Garbett Homes Ventures Into Mexico Housing

Having strong business relationships and networks are essential for any successful business venture.  These ties are especially important when expanding your business internationally.  No one knows this as well as Bryson Garbett of Garbett Homes. 

Garbett Homes, based in Sandy, Utah, is expanding their business into Mexico in an effort to diversify their business and at the same time provide quality housing to the underserved, middle class housing market.  Due to recent reforms and options in the finance market initiated under the Fox Administration, the middle class has increased access to mortgages.  Banks are currently lending mortgages up to $150,000.  Mexican President Vicente Fox has set a goal of boosting the number of mortgages provided in Mexico to 750,000 for 2006.  In 2004 alone, about 535,000 mortgages were provided, and both public and private creditors are projecting big gains this year.  BBVA Bancomer, a unit of Spain's Banco Bilbao Vizcaya Argentaria (BBV), plans to boost lending by 84% to individuals and 64% to developers this year. 

While mortgage financing is now more readily available to the middle class, housing is scarce.  There is a 6 million housing deficit in Mexico.  Once Bryson learned about this housing need, he saw a prime opportunity to accommodate this market niche and expand his business. 

Garbett Homes specializes in multi-family townhouses which primarily target first-time homebuyers.  This style of housing is what Bryson plans to bring to the Mexican market.  Concrete homes are the standard construction medium for all homes in Mexico and while he has not previously built concrete homes, Bryson plans to use this method of building in his Mexico project.  Concrete homes can be built up to 73% faster and with fewer workers compared to other building methods.  CEMEX, the third largest cement producer in the world, is based in Mexico and will be participating in NAHB’s 3rd International Housing Conference of the Americas, November 3-5, 2005 providing information for builders, like Bryson, who are interested in constructing concrete homes.

Ventures Into the Unknown
After teaming with Mexican businessman Carlos Zepeda Reynaga, Bryson was ready to begin his journey south.  Carlos, a chemical engineer with an MBA from Brigham Young University, had no previous experience in the housing sector.  However, after attending numerous NAHB events including the 2nd International Housing Conference of the Americas in Mexico in 2004, Carlos has gained important insight and knowledge about the housing sector.  He attributes much of his success and smooth transition into the industry to the valuable contacts he has made in the industry — particularly at NAHB’s Mexico Conference.  Through these new business acquaintances, Carlos was referred to many other key individuals throughout the housing sector, including financial organizations and real estate developers. 

Encountering differences between Mexican and U.S. business practices are inevitable; however, both Bryson and Carlos have found that their strong business relationships and affiliation with NAHB have greatly helped them along the way.  While financing presented an initial obstacle, NAHB’s Rita Feinberg, Executive Director of the International Department, provided them with information about potential financing options and key contacts, which proved invaluable. 

Garbett Homes has been legally incorporated as a Mexican business and is currently in the process of negotiating the purchase of about 30 acres land.  Garbett plans to build between 100-500 homes.  These new townhouses in Mexico will range in price from $140,000 to $170,000.

Carpe Diem: the Mexican Way
While expanding into Mexico was intimidating at first, Bryson found encouragement in the numbers.  And, after meeting many other American housing sector professionals at NAHB events who were also crossing the border to do business, his decision to expand into Mexico was cemented.

Garbett Homes’ advice to those thinking of seizing the opportunity to expand to Mexico is to establish good relationships, be flexible and open-minded to other cultures and customs, exercise caution but know when to be aggressive, and take full advantage of NAHB seminars, conferences, literature, and staff assistance.

In November 2005, NAHB will host its 3rd International Housing Conference of the Americas in Mexico City.  Take this opportunity to learn about the exciting opportunities for housing sector professionals to expand, diversify, and innovate in Mexico!

Ready, Set, Go Mexico! [ return to top ]