HSC was established in 1994 and is currently Mexico’s second largest Sofol, with a share of about 20% of the market held by housing Sofols. HSC is owned by its senior management, Pulte Mortgage Corporation (the second-largest U.S. homebuilder) and other Mexican homebuilders (including GEO, one of Mexico’s largest homebuilders) and IFC. The company’s primary business is the origination and servicing of residential mortgage and construction loans. HSC’s asset base and net worth at year-end 2002 stood at $1.3 billion and $93 million, respectively. Mortgage loans accounted for about 80% of HSC’s loan portfolio while bridge loans ($246 million equivalent at year-end 2002) accounted for 20% of the loan portfolio.

Total project cost is estimated at about $30 million equivalent. IFC’s investment consists of a secured loan of up to MXN180 million for IFC’s own account.

16.47 million (USD)

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	16.47
Equity

* These investment figures are indicative

HSC is headquartered in Mexico City and has 34 branches and 68 collection offices covering 28 states and 55 cities in Mexico.

This is an FI Type 1 project. As part of a previous investment by IFC, Su Casita established an environmental management system as required by IFC. For the proposed new investment by IFC, Su Casita will be required to confirm that its current method of managing environmental and social effects of its activities will remain in place. In addition, IFC will assess the effectiveness of Su Casita’s present environmental management system.
Location of environmental documents in locally affected community

Mexico faces a large housing deficit estimated at about 4 million units. The lack of available funding for the construction of new homes is a principle obstacle to reducing the country's housing deficit. SHF’s discontinuation of loans to Sofols for bridge loans to developers, has aggravated this problem. IFC’s proposed investment directly addresses this obstacle. Further on, IFC considers this investment to be consistent with its overall strategy which underlies its relationship with HSC. Housing finance contributes to social stability by enabling households to purchase an asset which will represent their largest single investment. This is enhanced further in the case of low-income households. This project is different to other IFC projects in housing finance, as it addresses supply side, rather than demand related issues. By financing bridge loans, this project will address the housing deficit on the supply side, which will in turn enable households to access home ownership, through the existing housing finance channels. Housing markets have significant economic linkages as housing construction and housing related sectors represent approximately 9% of the labor force worldwide. The linkages include land markets, building materials, tools, durable goods and labor markets. This project will enable job creation in the housing and construction sectors.