FEBRUARY 2012 |
www.opp.org.uk
THE LAST WORD
Brazil in numbers
• 85 million people constitute Brazil’s middle class - an increase of 37% in two years. • There is a housing deficit of 8 million homes. • Domestic mortgages were re-introduced in 2007 for the first time in 25 years. • Mortgage lending is expected to grow 600% by 2014. • The economy is growing at 5% per annum. • Brazil is protected against the global recession with more than $200bn in reserves. • Best performing of the four BRIC emerging economies - ahead of Russia, India and China. • World’s 10th largest economy and predicted to reach number 5 by 2035. • Almost $1bn invested in infra- structure over past two years. • Trade surplus averages $40bn per annum.
of people who otherwise wouldn’t have any such thing.”
And it makes money too. But how does the social housing sector sit with the international market for Brazilian resort property? Is he worried that the two things are not compatible and that the resort market could throw things out of balance?
No, not at all, he says. “I take a very positive view of the resort market. All the indicators show that the sector has a good future, especially over the next few years.”
“Coastal and recreational demand for property, the forthcoming World Cup and the 2016 Olympic Games, all mean that overseas capital interested in the property development sector of this leading BRIC nation will come together and work well alongside each other.” The business is involved in resort property as well as social housing. “Both sectors fi gure in our plans,” he tells OPP, “but obviously at the moment the latter sector provides the main focus.” And there will also be a real sense of synergy between the housing market and the country’s two giant sporting events over the next few years he says. “Clearly, both the Olympic Games and the World Cup will greatly
infl uence the demand for short and medium-term housing rentals - as well as purchases and resales. Therefore, I believe that the two celebrations will fuel the need for property. In turn, the units themselves will, if handled wisely, provide longer-term facilities for future events and development.” Where do these confi dent insights and his real sense of commitment come from? Has Armstrong-Emery always been in real estate business? “Yes, ever since starting my career in my late teens, real estate has been not just my occupation but my passion. I fi rst fell in love with it when I was nineteen and - apart from my wife and family of course - the fascination with property has gone on being my fi rst love.” In a previous life, he worked for one of Europe’s biggest real estate investment
Developer profi leANTHONY ARMSTRONG-EMERY | 65
“We feel that we are unbeatable in terms of returns, support and terms of business.” he says. “The real estate sector in Brazil is very profi table with plenty of revenue to go around and it is one of our prerequisites that our agents feel safe and secure in terms of their earning ability. Our partnership with agents is seen as just that – a partnership. We offer full training and support and also offer agents the ability to organise a seminar or conference in their locality which we support with marketing collateral as well as a presentation and sales team to ensure the maximum results for our agent partners. We also offer a daily training regime to our internal staff as well as our agency partners. And, through a strategic recruitment policy, we build associated relationships based upon
to get involved in the Minha Casa Minha Vida scheme. He is crystal clear though, that it is the backing of the Brazilian government that is really driving things along. “They really want to see growth in the affordable housing supply,” he says. “To do this, they are funding projects and creating a watertight exit platform for our units. The programme also allows for fi nancing of closing costs and down payments for properties under R$80,000.” And, he adds, “loans for Brazilian purchasers will be between 5%-6% interest depending on income. We have the support of the local and national politicians, the heads of the local realty councils and senior executives of Caixa Economica Federal bank (Brazil’s National Bank).” “Units are being pre-sold and as an
In the money | EcoHouse off ers 20% fi xed annual return on a £23,000 investment
groups and tripled its turnover to £21m as CEO. He moved to South America shortly afterwards and has spent the years since then on developments and investment consultancies in the Caribbean Basin. He is well-connected too, with contacts in the Senior Senate of the Brazilian government and links to some top international agencies such as Cushman & Wakefi eld and Coldwell Banker, as well as top fi nancial institutions such as La Caixa Bank, Santander, HSBC, BRADESCO and Lloyds TSB. All of this means he is able to juggle the R$170 million of projects he has on the go right now. But how does the business work for him day-to-day? Leaving all that emotional passion and attachment, all that history and all those connections to one side, how does EcoHouse operate and what is its attitude towards agents?
solid long-term experience within the overseas sector.”
And the demand is there. “So far, we have sold more than 200 units to local purchasers, and a similar number to international investors.” Progress is being made at a rapid pace. “The fi rst and second phases of our plan were successfully completed on time,” he says, “with the next three phases on target for their intended completion dates. We are aiming to build a further 1,200 units by the end of the year.” “Ultimately, we’re selling to ordinary working families in Brazil of modest means. This affordable housing scheme means that for the very fi rst time in the country’s history, millions of ‘lower middle class’ folk can contemplate owning what was formerly just a dream, a home of their own.” And they are out there in huge numbers, eager
indication of demand, 8 days after the programme was launched in Natal, 25,000 families had signed up to purchase their home. Currently there is a 70,000-person waiting list and only 2,000 approved homes.” This is the perfect place to be says Armstrong- Emery. “Quite frankly, I’m not interested at present in anywhere else but Brazil. The country has an exciting balance of natural resources, space for growth, an enterprising society and an expanding economy that is benefi ting the wider society.” Rest assured, he is going to be sticking it out for quite some time to come.
The Facts
• Properties are built using inves- tors’ funds. • Return on investment is currently up to 20%. Min entry level £23,000. • Repayment will start 12 months after the date that the client’s full payment is received into escrow. • The full balance due to the client will be paid at the end of month 12. • If, for any reason, the project does not go ahead, the cli- ent’s funds will be returned by lawyer-operated Lloyds TSB Escrow account. • The capital and interest are repaid in full and investors will be offered early options on the next Ecohouse Group Project.
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