Brazil has generated much interest as private equity real estate firms look to expand in Latin America. Now Prudential Real Estate Investors, the real estate investment and advisory business of Prudential Financial, has formed a joint venture with Racional Engenharia to invest in the Brazilian industrial real estate market.
The venture continues Prudential’s strategic investments in Latin America. “Through this joint venture, PREI may, including leverage, invest up to $1 billion to amass an exceptional portfolio of industrial properties in Brazil on behalf of institutional clients,” Francisco Andragnes, principal and chief investment officer of PREI Latin America, said in a statement. “As we expand in Brazil, we are seeking to build upon the success that PREI has already had with its industrial investment program in Mexico.”
The joint venture will target the development of distribution centers, light manufacturing facilities and industrial parks in Brazil.
Paulo Gomes, vice president and chief strategy officer of PREI Latin America, pointed to Brazil as a rapidly developing center in Latin America: “Growth in the sector should reflect the accelerated expansion of the industrial, consumption and credit segments of the economy,” he said. “Additionally, those trends have created demand for quality industrial space in strategic locations in Brazil. Therefore the opportunity for growth is unparalleled.”
Earlier this month, The Carlyle Group announced its investment in Brazilian real estate developer Scopel as the firm looks to expand its presence in Latin America. Carlyle’s Latin America real estate team, established in September 2006, is headed by Eduardo Machado with real estate professionals based in Sao Paulo and Mexico City.