October 2008

ING Real Estate  is expanding its investment management activities into South America with the opening of a new office in São Paulo, Brazil.

Brazil is currently the world’s tenth largest economy and home to the fourth largest urban population, with major cities that include São Paulo and Rio de Janeiro.  The country’s economy has grown rapidly for much of the decade and is expected to continue to expand at an average rate of four percent for at least the next five years.  That growth has resulted in significant new job formation and a substantial decline in the unemployment rate for the country’s major cities, and created a compelling environment for real estate investing, according to ING Real Estate.

With a current population of 190 million, including 92 million individuals between 15 and 44 years of age, Brazil is well positioned to benefit from demographic, demand-driven growth for new real estate properties over the next several decades, according to ING Real Estate. In addition to São Paulo and Rio, the country features 18 cities with populations greater than one million. Within these cities, the Brazilian middle class is substantial and growing in both size and wealth.

Office markets in both Rio and São Paulo feature comparatively attractive vacancy rates and compelling rental growth.  Significant opportunities also exist in other major property types, including industrial facilities, retail, and housing. The country is moving aggressively to build on its economic success, with plans for major investments in a range of infrastructure projects including new seaports, railways, highways, and airports.

“We have been analysing the Brazilian market for a while now and believe that the time is right to begin building a presence,” said Beccar.  “With its abundant resources, unique demographic profile, strong manufacturing and services sectors, and growing export economy, the country offers tremendous opportunities for both short- and longer-term commercial real estate investors. We will be focusing on the four main real estate ‘food groups’ of housing, industrial, retail and office which all offer compelling fundamentals.”