In 2021, the educational segment remained resilient despite the “online class” models. Educa, the only Fibra focused on this sector, had a solid increase of 86% in the value of its CBFI
The Real Estate Investment Trusts (Fibras) sector represents an investment opportunity in real estate in Mexico, an interesting option given current market valuations that do not fully integrate the operational and financial recovery that would continue into 2022.
According to our calculations, the gross leasable area (GLA) of the sector was made up of around 25 million m² at the end of 3Q21, without integrating 19,000 hotel rooms in operation.
This figure has the potential to increase in the short term, assuming that administrations have greater operational clarity given greater mobility of the population, consumer confidence, and the strength of portfolio tenants.
The industrial segment has shown significant growth in new properties, as was the case of Fibra Prologis and Fibra Mty, which recently made acquisitions for more than 90 million dollars in total.
The industrial segment benefited during 2021 from the increase in demand for logistics real estate after the Covid-19 pandemic, the advancement of electronic commerce and the supply chain crisis that affected it globally. In terms of net operating income (NOI), Fibra Prologis increased 14% and we estimate that Fibra Mty will also reach these levels.
The commercial segment presented significant setbacks at the beginning of the pandemic, but 2021 was different with the strong recoveries in the influx to its properties. The Fibras adapted themselves using sanitary measures in their establishments and support was provided through discounts and deferrals to practically all non-essential tenants, as their income was affected the most. Fibra Danhos, focused on this sector, has shown NOI increases of 13% compared to 2020, without reaching pre-pandemic levels. We estimate that by the end of 2022 these levels will be reached.
The hotel segment was characterized by significant growth in occupancies in 2021, after the null operating activity since March 2020. The sector decided to suspend the distribution of dividends until showing recoveries in its financial results; we hope that the Fibras of this segment can reactivate them towards the second half of this year.
The office segment was affected in 2021 more than in 2020, mainly by the departure of tenants due to working from home or Home Office, so the occupancy levels of these properties fell significantly, reducing the average income of this sector .
The education segment remained resilient despite “online class” models. Educa (listing code: EDUCA18) —the only trust focused on this segment— had a solid 86% increase in the value of its CBFI (Certificado Bursátil Fiduciario Inmobiliario), and was also one of the few Fibras that did not make concessions through discounts or deferrals with tenants, and showing no impact on distributions despite the prevailing situation.
What can we expect for 2022? According to our estimates, the industrial segment would continue with solid results coupled with the growing demand for properties of this type, we would expect an increase in the total gross leasable area (GLA) of the segment as a result of different investments in acquisitions and developments.
For the commercial segment, we would expect a decline in some relevant operating indicators during the first quarter of the year due to the high levels of infections of the new Ómicron variant of Covid-19, continuing later with significant recoveries in the subsequent quarters due to the increase in the influx of anchor stores such as the entertainment segment, which has shown considerable impact since the beginning of the pandemic.
We remain optimistic about the office segment as we have seen an increase in demand for these properties.
This sector would present a slow but constant recovery approaching pre-pandemic levels towards the end of the current year.
Finally, the educational segment would continue to report solid results during 2022.