2012 Global Market report - NAI Global

Lima, Peru
Caracas, Venezuela
Contact
NAI Peru Rosecorp
+511 440 2630
Country Data
Area (Sq Mi)
GDP Growth
GDP 2011 (US$ B)
GDP/Capita (US$)
Inflation Rate
Unemployment Rate
Interest Rate
Population (Millions)
496,225
6.0%
$162.48
$5,414.27
2.5%
7.5%
4.3%
30.009
Peru’s 2011 growth rate is expected to be 6.3%, a decrease
from 8.8% in 2010 due to repercussions from the change
in government and economic policies and also the US and
European financial crises. However, the World Bank predicts
Peru will continue as a growth leader in Latin America
through 2013. Following this line, the Latin Business Index
highlights the country has the second best macroeconomic
environment in the region. The S&P credit rating improved
from BBB- to BBB.
The industrial sector demand for space keeps growing as
do the rents and this market remains unsatisfied. Sale prices
in Lima for Class A properties are $800 to $1,300/SM and
lease rates in this Class are $4.00 to $7.00/SM. The trend
of industrial migration and relocation continues from central
parts of the main cities due to residential and commercial
developments moving a few kilometers beyond their periphery.
Examples are the district of Cerro Colorado in Arequipa y La
Esperanza en Trujillo and Chilca in Lima; where a new 250
Ha Industrial Park is now being developed at a price of
$30/SM.
The office market has shown a steady increase in rent
throughout the year, a consequence of the supply backlog
and pressure on the ideal land available for office building
projects. The total increase was 9.1% from an average of
$16.5/SM up to $18/SM in the prime office sector. The
vacancy for this segment is at 4.5% in delivered space,
although 51,730 SM was delivered during 2011. By the end
of 2012 or mid 2013, a large number of projects are
expected to be delivered. About 40% of prime buildings
announced over the next two years they will seek LEED
certification, showing an encouraging trend towards
sustainable construction.
The 2011 retail sector growth was steady and continued its
galloping rhythm in all formats. Total sales grew by 25%
reaching $4.1 billion. Peru’s Global Retail delivers new retail
malls nationwide. It is becoming increasingly difficult to find
suitable land for the development of these projects. In
response to these market conditions, malls began to include
office buildings and hotels within the complex, optimizing
their products. Stand alone stores are located on first floor
office buildings and strip center projects are quickly increasing
in number. Thus, the trend in Lima for 2012 will be
mixed-use malls and buildings as well as a greater number
of neighborhood service centers.
Contact
NAI Ferca
+1 58 212 286 8124
Country Data
Area (Sq Mi)
GDP Growth
GDP 2011 (US$ B)
GDP/Capita (US$)
Inflation Rate
Unemployment Rate
Interest Rate
Population (Millions)
352,140
0.5%
$296.34
$9,955.48
32.2%
8.1%
17.4%
29.767
Venezuela offers excellent opportunities for investment due
to extraordinary oil revenues. Although oil prices went from
$147 to $98 (October, 2011), oil revenues are still an
important commodity. The level of Venezuela cash reserves
at the beginning of the economic crisis allowed that
macroeconomic imbalances did not translate into a severe
contraction in the market. The oil sector and oil related
industries are the key drivers of the Venezuela economy.
The office market in Caracas, mostly dependent on foreign
companies, has become thin. Sale and rental prices
increased due to very low inventory, while construction of
new projects started but only a few have entered the market
in 2011. More projects are expected to be finished in 2012,
which will not be enough to catch up with demand for Class
AAA offices.
The industrial real estate market has also seen low inventory
levels in 2011 with rental and sale prices above 2010 levels.
It is expected that this trend will continue through 2012 due
to an increase in oil revenue and plans from the Chavez
administration to reduce unemployment through development
of the manufacturing, construction and agricultural sectors.
Retail has also seen low inventory levels and increased prices.
Vacancy rates at Class AAA shopping centers are extremely
low. The retail sector has benefited from the government policy
of increasing consumption of the lower income population,
which increased the demand of retail outlets.
Investment in real estate among transnational companies
use this type of investment to hedge their Bolivar cash
balances against inflation. Due to the exchange control
system in force since 2006, repatriation of dividends at an
official exchanges rate of $1 to VEF 4.30 is very difficult,
leaving many companies to invest their Bolivar cash surplus
in the office/warehouse market.
Venezuela has the largest oil reserves in the world, a
commodity that will continue to be key to the world economy.
Due to its foreign exchange reserves, it’s estimated that
Venezuela will be able to cope with any temporary variation
of oil price.
