I’m just back from my sixth real estate scouting trip to Brazil in 12 months. You might expect that with such a dense trip schedule, the volume and quality of deals would have started to fall off. But the truth is this market is moving at breakneck speed–and thanks to the new direct flights to Fortaleza I’ll be able to visit more often.
The highlights from my latest trip:
- I stayed at the Hotel Luzeiros, a nice place right in the heart of the boardwalk. I usually stay at the Gran Marquise but when I tried to book a room two months ago they were completely booked out–and this is the off season. Good news if you’re interested in the short-term rental opportunities here (I saw two in particular).
- Staying on that theme…Fortaleza is now the #1 domestic tourist destination in Brazil. And foreign visitor numbers are still growing despite the global economic problems. This year has been a bumper year so far for tourist numbers. Next year work starts on an airport expansion that will increase capacity 260% to 13 million passengers.
- My contacts here are confident that Fortaleza will be one of the Brazilian cities selected to host soccer world cup games. The official announcement hasn’t yet been made, but work on several infrastructure projects has already begun.
- Tourists aren’t the only ones driving a supply-demand opportunity. Fortaleza has an enormous scarcity of good office space. You can buy units pre-construction in the best part of town with as little as 1% down. The rental yields are impressive–typically in low double digits. This office shortage is getting worse as Fortaleza continues to grow.
- The wind on the west coast is perfect to harness as an energy source. One of my contacts has just signed a wind farm deal here. He’s just leasing the land–he didn’t incur the capital outlay to buy the land. But he gets the fat check every year from the utility company for the electricity generated on the land.
- Due to a legal dispute, work on an important bridge (which will connect one of the area’s best beaches with the city in a 25-minute drive) has suffered a long delay. I learned that the dispute is resolved and work will continue soon–so I took a helicopter ride to see what land opportunities the new bridge will open up. Most of this land is a nature reserve and so is of little interest. But one piece of land I spotted will explode in value.
There’s more–a lot more. Too much for me to tell you about in this e-mail. But I’ll share everything I learned on my Brazil trip in a teleconference that takes place Tuesday, May 5 at 1.00 p.m. EST. I’ll be joined by Dan Prescher and Lee Harrison. And you can listen in–free.
You can learn more about what we’ll discuss…and sign up (free) to join us…with this link.
Ronan McMahon
Executive Director, Pathfinder Ltd.
