How to structure Latam hotel Reits

Author: | Published: 12 Dec 2012

The first lodging Fibra (Fideicomisos de Inversión en Bienes Raíces), the Mexican version of a real estate investment trust (Reit), was offered by GDI Group on November 29.

The units were offered publicly on a Mexican exchange, sold to US investors through a 144A private placement, and in Europe through a Regulation S offering.

GDI’s Fibra, known as FibraHotel, is only the third Fibra offering and the first to be based on hotel payments. Earlier offerings were based on diverse portfolios of office buildings, shopping malls and industrial warehouses among other things.

The most significant difference in a lodging Fibra from a structuring perspective is the necessity of the issuer to separate hotel room rentals from other hotel expenses.