What is securitization?
Securitization is a process carried out exclusively by a specialized institution, such as Fortesec, authorized by the competent regulatory bodies, which coordinates and structures the issuance of a security backed by credit rights, real estate or agricultural credit, for example, which will be traded on the Capital Market and acquired by investors.
HOW IS THIS OPERATION STRUCTURED?
The assembling of securitization takes into account, among other variables, for its success, the following aspects:
Feasibility
of the project
Feasibility of the project
Ability to pay
Risk of Completion
Entrepreneur Credit Analysis
Feasibility of the project
Ability to pay
Risk of Completion
Entrepreneur Credit Analysis
TYPES OF OPERATIONS SERVED
Land Subdivisions
Backed by receivables from land subdivisions under construction or already delivered.
Resorts
Backed by receivables from fractional resort sales or the sale of timeshare usage rights, during construction or once the development is completed.
Shopping malls
Backed by rental income and parking revenue for shopping malls under construction, expansion, or already completed.
Real estate developments
Backed by receivables from apartments and commercial units under construction or after the occupancy permit ("Habite-se").
Corporate
Sale & Lease Back and Built-to-Suit transactions.
Rentals
Backed by receivables from the rental of completed properties.
Machinery and parts
Backed by receivables from the purchase and sale of agricultural machinery and equipment.
Pesticides and fertilizers
Backed by credit rights arising from the purchase and sale of chemicals used in agricultural production.
Crop and livestock production
Backed by breeding, production, processing, or inventory related to agricultural activity.
Energy and forestry production
Backed by receivables from the sale of energy and timber.
HOW DOES THIS ACTUALLY WORK?
HOW DOES THIS
ACTUALLY WORK?
Securitization was born as an alternative to the more traditional lines, by meeting the specific needs of each borrower, the flows of its project, and because it seeks source of non-bank resources, since the receivables are transformed into securities destined to investors.
HOW ARE THESE FUNDS RAISED?
HOW ARE THESE FUNDS RAISED?
The securities are sold on the capital markets as fixed-income instruments to investors, such as individuals and investment funds. The funds raised from investors are used to finance the project and, in return, investors receive part of the payments from the financed project.
FORTESEC turns issuances into securities, called Real Estate or Agribusiness Receivables Certificates – CRIs or CRAs, which are sold on the capital markets as fixed-income instruments to investors – individuals and investment funds.
The funds raised from investors are used to finance the project, under FORTESEC's supervision and control.
In return, investors receive part of the payments from the financed project.
WHERE DOES FORTESEC FIT INTO THIS PROCESS?
WHERE DOES FORTESEC FIT INTO THIS PROCESS?
WHAT IS THE ADVANTAGE OF WORKING WITH A SECURITIZATION COMPANY?
For the investor, the main advantage is receiving monthly interest on the investment made; for the developer, it's being able to raise cash upfront and make their operation viable.
FORTESEC is committed to understanding the real needs of the projects it finances and guiding every stage of structuring the operation, from making funds available through to full repayment to investors.
That's why FORTESEC is the right partner for raising capital!
Contact Us
Are you interested in securitization processes, need answers or need to speak to us?
Back to top