Architect hopes to rehabilitate downtown Lima with affordable office rent

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What made you invest in downtown Lima?
We started with a visit in 2004. I stayed in a small hotel in Jirón Azángaro, where only two or three rooms had bathrooms. Then, I went to the Bolivar hotel, where I lived for over a year and developed the plan to invest in downtown Lima. I started to invested in 2005. The team started to take shape around the architect Luciana Soldi in June 2005.

How many buildings did you start your investment with?
In 2005, we located the first eight buildings. We invested the first sum of money and had to ask the sellers to finance us. During the first couple of years, our objective was to pay for the buildings and prepare the rehabilitation projects.

But you then acquired more buildings?
In 2009 we bought one more building and before this year is over we will buy two more.

Which are they?
I cannot tell you because that could be counterproductive. Speaking in terms of square meters, we currently own 42,000 square meters and with these new acquisitions, we will reach 70,000 by the end of the year.

Who has rented your offices?
We started to attract companies such as the Caja de Arequipa, Ipsos Apoyo and the broker Solfin. They are not the tenants that used to be here.

And how many tenants of that level have you brought to downtown Lima?
We have three groups of tenants: state administration, like Sunat. The country is doing well and the state needs more offices.

Is the state a good payer?
It is. We are very happy with them and I think that they are happy with us too. Another group is what we call “other clients” and something we consider a success is having brought the number one bank in the world: HSBC. We brought it to Peru and to downtown Lima with three buildings. Then, we have a third group that is the most important and is called BPO (Business Process Outsourcing).

Who are they?
Companies like Telefonica or Endesa do not want to have their commercial departments inside the enterprise because it ends up being too expensive, so they hire someone outside the country. This is our main customer package and we are bringing these companies. We have been to Argentina to bring contact centers, call centers and help centers. We have brought companies that have 15,000 employees around the world.

And what do you offer them?
These large companies need a great deal of energy, but they need it cheap since they are big consumers. We give them electricity 35% cheaper than regular electricity at home.

And how have you achieved this?
We buy it as wholesaler from Edelnor; we transform it in the building and sell it to them at lower prices. They are great energy consumers. When we sleep, they work. Through these BPOs, we have created 6,500 jobs here and in downtown Lima.

Are these companies happy downtown?
They are. Firstly, because we give them technology, then, transformation stations and also, generators. When Edelnor cuts the power, these people cannot stop because their clients penalize them for it. We have generators that start operating immediately and the building keeps running. Other buildings don’t offer that.

How much have you invested?
A lot of money.

How much are you charging?
The rent is between US $7.50 and $8.50 per square meter.

Isn’t that very cheap?
It is cheap compared to the investment we have made. We also tell them to come to Peru for various reasons. Firstly, I will charge them less than in Santiago, Buenos Aires or Madrid. Also, because the people that they can hire here have a very good professional formation and speak better Spanish than they do in Argentina or Chile and that is interesting to them. In addition, their employees will be able to come to downtown Lima using the new system of gas powered buses that the Lima Municipality is about to inaugurate.

With your rates, your profit margin is going to be very small…
Clearly. We are trying to get financing from banks and we are starting to get it. We have to work very hard. We are marathon runners. We do no sprint, we run long distances — we are prepared for profitability in the long and medium term, not in the short term. We are recovering the center of the city, rehabilitating buildings, respecting history…

What are your long term projects?
The conversion of the Rimac River bed (near the Plaza de Armas) into an urban area, with roads, parks and 5,000 houses. Instead of having the river made into a dump, we must recover it. We are also talking with the municipality to build an underground parking lot under the Plaza San Martin.

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