DESTINATION
JUNE 2010 |
www.opp.org.uk
INDUSTRY IN FOCUS Nordeste Invest | 47
In fact, around 30m new hotel rooms will populate both city and coastal towns over the next decade. This includes Pontanegra which only saw its fi rst tall hotels spring up on its beach less than fi ve years ago.
Hotel brands on their way include Hilton, Ritz Carlton, Accor and Ibis, which will launch 55 new hotels in Brazil in time for the World Cup. But UK investors, such as Dominic Seely, co-founder of asset management fi rm Townhouse Capital, said holiday resorts needed to offer more, such as water parks, golf and family entertainment. And not all of this foreign direct investment is focused on the burgeoning tourism industry, which is set to surge when Latin America’s largest airport opens in Natal in 2011. The building of fi rst homes for the domestic population is seen as equally
important, with 3m new social housing homes to be built across Brazil by 2030. This is the backbone of Brazilian president Luiz Inácio Lula da Silva’s policy to get people off the streets and into their own home. The “Minha Vida, Minha Casa” or “My Life, My Home” initiative is for low-income Brazilians, with each household eligible for a government subsidy of up to R$17,000, topped up with a mortgage from the Caixa Economica Federal. The bank is fi nancing the entire Minha Vida, Minha Casa project and it’s hoped that fi nance rates will also fall to 7.5% over the coming years.
Lula – as Brazilians affectionately refer to their Workers’ Party president – has also put increased standards in education and more workers’ rights at the forefront of government actions. To achieve the goal of building more
than 1.5m social housing a year, plus extensive plans for holiday resorts, airports, and R$100bn of rail and road infrastructure, there is a demand for quality labour, says ADIT president Felipe Cavalcante.
Silvio Bezzera, founder of developer Sinduscon and vice president of ADIT, added that the north east is tackling this issue head on. “The civil construction sector and local governments are reacting with new labour training schools – R$3m has already been put towards qualifying 15,000 people to fi nish projects that were started a year ago,” he said.
The transparency of Brazil’s property professionals, who were open about the drawbacks to investors, and then showed what the country is doing to improve its problems, was evident at Nordeste Invest.
CASE STUDY: PALM SPRINGS
This includes the lack of basic infrastructure in smaller suburbs of major cities – including roads, transport links, sewage and water quality. But to some investors this is an opportunity to help Brazil’s developers improve and prepare for the north east’s explosion in real estate.
Brazil: fact-fi le 2030
72 units were sold within 30 days of launching Palm Springs in Muriu
UK developer sells holiday residence to a Brazilian Mayor Developer DLT International is building Palm Springs in Muriu, which is 35 minutes from the current Natal airport but 15 minutes when the new airport is completed. Palm Springs will include 347 land plots for villas in its first phase. DLT
will offer 220 apartments and penthouses in the second phase of the resort, which will sit just 180m from the beach. A four-star hotel and spa is planned for the third phase, which will also
include a clubhouse, street lighting and 2.5m security wall, said DLT sales director Simon Walker. “We bought the land outright and it took two-and-a-half years to get
all the legal licences. Within 30 days of launching Palm Springs we sold 72 units to the domestic population, including a local mayor, a fighter pilot and local lawyers” says Walker, who added that UK investors will have a clear exit strategy and SIPP opportunities to invest. Prices start at £15,000 for a 354sqm land plot, with finished two-bed,
two-bath villas around £80,000. Transaction costs are around 8%. Agents interested in adding Palm Springs to their portfolio can contact Walker on +44 (0)7779 792526.
1. Housing investment is set to expand to R$446.7n from R$165.2bn in 2007.
2. Finance rates for homes are predicted to drop to 7.5%.
3. Population growth is set to be 233m, with 95.5m families.
4. There are 3.1 people per home now – by 2030 this will drop to 2.4.
5. 37m homes will be built. An average of more than 1.6m new family residences per annum.
6. Average increase of 1.74m adequate homes [new and renovated stock.]
7. Real estate aims to rise from 3% to 10% of GDP.
*All figures from the Ernst & Young and the Getulio Vargas Foundation [FGV].
NEWS IN BRIEF ADIT goes nationwide
Cavalcante: North East will be prepared
ADIT, the body which promotes real estate and investment in north east Brazil, is to roll out nationwide. Its annual three-day expo, ADIT Nordest will now be held in three or four more key states every year and be known as Brazil Invest. ADIT president Felipe Cavalcante said: “We need to be part of something bigger.” Its partner APEX, the agency which promotes overall investment in Brazil, is also planning a world tour, starting in Miami and New York, to attract more foreign direct investment to Brazil.
ready’ for World Cup THE NORTH East will be ready for Brazil’s 2014 World Cup, developers told cynics at an ADIT press conference. ADIT president Felipe Cavalcante said infrastructural improvements were fast- paced and include Natal’s new airport, which will be the biggest airport in Latin American when complete in 2011. R$1bn will be invested in new roads, moorings for passenger ships and hotel space.
Infrastructure ‘will be
long-term partners? A SPEED-NETWORKING event took place on day two of Nordeste Invest and property professionals were forced by organisers to move on every 10 minutes, to talk and swap business cards with the next potential business partner. European visitors taking part included Jonty Crossick, founder of Ready2Invest.
Speed networking,
housing? ADIT president Felipe Cavalcante told OPP that if UK developers and asset managers want to invest in social housing they must fi nd a reliable local partner. Cavalcante’s own development company has completed a lower-income social housing project and Cavalcante says there is a lot of bureaucracy to overcome.
Interested in social
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