Resort Living to Transform Residential MarketThu, 11/01/2018 - 10:04
Q: What is Resort Living and what impact has it had on the Mexican residential real estate market?
A: We focus mainly on residential, hotels and mall projects but we strive to create truly unique projects. We purchase the best land possible to fit the unique needs of our projects. We specialize in the concept of Resort Living. In these type of projects, the goal is for our clients to feel as if they are on vacation or living in a hotel. People often believe that the concept of Resort Living will increase their maintenance and service costs. In these type of projects, we integrate all amenities, such as gyms, salons, yoga studios and parks, within the development itself. Because you already have all the amenities, you no longer have to pay for them in another place and you do not have to leave your complex. With our newest project, Avenue Polanco, in Mexico City, we created a 1,500m2 park, which is very difficult to find in the highly popular Polanco neighborhood. We are involved throughout all the phases of our projects to ensure quality.
Our projects also tend to boost the value of an area. For example, our project in Guadalajara, The Landmark, has drastically increased the value of the surrounding area. Two years ago, prices were at MX$45,000/m2. Now, prices have jumped to MX$75,000/m2. Once we complete the project we are confident that prices will increase even more. The market is looking for new and unique products and people want to have everything they need near their home.
Q: What segment of the Mexican population has embraced Resort Living the most?
A: In most cases, our market is young people and families. Older generations sometimes do not understand why they should sell their homes and move into a much smaller apartment. But the young generations understand that moving to an apartment does not mean that they are only purchasing a 180m2 space. They are also purchasing their share of the pool, spa, gym and gardens. They do not have to worry about providing maintenance for the day-to-day demands of a house. Contrary to what many believe, young generations are buying homes; they are just demanding a different product. The rental and sale market for apartments are completely different but at the same time they complement each other. Younger clients will want to rent and live near the centers of their everyday lives but once they grow older and need more space or want to settle down, they will purchase larger products like the ones we offer.
Q: What made Privada 14 such a successful example of Resort Living?
A: Our projects must be the best they can possible be in all aspects. In many cases we use most of the land for our projects to offer the best quality. For example, we prefer to develop 150 apartments that are above par instead of 180 regular apartments. We are willing to sacrifice space to boost the value of the other aspects. Privada 14 in Bosques de Las Lomas was constructed four years ago. The apartments were between 400-800m2 but the terrain is 40,000m2, 20,000m2 of which is next to a canyon. That type of land no longer exists. We had the permit to construct only 76 apartments. This project was sold completely in only six months at a price tag of approximately US$1.5 million per apartment. We took it as an opportunity to show our clients that we would exceed their expectations and invested even more on the finishes.
Q: How does GFA maintain its position in a highly competitive market?
A: Years ago, the market had only a few options when it came to purchasing residential real estate. There are many small developers in the market that would simply purchase land and develop any type of project. But the learning curve in real estate development allows us to improve our product continuously. The most important thing a developer has is its name. Creating projects that exceed expectations and leave buyers happy will ensure the reputation of the developer. We have many alliances but we always want our partners to think like we do and prioritize the same values as GFA. One of our strongest partnerships is with Thor Urbana.