Investors Look to Brazil for Growth

History isn't always repeated, but when it comes toof the GDP. This is quite low compared to estimates
real estate investing, many bet on Sam Zell's pastof 11% in Mexico, 20% in Chile, and 45% in Spain.
history. In the 1990's, he gained the nickname "graveWorldwide financial crisis aside, mortgage lending in
dancer" by buying and profiting on distressedBrazil is rising, some reports putting it at 41% this year,
properties. And, worldwide, distressed properties areand companies like Equity International are moving to
definitely in the news now. So, real estate investorsinvest and profit from the growth in Brazil's economy
everywhere pay attention to what Sam Zell says,and particularly the residential housing initiatives and
such as in a recent CNN interview: "Brazil is theconstruction. Of course, building homes spurs
number one country in the world for investments."purchases of durable goods; refrigerators and
There is a lot going on in Brazil, whether it beappliances. The supermarket giant, Grupo Po de Acar
government or private sector housing investment andpurchased Ponto Frio, an appliance manufacturer to
construction. The government's $18 billion stimulus plancash in on this boom in appliance sales.
for building affordable housing is keeping a great manyLet's not leave out opportunities in commercial real
home builders busy. Couple that with a 5 percent cut inestate in Brazil. Singapore recently entered the
Brazil's Selic interest rate, and you have a prettycommercial real estate arena via a joint venture with
positive climate for real estate. Real estate financing isCyrela Commercial Properties. Add to this investment
where Sam Zell says the country needs to place itsfrom the Canada Pension Plan Investment Board's real
emphasis. His privately-held firm, Equity International,estate subsidiary for this joint venture to invest in
has taken an interest, with a large stake in homeoffice buildings, shopping centers, and distribution
builder Gafisa SA. According to an article at the Wallcenters. Analysts from five banks and brokerages
Street Journal Online, half of Equity International'srecently reported to Reuters that Cyrela, Gafisa SA,
invested capital and 70% of its investments' marketand Rossi Residencial all posted operational profits
value is in Brazil.gains in 2008. Taking all of this into account, many
One source reports that the Banco Central do Brazilanalysts predict that Brazil will emerge first and fast
places Brazil's residential mortgage lending at only 2.5%with growth after global financial markets stabilize.