Publication Date: April 15 2016
Subject Matter: Non-Organic Growth - Smart Decisions
Calgary, AB, Canada – CAPEX-WORLD Corp ("CAPEX") announced today that it has successfully completed a friendly take-over of an 8-year-old consulting business including but not limited to due-diligence, feasibility studies, risk, performance and compatibility assessments. Because of reasons not disclosed herein CAPEX declined one of the Canadian clients (the “Client”) that was previously serviced by the previous consulting company and now the Standard Consulting Agreement with this Client is terminated.
We value the expertise of the advisors of the former company and are pleased that they will continue as Capex’s advisors (“Capex Advisors”). Their experience includes advising to develop an approximate MEX $200,000,000.00 Eco-gated Community (the “Community”). Such Community is on a 13,000 square meter tropical lot in Playa del Carmen, Quintana Roo, Mexico, which is in the heart of the Riviera Maya, and a globally recognized key destination as well as one of the fastest growing cities in Latin America for many years.
This almost finished Community consists of 7 prototypes across 50 residencies with approximately 11,000 plants and trees and almost one kilometer of water canals and pools. This Community is now a home, a vacation destination and or investment property to 42 Canadian and or Mexican owners who have purchased 84% of the project. Depending on the status of the contracts, most of these buyers have obtained a free and clear title on their properties and this Community is currently operated by the Home Owners Association (the “HOA”).
In this Community prices rose from US $1,000.00 to more than US $2,000.00 per net square meter subsequent to the maturity of the project and the area which in less than 4 years is one of the most sought after locations due to the accessibility, urban planning and amenities which were not available prior to the construction. Accordingly, prices of land in this area rose from approximately US $80.00 to US $250.00 per square meter for undeveloped macro lots. Other contributing factors were the depreciation of the Peso against the US Dollar i.e. from MEX $11.00 to todays MEX $17.00 and the appreciation of the US Dollar against the Canadian Dollar i.e. par to CAD $1.30. Most of the construction was paid in Mexican Pesos, sales made in US Dollars, the majority of the equity investments were performed in Canadian Dollars and the institutional finance was secured in Mexican Pesos.
The growing number of developers that learned about this Community and attempted to utilize similar practices in their planning and in particular the creative master plan, state of the art technologies, preservation, cost effectiveness and carbon dioxide reducing methods are only some of the indicators that this Community has become a benchmark for future developments and evidently was a trigger that accelerated this area’s growth, quality and exclusivity. Features such as water heating and electricity production from the sun, Ozone based cleaning water system, smart access points, domestic vegetation and trees to minimize water consumption and free of traffic zones are only some of the ideas that are utilized to minimize maintenance cost, ecological contamination and achieve enhanced privacy.
CAPEX’s Advisors took a lead position in this endeavor by assisting the Client to determine and execute its business plan, to obtain a substantial line of credit from Scotiabank, to obtain tax advice, accounting and reporting from PricewaterhouseCoopers. Additionally, the Advisor’s assistance enabled the Client to work with domestic prestigious law firms, for the domestic operation to equity-partner with an experienced and extremely well connected domestic developer in Mexico, to implement high practices of corporate governance, to adjust strategies, business models and policies to protect this Client from events such as the H1N1 pandemic, global recession, the industry crisis in Mexico, changes in finance to foreigners and other difficulties that were beyond the Advisors’ control and are not disclosed herein due to confidentiality.
This endeavor provided work for up to 400 families over 3 years, established the direction the industry needs to aim, reduced the human footprint and at the same time enabled our Advisors to learn a priceless lesson on human and institutional behavior. More importantly, we have established friendly and professional relationships with the vast majority of the parties that are and or were involved with this endeavor, which we already carry forward to other independent business opportunities.
With respect to our future participation as independent advisors, we will exercise our best effort to assist those individuals that obey the law, ethical code, written agreements and want to do what is right based on equitable principles to complete their business with this Client at the earliest possible moment.
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for and on behalf of
CAPEX-WORLD CORP.
Daniel Portnoy
President & CEO
Calgary, AB Canada
