Last week, Terrafina announced that it is considering the request from six different companies to acquire more than 10% of the real estate trust certificates (CBFIs in Spanish) in circulation through a public offering to acquire up to 100% of said CBFIs. Among the bidders is Fibra Prologis, while Fibra Uno (Funo) intends to merge its industrial portfolios.
These offers come in a context where the industrial real estate sector in Mexico is stronger than ever due to trends such as nearshoring and e-commerce. In recent years, there has been a demand for over 60 million square feet (ft2), according to Datoz. This is an incentive for REITs and developers to have a more robust portfolio.
In response to this, Funo and Fibra Prologis aim to add Terrafina’s 290 properties, totaling 42.8 million ft2 (4 million square meters) of gross leasable area (GLA) at the end of 4Q 2023, to their portfolios.
One of the most relevant points that Terrafina must analyze is the price of the exchange of the CBFIs that the trusts are offering. While Funo offers an exchange of $49.63 MXN per CBFI, Fibra Prologis quoted it at $42.40 MXN. This Wednesday, March 13, 2023, the price of Terrafina’s CBFI was $44.50 MXN. These acquisition intentions have appreciated Terrafina’s CBFI, as it was trading below $37.00 MXN until February.
Funo’s offer
Fibra Uno proposes to merge industrial property portfolios to create the largest real estate trust in the country and Latin America, with around 11.6 million square meters (m²) of GLA. This represents a 12% share in the country’s industrial real estate market, according to Datoz.
This merged portfolio would consist of the contribution of its industrial real estate portfolio, Funo, with 6.1 million m²; plus, another 1.5 million m² of GLA from the Júpiter portfolio, owned by El-Mann family; and the remaining 4 million m² belong to Terrafina.
Fibra Prologis’ offer
Fibra Prologis aims to acquire Terrafina through a public tender offer (OPA in Spanish) and exchange of up to 100% of the CBFIs. With this, Fibra Prologis’ portfolio would reach over 90 million ft2 (8.3 million m2) of GLA, distributed across 526 properties.
Finally, in the coming weeks, Fibra Terrafina will decide regarding the various offers it has received, both public and private, to determine its future.
