from the heart of argentina to the world fernando reyna board member grupo edisurs strategy
TRANSCRIPT
From the heart of Argentina to the world
Fernando ReynaBOARD MEMBER
Grupo Edisur’s Strategy
Grupo Edisur ’s StrategyARGENTINEAN MARKET DOING BUSINESS…CONTENTS
Table of contents
ARGENTINEAN MARKETNot only adverse conditionsBut also strong opportunities
DOING BUSINESS IN ARGENTINAFinancing projects without banksPolitical and economic instabilityLack of reliable decision making scenarioNot qualified local partnersSmall market = Small opportunitiesLimited housing access
1
2
ARGENTINEAN MARKET DOING BUSINESS…
Grupo Edisur ’s StrategyCONTENTS
ARGENTINEAN MARKET1
Grupo Edisur ’s StrategyARGENTINEAN MARKET DOING BUSINESS…CONTENTS
Strong opportunities…
Adequate Debt BurdenBy 2010, External Debt Stocks (public and
private) correspond to 49% of GDP, showing a healthy financial status6
5 World Development Indicators & Global Development Finance (2005-2009), The World Bank.6 MECON – Ministry of Economy and Production, Argentina (2010).
7 GJP Morgan, Country Report 2010.8 www.Abeceb.com – Articles on International Trade (August – September, 2010).
Lower financial RiskSovereign debt of Argentina fell to its
lowest level since August 20087
Currency Stability Dollar exchange rate is estimated at $/U$S 4.25 in
2011 (following a hard currency approach to restrain inflation). Foreign Exchange Reserves
yield a 50M U$S record in 2010Consumer expectancy is supporting global growthTotal private consumption has grown at average 8% annual (for 2010). Hard goods purchases have grown near 23% (for national
gods) and 26% (for imported goods)
Record Trade Flows Biggest emerging economies Brazil, Russia,
India and China, count as our principal export’s destinies 8
Sustained Economic GrowthBoth public and private estimates agree that overall activity has recovered, forecasts stand
close 5% 5
Grupo Edisur ’s StrategyARGENTINEAN MARKET DOING BUSINESS…CONTENTS
But also strong opportunities…ja
n
feb
mar ap
r
may jun jul
aug
sep
oct
nov
dec
jan
feb
mar ap
r
may jun
Q1 Q2 Q3 Q4 Q1 Q22009 2010
-25%
-15%
-5%
5%
15%
25%
35%
Source: INDEC, Índice Construya
ISAC(Real Estate Growth Public E.)
I. CONSTRUYA(Real Estate Growth Private E.)
Real Estate activity at pre-crisis levelsBoth public and private data show that activity has already reached to
the levels pre-crisis of 2008
After 8 to 12 months of continuous annual growth, Argentina is working again at high levels of activity in the area
2000 2001 2002 2003 2004 2005 2006 2007 2008 20090
500,000
1,000,000
1,500,000
2,000,000
2,500,000
3,000,000
3,500,000
4,000,000
Yrd² Buenos Aires Yrd² Córdoba Yrd² Rosario
Fuente: Indec, DGEyC Córdoba, Dir. Obras Arq. Partic. Municip. Rosario.
Córdoba is the top city generating new private projects
Córdoba achieve not only high levels of activity during the crisis but also greater shares of the real estate market
2009/08Buenos Aires: ▼35%
Córdoba: ▲18%Rosario: ▼18%
ARGENTINEAN MARKET DOING BUSINESS…
Grupo Edisur ’s StrategyCONTENTS
DOING BUSINESS IN ARGENTINA2 Rough challenge
Financing Projects without banks
Bank represent only 4%
Due to the strength of its credit rating and its commercial skills, the company use alternative financing sources for it’s projects.
EDISUR STRATEGY
Pre Sales48%
Venture Capital 19%
Equity29%
! ALTERNATIVE FINANCING SOURCES
Political and economic instability
EDISUR STRATEGY! CREATE OPPORTUNITIES IN A VOLATILE MARKET
HIGH INFLATION LEVEL Properties as a value protection
WEAK RETIREMENT SYSTEM
A way to ensure savings in the future
OTHER ATTRACTIVE INVESTMENT
OPPORTUNITIES
Properties reveal as more profitable and certain than others options
EDISUR STRATEGY! MARKET KNOWLEDGE
Lack of reliable
studies and statistics
Market analysisSpecials Reports
Newsletter
Customer-focused growth
EDISUR STRATEGY
! INTEGRAL BUSINESS MODEL
Absence of institution
al investors
Financing & Feasibility
Project Design
Development
PromotionSales
Administration &
Management
Post-sales &Customer Loyalty
Age
Housing needs
705020 30 40 6010
Undeveloped market
EDISUR STRATEGY! PRODUCTS DIVERSITY Different residential categories to meet the needs and preferences throughout the life cycle.
Plots andHouses
GatedCommunities
Condominiums
Buildings
Plots and HousesGated communitiesBuildingsCondominiums
EDISUR STRATEGY! TO DEVELOP A POTENTIAL MARKET
Limited housing access
DEMAND80,000
SUPPLY20,000
60,000 families per year
without own house
Middle Income Market
New financing and investment system
360 apartments with amenities
Payments from U$S 363
high-impact urbanhousing development3
1
urban development lots1,30
0of developed living spaces
203,000 yr²
in development11,111
yr²
Built in different categories
670 acLots in immediate urbanization800
More than
1,500
And we have just celebrated
our 10th anniversary
| 10 years |
developing the city
owners