Fibra Next’s offering comes amid efforts by Mexico’s stock exchanges to boost activity following a prolonged lack of significant listings.
Fibra Next, a Mexican real estate investment trust, raised 8 billion pesos ($431 million) in its initial public offering (IPO), the largest stock debut in seven years.
The company confirmed that it sold shares known as CBFIs, which are part of Fibra Uno Administration SA’s industrial properties, for 100 pesos each. CBFIs are Mexican real estate trust certificates that represent ownership in a portfolio of real estate assets.
Fibra Uno Deputy Chief Executive Officer Gonzalo Robina stated that the company would use the funds to create 500,000 square meters of industrial real estate. According to Raul Gallegos, the company’s CEO, the company is looking to buy real estate as part of its growth plans, but it will focus on developing its properties.
They finalised the deal after many delays. The IPO was scheduled for 2023 and aimed to raise $1.5 billion, but it was postponed when tax authorities failed to provide a key sign-off in time. It got delayed again for an additional year as authorities requested more details regarding the carve-out. It then stalled as the Mexican stock market recorded its worst year since 2018.
According to Robina, the company will enter the market with a follow-up sale, which needs up to $800 million in additional funding to complete its growth goals.
When Fibra Uno brought back the plans to revive it amid a surge in the emerging market, the offering hit another setback in recent weeks when Altor Casa de Bolsa SA replaced CIBanco’s place as its common agent. CIBanco was one of three Mexican financial institutions labelled by the US Treasury Department’s Financial Crimes Enforcement Network (FinCEN) for primary money laundering concern, thereby severing their ties to the US financial system.
Fibra Next’s offering comes amid efforts by Mexico’s stock exchanges to boost activity following a prolonged lack of significant listings. The last significant initial public offering was in 2018, when a real estate trust associated with an airport project was sold for $1.6 billion, previously cancelled by former President Andrés Manuel López Obrador.
Discount retailer BBB Foods Inc. decided to go public in the US last year in a bid to access better values on a more liquid market. Robina continued that it was the sign many people were waiting for to confirm that Mexico’s capital market is ready to grow again.
The officials pointed out that the country is less exposed to trade disruptions related to US tariffs on cars, steel, and aluminum, given that 75% of its current properties are in logistics that meet local consumer demand.
According to Robina, the remaining 25% is Northern Mexico, an area typically focused on exporting to neighbors in North America. Despite US tariff threats, the company has not seen any decline in demand or cancellation of contracts.
Fibra Next offers two opportunities for international investors: capital growth from a high-growth industry and potential income from dividends.
The company’s connection with nearshoring and e-commerce trends helps it gain from $592 million in total capital raised and a predicted 7.23% CAGR in industrial real estate through 2033.
In conclusion, Fibra Next’s initial public offering (IPO) is more than a financial milestone; it is a gauge of Mexico’s economic recovery. The company’s strategic assets, strong financials, and alignment with the global supply chain make it appealing for investors to add to their diversified portfolio of assets. As the Mexican stock market gains its footing, Fibra Next enters a new era in industrial real estate, a sector poised to generate both growth and revenue in the years ahead.
