Eduardo Costantini on Argentina

Courtesy of Malba - Fundación Costantini

The country has great metrics, but still suffers an image problem.

BUENOS AIRES – He never stopped building in Argentina, in spite of the harsh ups-and-downs of the country’s politics and economy. For Eduardo Costantini, economist, businessman and an avid collector of Latin American art, building is his element. He builds with designs and textures; harmonious and attractive lines as crucial elements, de-monstrated by his functional yet exquisite buildings rising in the city and urban developments in rural areas like Nordelta or Puertos del Lago. It is these “city-towns,” close to the Argentine capital and masterfully integrated into their natural surroundings, that in a few years will house 170,000 residents.
“With economic growth, construction is dynamic and has a multiplier effect,” Costantini tells Latin Trade, referring to Argentina’s growth rates, which have been rising since 2003 and hit a peak of 9.2 percent in 2005 and 2010. “Argentina is in a different position than in previous decades. It has a situation of unusual solvency, low debt and solid assets,” unlike what is being experienced in Europe and the United States.
“There has never been such a low level of debt,” he says, and adds that a snapshot of the Argentine economy shows a solid level of assets never before seen, which contrasts greatly to 2000, when the country “was trapped by its foreign debt.”
From his office at the Museum of Latin American Art – which he himself built and which houses part of his exquisite collection of paintings – the businessman compares the situation that Argentina was in a little more than 10 years ago to its current one, and he believes that abroad there persists a perception of risk about the country that is not based on reality. Similarly, he feels that the low level of foreign investment is due to “a kind of bad image” that arises from not having finished paying the foreign debt and for having an economic policy that is heterodox, but “not necessarily as bad as foreign investors see it.”
Costantini can’t understand how sophisticated institutional investors that buy debt bonds can compare Argentina’s debt to that of countries like Italy, a member of the European Union that has a serious solvency problem, a high unemployment rate and is struggling to make good on its foreign obligations. Argentina “projects a fear that is – in my opinion – unjustified,” he adds. But he believes that it is this perception of risk that makes foreign investors “sometimes choose Colombia, Peru or Brazil, which is the great absorber of direct investment.”
Costantini recognizes certain vulnerabilities in the country but does not consider them insurmountable, and thinks that this perception of risk that foreign investors have can be changed with a few key actions. For example, settling accounts with the Paris Club, to which Argentina owes $9 billion; resolving the situation with bond holders that did not participate in the two invitations from the Argentine government to restructure the debt (the so-called “holdouts”), and, in the macroeconomic area, reducing inflation and continuing to work to strengthen tax accounts.
And he adds that Argentina has the luxury of paying its debt without refinancing.
Still, investors must work within the country’s current business climate. He cites the increase of “higher than desirable” costs and the lack of medium and long-term financing, both for companies and for families seeking better access to housing. For that, he estimates that correcting this erroneous perception of risk that the country creates among international investors could produce a flow of foreign investment in the tens of billions of dollars because “there is no dramatic problem with investing in Argentina or for an investor to find quality conditions and the human resources to work here.”
The businessman – who also has projects in Uruguay and Miami – believes that Argentina offers several potential growth areas for foreign investment, among them mining, oil production, and agribusiness with its associated biofuel production. He considers the country behind in its mining development and sees a strong future for business in the energy sector. He estimates that there is ample space to provide added value to raw materials that are marketed and exported today.
And he has also not left the tourism industry, an attractive, underexploited sector with significant growth potential, out of his analysis.
Costantini believes that companies are inexpensive in today’s world and his suggestion to a potential investor landing in Argentina with $200 million or $300 million is to associate with a local group. He or she should also begin by talking with local banks that will screen companies and research specific areas of interest.


Consultatio, the company founded and run by Eduardo Costantini, has projects underway both in the country and abroad. They are few but ambitious: a tower in the Puerto Madero neighborhood of Buenos Aires that will be the country’s largest in terms of office space; a residential tourist complex in Uruguay, another on Miami’s Key Biscayne, and his two “city-towns” of Nordelta and Puertos del Lago, located to the north of Argentina’s capital.
With Nordelta, some 30 kilometers (19 miles) outside Buenos Aires, Costantini developed the concept of integrated urban complexes, meaning suburban areas in an rural environment, with all the services of a city, including education, entertainment and health care.
The scope of the project is overwhelming. It’s developed on 1,600 hectares (3,953 acres) upon which 20 neighborhoods and even a water treatment plant were constructed, and it will be inhabited by 100,000 people when all the owners move in. Construction required the removal of 23 million cubic meters of soil, the installation of 141 kilometers (87 miles) of gas and electrical networks and the construction of 180 hectares (444 acres) worth of artificial lakes, which is what gave Argentina’s first city-town its unique profile.
Just setting up the underpinnings of Nordelta required an infrastructure investment of $350 million and today the pro-ject is a registered trademark of Consultatio and Costantini. In this city that he erected there are four schools providing education to 3,000 students, one health center, as well as movie theaters, banks, gas stations, supermarkets and even a five star hotel, the Nordelta InterContinental. The builder did not leave out sports either. He built an 18-hole golf course designed by Jack Nicklaus, the essential tennis courts and soccer fields, and a marina with a port for sports activities.
“Making a city is diversity in a bundle. Nordelta is an organism. It is a different habitat, different densities between houses and condominiums,” Costantini explains. “It is a rotund project in its totality, it has a political, community aspect because we are creating community.”
Following Nordelta is Puertos del Lago, now in full cons-truction, and future home to 70,000 people. This project is located 44 kilometers (27 miles) outside Buenos Aires, in Escobar, also in the northern zone, and Consultatio has almost 1,400 hectares (3,459 acres) on which to develop a profile similar to the previous one.
But Costantini is not stopping there. Following the office towers and homes and city-towns are real estate developments in relaxation areas. In Uruguay, with its beaches that draw the Argentine public, he is building Las Garzas, a 240 hectares(593 acre) residential tourist center, with almost 500 lots to build on and access to the beaches. And in Key Biscayne, at the door to Miami, lies a residential complex with 165 homes, beach access and all the services that could interest a buyer with high purchasing power.

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