Mexico's Geo to keep buying land despite crisis

MONTERREY, Mexico, Feb 27 (Reuters) - Geo, one of Mexico's leading homebuilders, said on Friday it will maintain its plans to invest in land this year, despite a steep economic slump, and is looking to refinance its short-term debt.

Company officials said they plan to invest up to 2.1 billion pesos ($139 million) this year to buy land, compared with 2.2 billion pesos last year, in order to keep sufficient inventory for four or five years of house construction.

After years of explosive growth, Mexico's housing industry is expected to expand less in 2009 as the economy slows.

Builders like Homex (HOMEX.MX)(HXM.N) and Urbi (URBI.MX) have also said they will buy less land this year to reduce spending and shore up liquidity.

Geo (GEOB.MX) reported a 15 percent decline in fourth-quarter net profit on Thursday but reaffirmed its outlook that 2009 revenue would increase as much as 10 percent.

Geo financial chief Saul Escarpulli told analysts during a conference call that the company was talking to banks about extending maturities on its short-term debt, including a $30 million bond due in May.

"We feel comfortable with our debt structure, but we're still working with the banks in order to get more time for maturities," Escarpulli said, adding the company has significant cash to meet its obligations.

Mexico's economy is expected to shrink this year, but the country's banks and government mortgage lender Infonavit are well capitalized and in good shape compared with U.S. lenders.

($1 = 15.09 pesos) (Reporting by Gabriela Lopez; Editing by Gary Hill)