Carlyle starts investments in Brazil
Valor Econômico - 02/22/2008
After almost one year analyzing the Brazilian Real Estate Market, the private equity Carlyle group, with international assets of more than US$ 70 billion, gets ready to put into practice its investment projects in Brazil, which may consume almost R$ 500 million (US$ 284.1 million) in the next 18 months. The company has just entered into a partnership with the Fibra group, controlled by the Steinbruch family, to erect a new office building in the heart of downtown Rio de Janeiro, at the corner of São Bento and Acre streets, close to Avenida Rio Branco. This will be the first real estate undertaking in which the Carlyle group invests in Brazil. Last year, the company acquired, by US$ 70 million, considerable interest in Scopel, a company specialized in residential condominiums. "That was, nevertheless, an exception. "We will basically operate in the development of real estate projects, especially those concerning residential projects and shopping malls", states Eduardo Machado, president of the "Real Estate" division in Latin America. The focus of Carlyle will be, in fact, on similar undertakings such as this one it has just entered into with Fibra. The group intends to be the main capital investor in projects that can be developed since their conception. In the case of the partnership with Fibra, Carlyle will be owner of 90% of the business. The partner will develop the project, manage the works and provide 10% of the total investment. The investments will be focused mainly on the residential segment, principally on that segment intended for the middle class of large Brazilian cities. Shopping malls and non-residential properties may also absorb a good part of the nearly R$ 500 million (US$ 284.1 million) the group intends to invest in Brazil in the next 18 months. According to Machado, the idea is to follow the model of being the silent partner in the projects. The Carlyle group also intends to operate in the segment of industrial property and logistics parks. The maturation period of these investments will vary from three to five years.