Shopping Centers Today is the news magazine of the International Council of Shopping Centers (ICSC)
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"There's no way that 10 years ago you would have been able to get [these funds] excited about investing in Latin America." management teams that strengthen operations and balance sheets. "There's no way that 10 years ago you would have been able to get [these funds] excited about investing in Latin America," said Cate Ambrose, president of the New York City–based Latin American Private Equity & Venture Capital Association, whose members are primarily the region's fund managers. "We were seeing a less developed region until a lot of people poured money into China and India, and those markets quickly got crowded and busy. It also turned out that they are not always easy places to do business when compared to Latin America." Such investment in Latin America reached a record $10.3 billion in 2011, up 27 percent from 2010. The Asia-Pacific still commands the highest amount among emerging markets: $30 billion in 2011, of which $16 billion went to China. But Latin America is on the rise, and observers are expecting recordbreaking figures for this year. Latin America figures for 2012 were not yet available at press time, but industry observers expect a drop that is typical of a cyclical business in which a period of capital-raising is followed by a relatively quiet period while investments are identified and made. "Even with the global downturn in 2007–2009, Latin America came out very well," said Ambrose, "and in the new cycle of fund-raising, there was 234 SCT / M a y 2 0 1 3 Zingara is one of nexxus Capital's many retail investments in mexiCo. a new level of confidence, and Latin America became the most attractive region to invest." There are solid reasons why investors should be attracted to Latin America, given the region's growing economies and burgeoning middle classes, observers note. "This is not about whether Latin America can get a higher share at the expense of other markets like Asia, but about if Latin America can remain a bona fide allocation region for institutional investors in emerging markets," said Chris Meyn, a senior partner at Gávea Investimentos, a Brazilian asset management firm with investments in Brazil's retail industry. "And the answer has been yes for the past 10 years." Three-quarters of investors in Latin America see the region's economic growth potential as greater than other private equity markets, according to one survey. Consumer goods are at the top of the list of appealing sectors. Brazil has been capturing most of the money, with five Brazil-dedicated funds accumulating a total $8.1 billion in 2011. Mexico, Colombia and Peru are among those gaining ground, though, and retail is an investment target. In Colombia the Color Siete clothing retailer, the Andrés Cara de Res restaurant chain and the Bodytech gym chain have tapped into private funds. The portfolio of Nexxus Capital, the largest equity fund in Mexico,