Sao Paulo, Brazil
Last Revised: June 2010
Sao Paulo is the capital of Brazil and with 19 million people it ranks among the fifth most populous metropolitan areas in the world. It is also the most ethnically diverse city in Brazil.
Sao Paulo is the leading industrial and financial center of Latin America and generates approximately $100 billion per year (7%) of Brazil’s GDP. The economy of Sao Paulo is largely service-based driven by the financial, business services and light manufacturing industries.
Sao Paulo’s commercial real estate continues to grow at a solid pace with construction being accelerated on the southern part of Rodoanel Mario Covas in anticipation of the 2010 presidential election.
Developers have begun to offer Class A office space in build to suits as well as modular condominiums. This new office inventory is still insufficient to meet the strong demand for high quality industrial properties, keeping vacancy rates low and the rents stable or high.
Sao Paolo experienced a slight decline in 2009 in office demand and is now seeing an increase in activity due to the government’s ad hoc national economic measures. Many businesses are looking to expand and international investors are returning to inject capital into the economy.
The industrial market continues to remain stable with important gains in manufacturing and distribution. Over the past few years, the industrial market has experienced the relocation of industries from central zones to recently built construction parks in decentralized areas. Companies are motivated to relocation due to the government incentives, lower labor costs and lower cost of housing.
Sao Paulo Rates At A Glance
| Conversion 1.72 BRL |
Net Rent SQ Meter Per Mo. |
USD Net Rent SQ Foot Per Year |
|||
|---|---|---|---|---|---|
| Downtown Office | Low | High | Low | High | Vacancy |
| New Construction (AAA) | BRL 6.25 | BRL 9.16 | $4.05 | $5.94 | 4.3% |
| Class A (Prime) | BRL 5.83 | BRL 8.33 | $3.78 | $5.40 | 5.5% |
| Class B (Secondary) | BRL 4.17 | BRL 7.50 | $2.71 | $4.86 | 6.1% |
| Suburban Office | Low | High | Low | High | Vacancy |
| New Construction (AAA) | BRL 4.58 | BRL 5.42 | $2.98 | $3.51 | 4.3% |
| Class A (Prime) | BRL 4.33 | $2.80 | $2.80 | $3.34 | 5.5% |
| Class B (Secondary) | BRL 4.17 | BRL 5.00 | $2.70 | $3.24 | 10.2% |
Doing Business in Sao Paulo.
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