Standard Life Investments select new tenants in Brazil
Standard Life Investments, one of the largest real estate investors in Europe, has announced, on behalf of its Select Property Fund, that the Bela Paulista Building in Brazil is now fully let.
Located in Sao Paulo, Bela Paulista is situated at 2421 Avenue Paulista, one of the most prestigious addresses within Brazil's commercial capital. The new tenants include Euler Hermes, Nextel and Ambitec, they join existing tenants Nossa Caixa and Funenseg.
Acquired by the Select Property Fund in August 2010, the 6,542sq.m building was purchased for R$54.5m (£19.9m) and the lettings follow a highly successful campaign by Eccelera, Standard Life Investments' business partner in Brazil, and their letting agent CBRE.
The Fund's strategy in Brazil is to seek well located offices in Sao Paulo and Rio de Janeiro and to add value through refurbishment and operational expertise. Standard Life Investments and Eccelera have also made good progress with the refurbishment of the Alana II building, a multi-let office property located in Berrini, one of Sao Paulo's most established office locations. Purchased in October 2009 by Select, the Alana II Building has undergone a major upgrade, including a modernisation of the façade. The renovation is now complete and the re-letting programme is progressing well.
Andrew Jackson, Fund Manager of the Select Property Fund, Standard Life Investments, said: "We are delighted that, with the help of our business partner Eccelera, we have been able to fully let the Bela Paulista Building within six months of purchase. The combination of high quality
tenants, an attractive double digit income yield and strong rental growth is very positive for investors in the Select Property Fund.
"We are particularly positive on the economic prospects for Brazil and the associated benefits for its real estate markets. The pricing of the Brazilian real estate market is attractive, with yields of 10-12% and annual indexation in rents of around 4-5%. We therefore anticipate making further strategic investments in Brazil.
"The Select Property Fund is also seeking direct investment opportunities in Europe and in markets with muted office construction pipelines such as London, Paris and Sydney."
The first of its kind in the marketplace, the Select Property Fund offers both institutional and retail investors access to global property markets. The £690m fund accesses commercial property markets via direct investment, unquoted specialist property products and stock exchange listed property vehicles globally.