Home, Sweet Worker.

A U.S.-Mexico joint venture that builds homes for maquiladora workers is reducing turnover--and improving morale.

THREE YEARS AGO, 24-YEAR-OLD ROSI LOYA WAS WORKING AT a maquiladora, or in-bond assembly plant, in Ciudad Juarez, Mexico. She was living with relatives, but really wanted to find a place of her own. So when she heard about a home-buying program offered through her employer, Delhi Automotive Systems Inc., she jumped at it.

After saving 8% of her salary for a year for the down payment, she moved into her new two-bedroom home two years ago. Her house is so nice, her parents have even moved in with her. "It was a great help," she says. "I don't think I would have been able to buy it by myself."

Loya is not alone. The proliferation of maquiladoras--3,000 at last count--has led to a severe housing shortage in the northern part of Mexico. As a result, many workers lured there by steady, decently paying jobs have been forced to live with relatives, share rental houses with other workers or--worse--subsist in makeshift houses.

These conditions haven't exactly helped the productivity or morale of maquiladora workers. They also haven't made them stay put: Nine out of 10 workers quit their jobs every year along the border. So to keep their workers happy, healthy and working at their plant, a few employers are helping them to become homeowners.

This good will comes at a time when some plant operators are being maligned for their treatment of workers. Last August, New York City-based textile company Salant Corp. agreed to pay US$30 million in damages to the families of 14 maquiladora workers who were killed when a company bus overturned in a sewage ditch and caught fire en route to its plant in Valley Hermosa, Tamaulipas. Attorneys for the workers claimed the bus was unsafe.

The idea behind building homes for workers came from David Arelle Sergent, the 51-year-old owner and president of Grupo Condak, a home builder based in Juarez. After the 1994 peso devaluation, home building came to a standstill because of escalating unemployment and three-figure interest rates. Yet he saw factories popping up all around him but no way to house all the workers that were flocking to them for jobs. "The cities along the border grew so fast," he says. "But we had big infrastructure problems."

Arelle took his idea to William Crombie, an executive with Detroit-based Pulte Corp., the largest homebuilder in the United States. Crombie was very receptive to the idea of building homes for a ready-made market. So in October of 1995, the two signed an agreement to build homes in northern Mexico--including some targeting maquiladora workers.

Delphi bites. At the same time, Delphi--then owned by Detroit-based automotive giant General Motors--was looking for a way to deal with the housing shortage for its workers and had asked Mexican housing agency Infonavit for help. "Our plants in Mexico are world-class. We wanted world-class living conditions [for our workers] as well," says Lee Crawford, Delphi's El Paso-based director of Mexican operations.

Condak-Pulte found out Delphi was interested, so it made a presentation. In June 1996, Delphi bit, committing to 2,000 homes for the next year. The joint venture has since built 2,000 for company workers in seven cities around northern Mexico and is committed to building 800 more. But even that's not enough: Delphi recently signed a deal with Condak-Pulte for another 2,200 homes over the next three years.

Two other maquiladora operators have since signed up. Two years ago, Japanese electronics maker Sony asked Condak-Pulte to build 500 homes for its workers in Nuevo Laredo. Half of them have already been delivered, and another 250 are in the works. And at the end of last year, Vishay Vale Electronics committed to 600 homes for its workers in Juarez.

By U.S. standards, these houses aren't fancy-or large. The concrete homes average 775 to 1,291 square feet with anywhere from one to two and a half bedrooms and one bathroom. But each comes equipped with electricity, running water, sewage and phone lines and is expandable, either upward or outward. And as in the United States, each subdivision features landscaping, streets and sidewalks. Some even come with parks, community centers and shopping centers. In Juarez, Condak-Pulte worked with the state to put in a hospital and three schools as well. "You're really selling a community, not a house," Pulte's Crombie says.

It may sound easy, but it isn't. Other Mexican homebuilders have looked at setting up similar programs for maquiladoras, but haven't gotten past the planning stage. One company, Sinaloa-based Pycsa, made a stab at it a few years ago but got bogged down in the details.

And the details are many. First, you have to find maquiladoras that are willing to match their employees' contributions for the 20% down payment. It's a necessity: These houses sell for between $13,000 and $15,000, and many maquila workers make only between $3,000 and $5,000 a year. So far, Delphi has coughed up $10 million, its workers $5 million.

Then there's the screening process. Delphi, for example, started with a computer printout of 30,000 workers. After it whittled that down to 13,000 it was willing to support, Condak-Pulte broke the list up into groups of 50, meeting with them to explain the program. For those 7,800 who were interested, Condak-Pulte helped them fill out the paperwork to apply for low-cost mortgages through Infonavit's Binomio Ahorro Hogar program. They also helped them track down the necessary documents, such as birth and marriage certificates, credit reports and proof of earnings from their employer--not something a U.S. homebuilder typically would do.

Now that it's completed programs for Delphi, Sony and Vishay, Condak-Pulte wants to do more. It's currently talking to maquilas as far away as Tijuana to see if they'd be interested. It has some impressive results to show: Among the 1,000 workers who acquired homes through the Delphi program 18 months ago, there's only been a 3.5% turnover. And defaults have been rare. "It's really paid off in the end," Delphi's Crawford says.

It's certainly paid off for Javier Ochoa, a 33-year-old production operator who's worked at Delphi for four years. Two years ago, he was living in a rundown rental house in a colonia with his wife and six-year-old son. After a year of saving, he was able to move into his house a year ago. "1 wanted to have a better future," he says. "My [house] is much more comfortable, much more secure." Not many maquiladora workers can say that.