Carlyle in debut Brazil RE deal

The Carlyle Group’s new Latin America real estate team has agreed to invest in Brazilian real estate developer Scopel as part of the firm's strategic investments in the region.

The Carlyle Group has made its premiere real estate investment in Brazil by investing in local property developer Scopel. Financial terms of the transaction were not disclosed.

The transaction was made through the firm's recently formed Latin America real estate team, which was established in September 2006.

Eduardo Machado, based in Sao Paulo, heads the Latin America real estate team. Prior to joining Carlyle, he was a managing director at Fibra Realty, the real estate company of the Vicunha group. Machado has also worked in real estate finance and investment banking with Banco Pactual, Rio Bravo and Banco Ourinvest. He was the founder and president of one of the first securitization companies in Brazil and also structured one of the first REITs in the country.

“Brazil’s real estate market is still in a more primitive stage than other markets that were tapped already by international investors, like Mexico, Chile [and others],” said Machado, who is a managing director at Carlyle. There are a lot of opportunities to take advantage of the country’s economic growth and financial stability; demographics including a young population and rising middle class; and the increasing availability of financing, Machado added.

Other members of Carlyle’s Latin America real estate team include managing director Jaime Lara, based in Mexico City, who previously headed the Latin American office of MetLife Real Estate Investments; vice president Renato Ventura, also based in Sao Paulo, who worked for 10 years at Unibanco in real estate finance and investment banking; Gerardo Ruiz, based in Mexico City, a principal for the team and previously new business director for Hines in Mexico; Ramsey Tadros, vice president, based in Sao Paulo, and previously regional manager for Latin America, Africa and Middle East for General Motors Worldwide Real Estate; Marcelo Hanan, a senior associate based in Sao Paulo, previously an associate of JP Morgan’s Latin America mergers and acquisitions group in New York; and Karen Sanvicente, an associate in Mexico City, project manager for Hines Mexico prior to joining Carlyle.

This transaction is Carlyle’s second in Brazil. Earlier this year, the Carlyle/Riverstone Renewable Energy Infrastructure Fund, a joint venture between Carlyle and private equity firm Riverstone Holdings, made an equity investment in Companhia Nacional de Açúcar e Álcool (CNAA) to build four ethanol plants in the center-south region of Brazil.

According to Machado, Carlyle’s main targets in Latin America are Brazil and Mexico. The firm will invest in other regions through more opportunistic investments.