A new towerco with aspirations across CALA

Balesia is the only towerco TowerXchange has tracked so far with existing or planned operations throughout the CALA region, from Puerto Rico all the way to Argentina. Its CEO, Mario Rafael Álvarez Gutierrez is an architect who specialised in a new, niche sector such as the telecom tower industry in the United States. In this interview, he shares with us his background as well as the rationale behind the creation of Balesia and his plans for the company’s expansion across South America.

TowerXchange: Please introduce yourself and your career in the tower business.

I am an architect by training, having graduated in the United States with a degree in architecture and a minor in business. After college, I immediately launched my firm thanks to the help of my father, Mario Rafael Álvarez, a civil engineer from Cuba.

My first client was the Los Angeles Cellular Company back in 1987. At the time, the company was owned by the McCaw brothers, who pioneered the cellular industry and founded companies such as McCaw Cellular (now part of AT&T Mobility) and Clearwire Corporation. Among my other clients, I designed and built towers for LA Cellular (now AT&T) and this is how I started working in the telecom sector. At the peak of my activity, I was a licensed architect in over forty-five states in the United States and also in Puerto Rico!

The firm was called Alvar Architects, Engineers and Builders and then changed its name to Velocitel LLC. Over a period of around fifteen years, we designed and/or built close to 35,000 sites for all major U.S. and Puerto Rican carriers. In 1999, I sold 70% of Velocitel to Willis Stein and Partners and became, along with my family, a private shareholder of approximately 30% of the business. Around 2001, I retired from the business and to date I still own around 20% of the company’s stock.

In 2013, I started Balesia Towers with the goal and vision to once more build towers but concentrating mainly on Latin America. Balesia’s corporate office is in Madrid and we have a regional office in Lima, Peru although I am mostly based in the United States.

TowerXchange: What is Balesia’s geographical footprint? What is the pedigree of your management team? Does Balesia focus on Build-to-Suit (BTS) only or is looking at acquiring portfolios as well?

Balesia is present in Peru, Ecuador, Guatemala, Colombia, Nicaragua, Costa Rica, El Salvador, Honduras, and Chile. And we are in the process of starting offices in Argentina, Bolivia, Paraguay, Uruguay, Dominican Republic, Puerto Rico, Brazil, Panamá, Haiti and the Caribbean.

Our personnel holds a combined 150-year experience in the sector and we have a very strong family culture within the company. We work extremely hard, striving to provide excellent customer service while making sure we take care of the team.

We focus on BTS but also look at potential portfolio acquisitions.

TowerXchange: What are the key challenges of operating in the Build-to-Suit market right now?

The number one challenge we are facing today is the increased competition among tower builders. Other details are all very manageable!

TowerXchange: Why have you chosen to invest in your particular target tower markets?

The rationale is very simple… With the deployment of 4G LTE, the demand for new towers in Latin America is going to be overwhelming for the next five years.

TowerXchange: Please tell us the differences of doing business in Peru vs Colombia.

To date, Peru presents a very flexible set of laws that facilitate the installation of new towers. The process is much easier now than it used to be and there’s less competition among tower builders.

On the other hand, Colombia is experiencing a huge wave of competition among tower builders and we find that there are less opportunities for new business with the local carriers.

TowerXchange: And what about Costa Rica, Guatemala and Honduras - how do they compare?

I tend to look at Central America as effectively one country. And this is why we have a few sites in certain countries and many in others… We treat the region as a whole which helps making sure that our local operations make business sense.

TowerXchange: What is your view on Argentina? Are you exploring opportunities in the country? And if so, how do U.S. investors feel about it?

We have just hired our new General Manager in Argentina and are anxious to start building sites! And we’ve just received a green light from our banks to start a business in Argentina, as long as our contracts with carriers are stipulated in U.S. Dollars.

TowerXchange: Please summarise your vision for the future of your company.

My vision is the same that I had back in 1987. Back then, I wanted to build a large tower portfolio and hold on to it, full stop. But I wasn’t able to succeed at Velocitel since Willis Stein and I didn’t share a common vision and strategy.

Now I have the resources and partners to make sure I realise my dream and I am very excited about the future of Balesia Towers.