Expansion consumes more than US$ 8.72 billion
Valor Econômico
The large retailers will dump more than R$ 15 billion (US$ 8.72 billion) in the country over the next three to four years. Only the Pão de Açúcar groups, Walmart and Lojas Americanas will open nearly 300 stores this year, which should lead to a record in the increase of the total area of sales in the Brazilian retail. The shopping mall chains already feel the strong demand for space and are also resuming the construction of several new undertakings. The vacancy level in the 35 shopping malls of BR Malls was the lowest one in the history of the company in the fourth quarter, only 2.1%, which represents the maximum occupation.
The consumers are willing to open their wallets. The Consumer Confidence Index (ICC, in Portuguese), calculated by the Federation of Commerce (Fecomercio) of São Paulo, is at an unprecedented level, getting to 158.7 points in January. When it is above 100 points, the ICC is considered "optimistic". "It will be an excellent year for retail", says Enéas Pestana, Executive Vice President and Chief Operating Officer of the Pão de Açúcar Group. The combination of at least three factors indicates the sky is clear for the retailers in 2010: presidential elections, the FIFA World Cup and the reaction of the real estate market.
Pão de Açúcar will invest R$ 5 billion (US$ 2.9 billion) in 2010, 2011 and 2012, which should generate the creation of 100 thousand jobs in such period. The value does not include acquisitions, nor does it include the retail operation of electric and electronic appliances, recently created with the acquisition of Ponto Frio and Casas Bahia.
The President of Walmart in Brazil, Héctor Núñez, had already announced, in December, an investment plan between R$ 2 billion (US$ 1.16 billion) and R$ 2.2 billion (US$ 1.28 billion) in 2010. The value is the largest capital investment in Brazil since the American company landed in the country, 14 years ago, and it is 40% above the total invested in 2009, of R$ 1.6 billion (US$ 812.2 million).
Soon after indications that the crisis had vanished from the horizon, in the mid-2009, Lojas Americanas announced a strong program of investments. The chain that sells from chocolates to lingerie to home appliances will invest R$ 1 billion (US$ 581.4 million) between 2010 and 2013. Carrefour informed yesterday it will invest R$ 2.5 billion (US$ 1.45 billion) between 2010 and 2012.