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Investors see gold in properties in Brazil

International investors that have made big bets on Brazil real estate have no illusions that the Olympic Games will do much to shorten the grueling marathon the country’s economy is running. But some say there is one emerging bright side to Brazil’s prolonged recession, corruption scandals, ailing currency and political crisis: Distress levels for some property owners are reaching the point that they are selling at steep discounts.

Brazil is discovering the benefits of cheap real estate prices as international investors flock to its market for bargains. According to reports, they have made a beeline for Brazil’s capital-starved markets to strike deals with construction firms developing new real estate in Latin America’s largest economy.

For example, Blackstone Group LP is discussing the possibility of a 50% stake with Brazilian real estate company JHSF Participações. The company’s earnings and share price have been on a downward trajectory since last year. Private equity firm GTIS properties is the new owner of Brazil Hospitality Group, the largest hotel group. Other notable real estate companies, such as Tishman Speyer Properties and Equity International, have also struck deals to enter the market. Even Presidential candidate Donald Trump opened a 171-room Trump tower there last year. Trump's firm is also offering work to Brazil's developers post-Olympics.

The surging interest in Brazil’s real estate is surprising especially as the country’s economy has been buffeted by a combination of weak demand and political turmoil. The global economic downturn has resulted in the economy twice entering an economic recession. At the same time, corruption charges brought down the government of former President Dilma Rousseff. The net effect has been a slowdown in the real estate sector, which was earlier in a boom fueled by credit inflows.


The Brazilian stock market is on a carnival this year, with the Sao Paolo Stock Exchange Index up approximately 30% since the beginning of the year.

Buoyed by the stock market’s performance, the MSCI Brazil Stock Index has rallied by 60% since the beginning of this year. And the Invesco Developing Markets fund, which has double the average emerging market weighting for Brazil, is up by 13.6%. The country’s real estate market, which was in a slump after project capital dried up, is witnessing an influx of foreign investors.


The interest from foreign investors in South America’s largest economy is somewhat surprising, especially when you consider its economic and political trajectory in the last one year. After reporting five consecutive quarters of declining GDP, the country is in an economic recession. Its President is being impeached due to a massive corruption scandal involving its largest commodities company. And its biggest sporting extravaganza, the Summer Olympics, is beset by charges of corruption.

Investors are looking at these problems as signs that Brazil’s economy has bottomed out and is a bargain. They have tacked onto its government bonds which offered yields of 11.86% in a world where government bonds in developed markets are offering negative interest rates.


Brazil’s attractiveness as an investment destination has less to do with its politics and more with the lack of suitable alternatives elsewhere. Europe is in disarray post-immigration crisis and Brexit. And Brazil's demographics and relatively developed urban infrastructure have made it relatively attractive after a sputtering in the Chinese growth engine.



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Country Club Resort in Brazil

Brazilians are some of the most health conscious and active people in the world. Whether to live or to vacation to, the country club concept is proving of significant appeal to both the local and international markets, who look for activities to compliment their time on the beach.

As one of the leading country clubs in Brazil, Country Club Resort is designed to provide a wealth of activities to suit all ages and taste.

The on-site facilities and amenities include:

2500 M2 Aquatic Water Park

Swim up Bar

Choice of 3 Restaurants

Games Room

Function Room

Cafés

Spa

Fitness Centre

Sauna

18 Store boutique centre

Artificial beach area

Children’s Pool area

Kids City Play Zone

Children’s party room

Playground

Open Park Areas

Jogging Track

Full Size Football Pitch

5-a-side Football Pitch

Beach Football Pitches

Beach Volleyball Courts

Poli-sports Court

Tennis Courts

Mini Golf Course

Jogging Trail

Archery

BMX Park

Skate Park

Mountain Bike Trails

Rivers & fishing areas

Nature Trails

Horse bridal paths

Equestrian Centre

Meditation Area

Multi Faith worship area

Viewing Towers

Stables

Traditional Brazilian Cottage Industry area

Natural flower honey farm

Market garden centre

Cachaca production area

Milking farm

Shuttle Bus service to local beaches

Shuttle Bus service to city centre

Free resort buggy shuttle service

Whether you wish to relax in the spa, fish in the river, visit one of the stunning beaches less than 5 minutes away, have your children play in one of the largest aquatic water parks in the north east or hit the half-pipe with your BMX, there is literally something for everyone.

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