Hines, the Houston-based international real estate firm, has acquired a 29-story office building in São Paulo, Brazil through its partnership with the California Public Employees Retirement System.
The 29-story, 38,000 m² building was completed in 2002 by the architectural firm Skidmore, Owings & Merrill and Brazilian architect Julio Neves.
Since entering the Brazilian real estate market in 1998 Hines has developed more than 1,086,000 m² of office, industrial and residential space in the country, and currently manages 885,000 m² there. Hines has operations in six markets throughout Brazil, including São Paulo, Louveira, Embú, Rio de Janeiro, Curitiba and Campinas.
The HCB II Fund is an investment vehicle organized by Hines and CalPERS to invest primarily in Brazil’s office, industrial and residential markets, with the option of extending its reach to Argentina and Chile.
The acquisition comes after a number of real estate firms have shown increasing interest in Brazil. In January Lehman Brothers Real Estate Partners made its first investment in Brazil, forming a joint venture with publicly traded Brazilian private equity firm GP Investments and six other firms to invest in the Brazilian real estate market. Private equity real estate firms such as The Carlyle Group and Morgan Stanley have also been drawn to the country recently, as well as large-scale developer Tishman Speyer. J.E. Roberts Companies has also been rumored to be raising a Brazil fund. Although its growth has been less than expected when the concept of the BRIC countries was first conceived, investors have still been drawn to the country in recent years amid a stable economy, a growing middle class and declining interest rates.
CalPERS, the largest public pension fund in the US with assets totalling $249 billion, currently has $19 billion invested in real estate.