Investors Look to Brazil For increase

History isn't all the time repeated, but when it comes to real estate investing, many bet on Sam Zell's past history. In the 1990's, he gained the nickname "grave dancer" by buying and profiting on distressed properties. And, worldwide, distressed properties are by all means; of course in the news now. So, real estate investors anywhere pay attention to what Sam Zell says, such as in a modern Cnn interview: "Brazil is the estimate one country in the world for investments."

There is a lot going on in Brazil, either it be government or inexpressive sector housing investment and construction. The government's billion stimulus plan for construction affordable housing is holding a great many home builders busy. Consolidate that with a 5 percent cut in Brazil's Selic interest rate, and you have a pretty definite atmosphere for real estate. Real estate financing is where Sam Zell says the country needs to place its emphasis. His privately-held firm, Equity International, has taken an interest, with a large stake in home builder Gafisa Sa. Agreeing to an report at the Wall road Journal Online, half of Equity International's invested capital and 70% of its investments' store value is in Brazil.

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One source reports that the Banco Central do Brazil places Brazil's residential mortgage lending at only 2.5% of the Gdp. This is quite low compared to estimates of 11% in Mexico, 20% in Chile, and 45% in Spain. Worldwide financial crisis aside, mortgage lending in Brazil is rising, some reports putting it at 41% this year, and fellowships like Equity International are moving to spend and profit from the growth in Brazil's cheaper and particularly the residential housing initiatives and construction. Of course, construction homes spurs purchases of durable goods; refrigerators and appliances. The supermarket giant, Grupo Po de Acar purchased Ponto Frio, an appliance builder to cash in on this boom in appliance sales.

Let's not leave out opportunities in commercial real estate in Brazil. Singapore recently entered the commercial real estate arena via a joint investment with Cyrela commercial Properties. Add to this investment from the Canada Pension Plan investment Board's real estate subsidiary for this joint investment to spend in office buildings, shopping centers, and distribution centers. Analysts from five banks and brokerages recently reported to Reuters that Cyrela, Gafisa Sa, and Rossi Residencial all posted operational profits gains in 2008. Taking all of this into account, many analysts predict that Brazil will emerge first and fast with growth after global financial markets stabilize.

Investors Look to Brazil For increase

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