IDB Invest, Ruba Join Forces to Promote Access to Affordable Housing in Mexico
IDB Invest is providing MXN1.5 billion worth of financing for Inmobiliaria Ruba, S.A. of C.V. (Ruba), a leading housing developer in Mexico, to finance the development of low-income and middle-income housing in the country.
The deal consists of a comprehensive financing solution involving an advance payment line for accounts payable to suppliers (reverse factoring) for Ruba's suppliers, mostly micro, small and medium-sized construction companies (MSMEs), for MXN500 million, or its equivalent in US dollars, and a seven-year revolving line of credit for MXN1,000 million that includes a committed tranche of MXN500 million and an uncommitted tranche of MXN500 million.
Mexico currently has a housing lag estimated at 8.5 million homes, mainly in the lower-income segments, according to 2021 estimates by the National Housing Commission. The country had around 4.5 million MSMEs, which contribute about 42% of Mexico's Gross Domestic Product (GDP) and generate 78% of formal employment.
With this transaction, IDB Invest and Ruba will work together to promote access to financing for adequate and affordable housing in Mexico. Likewise, IDB Invest will support Ruba in the implementation of improvements in its environmental and social plan to strengthen its sustainability strategy. Ruba will strengthen its supply chains and increase access to short-term financing for MSME suppliers under more favorable conditions.
Additionally, this operation is expected to contribute to five United Nations Sustainable Development Goals (SDGs): End of poverty (SDG 1), Decent work and economic growth (SDG 8), Industry, innovation and infrastructure ( SDG 9), Sustainable Cities and Communities (SDG 11), and Responsible Consumption and Production (SDG 12).
About IDB Invest
IDB Invest, a member of the IDB Group, is a multilateral development bank committed to promoting the economic development of its member countries in Latin America and the Caribbean through the private sector. IDB Invest finances sustainable companies and projects to achieve financial results and maximize economic, social, and environmental development in the region. With a portfolio of $14.1 billion in asset management and 325 clients in 25 countries, IDB Invest provides innovative financial solutions and advisory services that meet the needs of its clients in a variety of industries.
Ruba is dedicated to the acquisition, development and commercialization of housing projects. It is headquartered in Ciudad Juárez, Chihuahua, and is currently considered one of the 2 most important housing developers in the country, with 42 years of experience, a period in which It has deeded more than 225,000 homes, operates in 16 places located in 12 states of the Mexican Republic. It has 1,342 employees. From 2004 to date, Ruba has placed five issues of long-term stock certificates through the BMV and has the highest credit quality ratings in the industry, AA (-) with a stable outlook by S&P Global Ratings and Fitch Ratings. Since 2019, Ruba has had the Socially Responsible Company Distinction (ESR) and for 18 years has participated in the work environment survey organized by the Great Place to Work (GPTW), where, in 2021, Ruba secured 6th place within the ranking of 'The Best Companies to Work for in Mexico 2022 For All', in the category of 500 to 5,000 employees.