Mexico, a great alternative
Currently, Mexico is experiencing one of the strongest recessions in several decades, however, there are those who claim that there is a light at the end of the tunnel.
In an analysis carried out by Barclays Research, a company with a presence in America and Europe, specialized in the study and research of more than eleven industries, ranging from energy and healthcare to technology and financial services, it is revealed that the Real estate could be the relatively safest investment option in this volatile economy.
It is not news that the strong contraction of the country’s Gross Domestic Product (GDP) will have an impact on unemployment and consumption. The OECD (Organization for Economic Cooperation and Development) foresees a drop in world GDP of 6% due to Covid-19 and for Mexico it is estimated, a GDP collapse of 7.5%.
However, Barclays Research analysts claim to have a positive position on the real estate industry in Mexico, which is based on four main reasons:
Its high dividend yields for 2021 with an industry average of 10%
Low levels of leverage of its participants in the stock market
Encouraging Long-Term Industry Trends
There are, in particular, two fundamental variables, which are positive in the industrial real estate sector, because analysts consider that industrial activity in the country must continue its course. The first variable is the entry into force of the T-MEC (Treaty between Mexico, the United States and Canada) where they foresee that many companies will move their supply chains to Mexico; and the second variable is that electronic commerce should boost the demand for the logistics space.
Under this context and panorama, how could the State of Yucatán benefit?
The Yucatan peninsula, strategically located, is a logistics platform that represents the interconnection of Mexico with the whole world. Being a place with so many tourist attractions and that has grown in the service sector, it is ideal for trade and investment, explains Alejandro Granja Peniche, CEO and Founder of Grupo Colorines. Referring specifically to the T-MEC, he emphasizes that “it will be beneficial because the Peninsula serves as an entry and exit point for the entire east coast of the United States, at the same time as a connecting bridge with Central America and the Caribbean Sea.”
Yucatán is seen as an industrial pole that is being born. “Mérida has 1,250,000 inhabitants who have mainly worked in the service sector, but industrialization has already started to take off in the state. There is the Progreso Port, the longest in the world, an important point for export and import, with great infrastructure and a great logistics capacity that will serve to attract investors, it is a boutique port for any company that arrives because it is currently underused ”, points out Granja Peniche.
Under this scenario, a growth of the upper middle class is estimated in the next 10 years that will go hand in hand with industrialization, which, obviously, benefits from the Free Trade Agreement. This situation will increase the demand for housing, having a positive impact on the real estate sector.
Why invest in Yucatán?
In recent years, a great investment opportunity has arisen in the Peninsula, becoming, for many, the ideal place to invest. There are many reasons associated with safety, quality of life, capital gains, incentives for companies, location, among others.
The state offers security, quality of life, many tourist services. This attracts many corporations not only from Mexico but from international companies.
Alejandro Granja, explains that “there are multiple reasons that confirm the above. To begin with, Yucatán is located in a strategic area, being located in the Southeast of Mexico, being one of the best places to visit, do business or as the perfect place for a residence ”.
Additionally, it highlights that the great returns of the real estate industry are on the ground. “In Mérida, land has a lower price value with a higher quality of life, which in the end is attractive in the medium and long term,” he said.
The state has a vast natural and cultural wealth, the hospitality of its people, minimal industrial pollution and an environment of social and labor peace, which positions Yucatan as a state with a high quality of life; without forgetting that it has the Progreso Port, as well as two airports: the International Airport of the City of Mérida and the recently reactivated Chichen Itza International Airport, expanding its connectivity with the rest of the world.
Regarding the current situation we live in the world, Alejandro Granja, reminds us that, even in the face of this crisis, investing in land may be the safest decision: “Without a doubt these are times of change, there are those who see problems, others we see opportunities; But it is clear that real estate and land remain intact, retain their acquisition value and even continue to generate capital gains day after day. Yucatán is the best option to keep our investment safe and create our heritage ”.
Under these premises exposed by Granja and considering the study by Barclays Research, we can conclude that given the challenges posed by confinement and all the impacts it has had on sectors such as the economy, Mexico continues to be an option for investment in the real estate field . That is why it is important to be attentive to opportunities, to invest safely and that will undoubtedly make you guarantee your future, creating Heritage.