Private investment funds have US$4.5 billion to invest in Colombia

RIO DE JANEIRO, BRAZIL – Private investment funds operating in Colombia have some US$4.5 billion to invest, though the coronavirus has battered opportunities and changed risk perceptions of investments previously considered safe, the head of the private investment trade association said on Wednesday April 14.

Assets previously considered safe – like investments in high-end office real estate in Bogota’s financial district or retail sites – have suffered amid the pandemic and many are now empty, said Paula Delgadillo from the Colcapital trade association.

But investors are now more willing to put money into start-ups and technology companies, she said.

“This pandemic made those of us within private capital rethink and look at which perceptions needed to be re-examined,” she told Reuters by phone.

“Within private capital, entrepreneur capital was perceived as the most volatile and most risky and what ended up happening was we saw some start-ups with the capacity to adapt their business models very quickly, which allowed the majority to take advantage of the situation,” Delgadillo said.

There are also opportunities in infrastructure projects and social housing, which will be key to pandemic recovery in regional economies including Colombia, she said.

“Sectors like consumption, retail, commercial were hit badly and changes in consumer habits make you rethink,” she said.

Some 165 private investment funds have invested about US$18 billion in Colombia.

“In general for Pacific Alliance countries the time is coming where we can expect an economic recovery and there we have very important value generation potential and also an important capacity for generating employment and strengthening business connections between the countries,” Delgadillo said, referring to the trade bloc that includes Colombia, Chile, Mexico and Peru.