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Brazilian property 'an attractive investment opportunity'

Date added: 30th September, 2010 at 14:01
(view all articles from September, 2010)

Brazilian property offers attractive opportunities for investment in the country, it has been claimed.

Financial services firm Jones Lang LaSalle has praised the nation's real estate market and general economic growth.

The firm reported a large amount of interest in the country from global investors over the past 12 months, spurred on by Latin America's "genuine, highly-compelling, sustainable" expansion.

Restricted supply of commercial property during the credit crisis buoyed the Brazilian office market, the company stated, putting it in an "enviable position".

Speaking to real estate investors at the Jones Lang LaSalle Insiders' Perspectives Conference on Latin America Capital Markets recently, chief executive of the firm's Latin American arm Pedro Azcue said the region was "remarkably resilient" during the recession.

"Latin America is finally on the cusp of capitalising on its vast potential as a true economic growth engine," he stated.

Brazil's largest city Sao Paulo has seen falling vacancy rates in commercial property as demand grows.

The number of people occupying real estate in the city has led to a surge in new developments, Andre Rosa, senior vice-president of the firm's Brazilian Capital Market team, reported.

He noted the sector had enjoyed relative stability in the last 18 months, with prices escalating due to the fresh construction of property.

Furthermore, Brazil can look forward to continued expansion, the firm predicted, saying it expected commercial real estate to remain a good opportunity for investors.

The company forecast another decade of growth for Latin America and, alongside the success of the tourism sector, this is likely to make it more profitable for speculators to look for hotels for sale in Brazil - assets the business expects will have a bright future.

While Jones Lang LaSalle focused on the health of commercial property markets, Bloomberg noted a booming residential mortgage market in the country.

Home loan lending is forecast by the Brazilian Association of Real Estate Credit and Savings Companies in Sao Paulo to leap to R$455 billion (£286 billion) by 2015, compared with R$136 billion by the end of this year, the news provider stated.

The rate at which mortgages are being borrowed in the country is faster than the pace people are signing up to savings accounts, it noted.

Johann Grieneisen, a senior structured finance analyst with Moody's Investors Service in Sao Paulo, asserted: "Market-wide, the financing in the system is going one direction and that's up."

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