September 23, 2023

Valores Simesa Trims Net Loss in 2022 Versus 2021

Medellin-based real estate developer Valores Simesa – owner of the “Ciudad del Rio” properties here on lands once occupied by a long-since-demolished iron foundry – announced March 15 a COP$778 million (US$160,000) net loss for full-year 2022, an improvement over the COP$4.56 billion (US$936,000) net loss in 2021.

Financial investments explain the big improvement, netting COP$6.9 billion (US$1.4 million) in 2022 versus COP$3.7 billion (US$759,000) in 2021.

The 2022 losses are “mainly explained by the lower value of [certain] properties located in Ciudad Del Río, partially offset by interest income derived from negotiations of the lots sold and the yields of the investment portfolio,” according to the company.

Valores Simesa also cited “low demand for non-residential real estate, an increase in construction costs above rental values, and the increase in builder loan-interest rates.”

Despite posting a net loss for the year, “2022 was a favorable year to continue consolidating the company’s strategy, which was affected in previous years by impact of the pandemic on the real estate sector,” the company added.

Meanwhile, Valores Simesa cites two promising real-estate projects in the works.

One is a US$23 million, multifamily rental-housing project from Hasta Capital, aiming to create about 300 residential units.

“The second project involves Conaltura, a developer with a long history that arrives for the first time in Ciudad Del Río with the construction of a housing tower for sale involving approximately 228 apartments. Both projects involve an attractive commercial first floor,” according to Valores.

“The agreed price for this lot was COP$34 billion [US$6.98 million], of which at the end of the year COP$15.28 billion [US$3.1 million) remains to be paid, to be collected in four semi-annual installments of COP$3.8 billion [US$781,000], according to the company.

Meanwhile, another project “currently being carried out with the municipality of Medellín could make three available lots of Valores Simesa more flexible — allowing these properties to be in greater demand and in-tune with the trend towards the development of mixed-use projects that diversify the risks associated with vacancies of different segments and generate greater connectivity between population densities and the business centers of the cities,” the company added.

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