Kallas to have megaproject in downtown São Paulo
Valor Econômico
One of the last empty spaces nestled in downtown Sao Paulo - a 12-thousand-square-meter lot at the corner of Avenida Tiradentes and the traditional address of the brides, Rua São Caetano - was has been fought for by several builders, including publicly-held corporations. Kallas, builder less known than most competitors, managed to outbid the others and take it area. Emílio Kallas, who opened his business 25 years ago, was a friend of the owner of the land. Well connected and with a team with a lot of time at the company - most directors have been there for 10 to 20 years - Kallas has managed to grasp some good opportunities in the real estate market. But that is the project, the largest in the history of the company in general sales value (R$ 400 million/US$ 250 million), which should take it to new heights.
Holding the land - paid in cash - he dared in the project. He will use the concept of mixed undertakings and implement, at the address, a mall, a hotel, a commercial and residential building with compact apartments and parking garage for nearly one thousand cars. Kallas believes it should still take some six months to have the merger registration. "We've noticed a lot of goodwill on the part of public bodies with the undertaking", he says.
The project is still being designed and it may undergo some changes, but the commercial offices should range between 30 square meters and 700 square meters. The mall will have 10 thousand square meters of gross leasable area. And the hotel should not be an economical one. Kallas says he is still talking to the possible brands, but he cannot negotiate spaces, despite the great demand. The project is located in front of the Pinacotheca of the State, near the São Paulo Hall. Now, as owner of the project, he took over the pro-downtown speech. "When we travel, we value downtown areas of the cities so much that we must revitalize ours".
Kallas has not gone public and it does not have an investing partner - both paths that larger companies can seek to capitalize. For four years, until last year, it had the Carval Fund, of Cargill, had as investor, and according to the businessman, it gave up investing in Latin America. The fund was a partner in 10 undertakings and Kallas bought their share. With that, the launchings of the company that were expected to reach R$ 1 billion (US$ 568.2 million) last year stayed at R$ 600 million (US$ 375 million). For 2011, the forecast is to stay between R$ 800 million (US$ 500 million) and R$ 1 billion (US$ 625 million). With neither a partner nor the capital market to finance its growth, the company made its first issue of debentures - it launched the first tranche of R$ 70 million (US$ 43.8 million) from a total of R$ 200 million (US$ 125 million), endorsed by Bradesco.
With strong tradition in the economic segment, the company operates in the capital, in the interior and it has three projects in the region of Baixada Santista. It featured relevant growth in the past three years. According to the balance sheet, it went from R$ 144 million (US$ 78.7 million) in contracted sales in 2008 to R$ 369 million (US$ 209.7 million) in 2010. The net income went from R$ 75 million (US$ 41 million) to R$ 305 million (US$ 173.3 million) in the same period. The profit went from R$ 18 million (US$ 9.8 million) in 2008 to R$ 43 million (US$ 21.8 million) in 2009 and R$ 112 million (US$ 63.6 million) last year. The net margin achieved 37%, comparable to Eztec and above that of other publicly-held companies.