Mexico's Vinte - Affordable and Sustainable Housing for BOP Customers
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Case Code: BSTR460 Case Length: 15 Pages Period: 2000-2014 Pub Date: 2014 Teaching Note: Not Available |
Price: Rs.400 Organization: VINTE Viviendas Integrales, S.A. de C.V. Industry: Construction Industry Countries: Mexico Themes: Business Strategy,Social Entrepreneurship |
Abstract Case Intro 1 Case Intro 2 Excerpts
Excerpts
Unique Features Of Vinte Homes
VINTE began its housing projects in Central Mexico. It targeted Central Mexican regions with acute shortage of affordable housing options. In 2003, the company completed and offered its first home in the housing complex, 'Real del Sol', in Tecámac, State of Mexico.
VINTE’s homes started at US$ 27,500. It offered houses in three segments within which again, there were several options. All these homes were offered in each housing project and the price of each of the different types of houses varied by about Mex$ 9 150,000 (US$ 11,000)...
Vinte's Management Systems
VINTE was a vertically integrated company with a presence in the entire value chain in the real estate market. This included activities such as land acquisition, housing design, housing development planning, construction, marketing, sales and after-sales service.
VINTE offered custom made furniture with a consideration for ergonomics for the home at low prices. Home owners could use the furniture to furnish their homes as soon as they were ready to occupy them. In times of need, VINTE offered homeowners the option of selling their homes back to the company in case they needed money for their requirements...
External Support for Vinte
One of the key reasons VINTE was able to successfully sell its homes was the Mexican government's initiatives to provide housing finance to working class people. The Mexican government provided subsidies to support housing projects aimed at the BOP. The amount of subsidy was mostly equal to the down payment required by developers to immediately transfer possession to the purchaser. The government increased these subsidies in case a family purchased a house that contributed to sustainability by having solar panels, water conservation systems, and Internet access through computers....
Financial Support For Vinte
VINTE received financial support from several leading global financial institutions, which helped the company to not only meet its working capital needs, but also to raise additional funds. Over the years, there had been a gradual rise in consolidation among midsize players in the Mexican housing market. As of 2012, 35% of all housing projects were provided by the five largest construction companies of Mexico (it was 17% in 2005). The rest of the market comprised small and mid-size players that generally struggled to gain access to medium and long term finance for their working capital...
Recognition
As of 2012, VINTE was the 19th largest builder in Mexico and had built more than 15,000 homes during its decade of existence in four Mexican states in the Midwest region – Mexico, Querétaro, Hidalgo, and Quintana Roo. As of 2013, the company had a land bank of 411 acres. Based on the number of homes sold between 2008 and 2013, VINTE had a compounded annual growth rate (CAGR) of 22.4%...
Outlook
The company had a research and development (R&D) laboratory called 'Vintelligence'. It strove to develop new sustainable building materials and sought to apply new technologies in house construction. The company had plans to increase R&D investments in future and to incorporate new technologies such as nano-structured construction materials and green technologies into its projects. Leal said, “Vinte will continue anticipating the conveniences people will need in the short term, with a view to holding on to its position as the leading company in the sector in terms of innovation."...
Exhibits
Exhibit I: Information on Affordable and Sustainable Housing In Mexico
Exhibit II: Location of Vinte's Various Housing Projects
Exhibit III:Awards Won by Vinte
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