steadily recovering, but they are not yet at pre-pandemic levels," he highlighted.

Alejandro Delgado discussed the outlook for REITs and highlighted some niches of opportunity that could contribute to the recovery of this segment and the real estate industry as a whole.

He emphasized the need to monitor the progress of the vaccination strategy. Delgado considered it good news that people are eager to leave confinement and visit shopping centers and travel.