Brookfield Incorporacoes SA (BISA3), the Rio de Janeiro-based homebuilder, plans to complete its largest luxury apartment project in in the city before the end of 2015 as part of an expansion by Hyatt Hotels ahead of the 2016 Olympic games.
The Hyatt Residencies, located on the edge of a nature reserve in Rio’s Barra de Tijuca beach district, will cost about 200 million reais ($75 million) to build and is about 40 percent complete, said Rodrigo Stallone, a partner at JPL Comercial e Agricola Ltda who hired Brookfield to build the complex and help sell the apartments. The 83 units should bring in an estimated 300 million reais in sales, Brookfield said in an e-mailed response to questions. Sixty-five of the apartments are already sold, Stallone said.
JPL is betting that apartment prices for high-end properties in Barra still have room to grow even after home prices in October grew at the slowest monthly pace since at least 2008, according to economic researcher FIPE and real-estate website Zap Imoveis. Access to the Hyatt hotel’s services and installations and the location, wedged between a protected lake and the Atlantic coastline, make it attractive to wealthy Brazilians and foreigners, Stallone said.
“You don’t build this type of project unless you are tied to a high-end hotel, you have to have a big name,” he said in an interview. “Demand for high-end projects in Rio is bigger all the time.”
Toronto-based Brookfield Asset Management Inc. is offering to buy the shares it doesn’t own in Brookfield Incorporacoes for 1.60 reais each, it said in a Dec. 3 statement.
Hyatt expects to open the hotel before the end of 2015 and has obtained all the necessary permits, it said in an e-mailed response to questions.