Creating and building everything from malls to universities to large corporate offices isn’t just about finding the proper piece of land and the right construction team. There are myriad details that can make or break a project, causing it to come in over or under budget, on time or delayed.
This is true no matter the region or market—but is perhaps especially so in Latin America.
For clients looking to build out a project in Latin America—whether as a first-timer or a veteran in the region—it is critical to account for all of those important details to help reduce the risk in setting up shop in a new market or expanding existing operations.
There are myriad details that could make or break a project, causing it to come in over or under budget, on time or delayed.
This is where the project manager can serve as a critical member of the larger project team.
“The service of the project manager is to run a clients’ projects and to help with aspects of the project that can get complicated, like exchange rates, local currencies and foreign languages,” says Sergio Panero, a senior managing director of project management for Latin America at CBRE.
“For our clients, we run projects from start to finish—beginning with finding the right building or office space, coordinating technical inspections and bidding prospects for an architectural firm, all the way through to overseeing construction, sourcing the furniture and finally, coordinating with a moving company.”
In 2015 alone, nearly $273 billion in goods were exported from the United States to Latin American markets, according to the International Trade Administration, reinforcing that now is a prime time for the U.S. and other international businesses to set up shop in the region.
Panero’s experience confirms this growing trend: “We are mostly dealing with American companies; around 80 percent of our clients are global accounts from the U.S.”
So when those companies—including everything from large multinational telecom companies to global financial institutions—come to Panero and his regional teams for project management expertise, what exactly are they looking for?
“Normally, we don’t have clients that come to us with detailed plans. We have clients that come with an idea and a completion date or move-in date,” says Jaime Viejo, managing director of Mexico’s project management team at CBRE.
“Where we add the most value is in guiding the client through the planning and design phase. We create three or four different options and solutions for them to choose from, each with different savings and schedules.”
From there, the client chooses how they’d like to proceed, and it’s up to the project management team to guide them toward the most efficient, cost-effective and value-friendly option.
Where we add the most value is in guiding the client through the planning and design phase.
“Our expertise comes out in the design process: We see things that the architect or the engineers don’t necessarily see, often enabling us to recommend more cost-effective solutions beyond the initial proposals [from the architects or engineers],” Viejo explains.
Indeed, undergoing a design process in Latin America has a bit of a learning curve for international businesses looking to set up a new office. Not only are there different permit rules, there are also import and export costs that can quickly stack up.
“Budgeting is important because our international clients are used to giving a budget per square foot, but there are some countries where building is really expensive and others where it’s very affordable,” Panero says. “Also, exporting and importing furniture is a huge cost. So we’ll often suggest partnering with select local manufacturers to reduce cost while maintaining quality.”
With a project manager’s help, Viejo estimates that clients typically save around 10 percent off the top of their budget—in one instance, the team helped a client in Mexico City save over $1 million USD thanks to local expertise in competitive construction bidding and furniture suppliers.
As global expansion continues across industries, money and time saved can translate into additional resources that can be put toward future offices in the next up-and-coming market.