The multifamily market has faced strong intervention from
the Venezuelan government. The current deficit is currently
estimated in more than 2,000,000 units. This situation has
caused the Chavez Administration to launch construction
plans financed with public funds and with the cooperation
of foreign countries (Uruguay, Iran and China).
Lima At A Glance
RENT/M 2 /MO
US$ RENT/SF/YR
low High low High Vacancy
doWntoWn offIce
New Construction (AAA)
Class A (Prime)
Class B (Secondary)
suburban offIce
New Construction (AAA)
Class A (Prime)
Class B (Secondary)
IndustrIal
$ 17.00
$ 16.50
$ 15.00
$ 16.50
$ 16.00
$ 13.00
$
$
$
$
$
$
22.00
20.00
17.00
18.00
17.00
15.00
$ 18.95
$ 18.39
$ 16.72
$ 18.39
$ 17.84
$ 14.49
$ 24.53
$ 22.30
$ 18.95
$ 20.07
$ 18.95
$ 16.72
7.00%
4.00%
7.00%
6.00%
3.00%
N/A
Bulk Warehouse
Manufacturing
High Tech / R&D
retaIl
$
$
3.00
3.00
N/A
$
$
7.00
7.00
N/A
$
$
3.34
3.34
N/A
$
$
7.80
7.80
N/A
N/A
N/A
N/A
Downtown
Neighborhood Service Centers
Community Power Center
Regional Malls
Solus Food Stores
$ 17.00
N/A
$ 25.00
$ 32.00
N/A
$
$
$
35.00
N/A
48.00
60.00
N/A
$ 18.95
N/A
$ 27.87
$ 35.67
N/A
$ 39.02
N/A
$ 53.51
$ 66.89
N/A
N/A
N/A
2.00%
3.00%
N/A
deVeloPment land low/m 2 High/m 2 low/acre High/acre
Office in CBD
Land in Office Parks
Land in Industrial Parks
Office/Industrial Land - Non-park
Retail/Commercial Land
Residential
$ 1,700.00 $ 2,200.00 $ 6,879,666.54 $ 8,903,097.87
N/A N/A N/A N/A
$ 400.00 $ 800.00 $ 1,618,745.07 $ 3,237,490.14
N/A N/A N/A N/A
$ 1,000.00 $ 1,600.00 $ 4,046,862.67 $ 6,474,980.27
$ 600.00 $ 1,700.00 $ 2,428,117.60 $ 6,879,666.54
Caracas At A Glance
conversion: 4.30 Veb = 1 us$ RENT/M 2 /YR US$ RENT/SF/YR
low High low High Vacancy
doWntoWn offIce
New Construction (AAA)
Class A (Prime)
Class B (Secondary)
suburban offIce
New Construction (AAA)
Class A (Prime)
Class B (Secondary)
IndustrIal
Bulk Warehouse
VEB 3,084.00
VEB 2,040.00
VEB 1,200.00
N/A
N/A
N/A
VEB 1,020.00
VEB 4,032.00
VEB 3,060.00
VEB 1,440.00
N/A
N/A
N/A
VEB 1,440.00
$ 66.63
$ 44.07
$ 25.93
N/A
N/A
N/A
$ 22.04
$ 87.11
$ 66.11
$ 31.11
N/A
N/A
N/A
$ 31.11
10.10%
7.50%
5.40%
N/A
N/A
N/A
N/A
Manufacturing
High Tech/R&D
retaIl
VEB 684.00
N/A
VEB 1,080.00
N/A
$ 14.78
N/A
$ 23.33
N/A
N/A
N/A
Downtown
Neighborhood Service Centers
Community Power Center
Regional Malls
Solus Food Stores
VEB 3,120.00
N/A
N/A
N/A
N/A
VEB 4,392.00
N/A
N/A
N/A
N/A
$ 67.41
N/A
N/A
N/A
N/A
$ 94.89
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
deVeloPment land low/m 2 High/m 2 low/acre High/acre
Office in CBD
Land in Office Parks
Land in Industrial Parks
Office/Industrial Land - Non-park
Retail/Commercial Land
Residential
VEB 1,720.00 VEB 2,580.00 $1,618,745.07 $ 2,428,117.60
N/A N/A N/A N/A
VEB 860.00 VEB 1,720.00 $ 809,372.53 $ 1,618,745.07
N/A N/A N/A N/A
VEB 3,010.00 VEB 3,870.00 $2,832,803.87 $ 3,642,176.40
N/A N/A N/A N/A
2012 Global Market Report n www.naiglobal.com 78