Brazil

Brazil at a Glance Brazil

All three major US rating agencies have upgraded Brazil to investment grade status

With reserves close to $200 billion, Brazil has become a net external creditor

After being slightly devalued during the global economic recession, Brazil’s currency has strengthened against the dollar

Inflation has remained under control at the targeted ranges of 4-6%

Source: The Economist

Major Office Sub-markets - São Paulo

Brazil

Centro

Paulista

Jardins

Marginal Pinheiros

Major Office Sub-markets - São Paulo

Brazil

Submarket Inventory (usable m2)

Share per Submarket

Vacancy Rate

Production Sqm

Absorption Sqm

Average Lease Rate Class A

(US$/sqm/month)

Over 5.7 million square meters of stock in São Paulo’s main office submarkets

Source: CB Richard Ellis

Marginal Pinheiros 2,186,900 38% 8.00% 21,400 55,600 $40.00 Paulista 1,023,900 18% 5.30% 31,600 $52.85 Jardins 951,200 16% 4.00% 14,000 $67.14 Centro 362,400 6% 3.30% 89,755 2,300 $11.71 Others 1,225,700 22% 2.80% - 16,200 $34.28 Total / Average 5,750,100 100% 4.68% 111,155 119,700 $41.20

Nestlé Building, São Paulo Brazil

Vacancy remains fairly flat

Market Statistics - São PauloBrazil

Absorption remains flatRental rates continue to rise since the economic crisis

Source: Cushman & Wakefield

Market Statistics - São PauloBrazil

With the tightened vacancy rate, rental rates are expected to rise Despite the global economic recession, Brazil rebounded quickly and resumed new construction

Source: Cushman & Wakefield

Recent Lease Transactions - São Paulo

Brazil

Icon Faria Lima E-TowerFaria Lima Financial Center

E-Tower $60.00 JK 1455 $60.57 JK 1455 $60.57 Faria Lima Financial Center $60.00 Faria Lima Square $62.85 Icon Faria Lima $68.57 San Paulo $51.42

Building Lease Rate US$/sqm

Source: Capright Property Advisors LLC

Major Office Sub-markets –Rio de Janeiro

Brazil

Centro

Botafogo

Flamengo

Barra da Tijuca

Zona Sul

Source: CB Richard Ellis

Submarket Inventory (usable m2)

Share per District

Vacancy Rate

Production Sqm

Absorption Sqm

Average Lease Rate Class A

(US$/sqm/month)

Major Office Sub-markets –Rio de Janeiro

Brazil

Over 2.7 million square meters of stock in Rio de Janeiro’s main office submarkets

Centro 1,714,600 63% 1.80% - 36,900 $74.28 Botafogo 354,400 13% 2.70% - 10,200 $74.28 Barra da Tijuca 313,300 12% 5.90% 9,800 9,200 $55.71 Zona Sul 144,100 5% 6.50% 4,000 5,400 $85.71 Flamengo 51,500 2% 7.10% - 14,000 $62.85 Others 148,000 5% 5.60% - 1,700 $42.85 Total / Average 2,725,900 100% 4.93% 13,800 77,400 $65.95

Market Statistics–Rio de JaneiroBrazil

Demand for office space has been strongRates have increase nearly 30% since the 3Q 2008

Source: Cushman & Wakefield

Market Statistics–Rio de JaneiroBrazil

Net absorption has out-paced delivery of new stock

Source: Cushman & Wakefield

Recent Lease Transactions - Rio de Janeiro

Brazil

Building Sqm Tenant Lease Rate US$/sqm

Ventura Tower I Torre AlmiranteTorre Vargas

Ventura Tower I 45,642 Petrobras $62.85 Torre Almirante 41,110 Renewal of Petrobras $47.26 Ventura Tower II 20,500 BNDES $77.14 Ventura Tower I 9,365 University of Rio Permuta, leased to BNDES $60.57 Torre Vargas 6,300 Oi $48.57 Source: Capright Property Advisors LLC

Office Market ConclusionsBrazil

Due to the lack of real estate development in the 20 years preceding Brazil’s recent economic recovery, demand continues to outpace supply

Fundamental demand for most types of real estate has persisted throughout the global economic recession (construction is back to pre-2008 levels)

Due to substantial FDI and the evolving capital markets, the scale of construction continues to increase

Rental rates continue to increase

Eldorado Business TowerMarginal Pinheiros - São Paulo

• April 2009

• 33,500 square meters

• Sale price: R$ 290 Million / U$S 164.5 Million

• R$ 8,657/SM --- U$S 4,492/ SM

• Buyer: Brazilian Capital Real Estate Fund I

• Seller: São Carlos Empreendimentos

• Cap Rate: 12.0%

Asset TransactionsBrazil

Source: Capright Property Advisors LLC

Asset TransactionsBrazil

Torre AlmiranteCentro - Rio de Janeiro

• March 2009

• 41,649 square meters

• Sale price: R$ 404 Million / U$S 229 Million

• R$ 9,697 / SM ---- U$S 5,501 / SM

• Buyer: Brazilian Capital Real Estate Fund II

• Seller: Hines

• Cap Rate: 12.0%

Source: Capright Property Advisors LLC

Nestlé BuildingMarginal Pinheiros - São Paulo

• June 2007

• 38,000 square meters

• Sale price: R$300 million• U$S 170 Million

• R$ 7,895 /SM --- U$S 4,479 / SM

• Buyer: Hines/CalPERS

• Seller: Banco Itau

• Cap Rate: 9.5%

Asset TransactionsBrazil

Source: Capright Property Advisors LLC

ChallengesBrazil

Absolute necessity to work with local companies due to cultural differences

Due to the strong influx of foreign capital, competition for projects has increased

Finding available land in key markets

Other Opportunities Brazil

Brazil is currently short 6 to 8 million housing units, according to government reports

Rising wealth of the middle class has increased demand for office space, retail outlets, residential space, hotels, and manufacturing facilities

Residential developments in the greater Sao Paulo market have been receiving high leveraged returns at the project level on equity investments - 2 to 3 year hold period

Source: Capright Property Investors

Other Opportunities Brazil

In little more than a decade, the number of major shopping centers went from 150 to 400

More than 200 million shoppers frequent the malls each month

•54,000 satellite and anchor stores •1,300 theaters

Brazil is still vastly undersupplied with retail space

400 shopping centers, or one for every 500,000

Source: National Real Estate Investor

United States has 90,000 or one per every 3,300 people

Other OpportunitiesBrazil

Mixed-Use ProjectsCommercial BuildingsIndustrial / Warehouse

Thank You

Anthony DiBiaseNove International LLC1006 S. Michigan Ave, Suite 225

Chicago, IL 60605+1 708 462 2010