The Spanish tactician was approached by the Reds at the end of last season after they sacked Kenny Dalglish but he turned down the overtures to focus on what he started with owner and chairman Dave Whelan at the DW Stadium back in 2009.
"I had an agreement of three years with my chairman, who has been loyal and supportive. I had the opportunity to pay back that loyalty after my second season here. The third year was the time to think what it was he wanted to do," he told the Independent.
"I wanted certain things done internally for me to stay. That meant investing in a new training ground, which we are 12 months away from. It meant investing in the structure of the Under-21s and trying to keep the players we wanted to keep.
"It took the chairman a week or two to think about it. Then, he was as excited as I have ever seen him."
He added: "I like to build a football club. I did at Swansea and there is a pleasure in seeing football clubs three or four years down the line even when you are not involved.
"Having been in the Premier League for eight years, Wigan have not got enough to show for it. The summer was a key moment to do that and the chairman agreed to have a legacy to leave behind."