The Ifix index – which aggregates the most actively traded real estate funds on B3 – closed this Tuesday (30) session with a gain of 0.16%, at 2,957 points. The Mérito Desenvolvimento Fund (MFII11) topped the list of the highest levels in the trading session, with an increase of 2.04%. Check out the rest of today’s highlights around FIIs . Center.
VBI Reits FoF (RVBI11) focuses on investing in Certificate of Real Estate Receivables (CRI) and in stocks of other FIIs, and points to several signs of changes in the real estate fund market, according to a portfolio management report, released Monday (30).
“In our reading, there are several signs that we may be facing the beginning of a reversal of the pattern observed since the first quarter of 2021, when CRI FIIs (certificates of real estate receivables) began to outperform the ‘brick’ money,” the document details.
For the Fund’s management, the current macroeconomic scenario – of deflation and a possible end to the cycle of high interest rates – points to a recovery of “brick” FIIs – which invest directly in real estate – which have suffered the most from the restrictions imposed by the Covid-19 epidemic and tightening cash.
Unlike in recent years, August was a solid month for “brick” FIIs, which rose 9.6%, on average, versus a slight drop of 0.4% for receivables – which invest in income-grade securities. The firm, which until then had benefited from inflation and higher interest rates.
To contain the price hike, the central bank’s Monetary Policy Committee (Copom) has raised the key rate for the economy, Selic, from 2% to 13.75% annually in the last 15 months. Although they consider the 0.68% contraction recorded by the IPCA in July to be accurate, VBI Reits FoF managers believe that monetary tightening is coming to an end and will start to have an effect.
“Thus, once inflation has stabilized at a better level, there should be no further increases in the policy rate, leaving room for the market to imagine a gradual rate cut in the future,” notes the VBI Reits management report. FoF
The text explains that lower interest causes fixed income investments to offer lower returns, which makes variable income investments more attractive – stimulating a rise in real estate funds.
In addition, the VBI Reits FoF management team is considering that accruals of FIIs – whose yield accompanies divergent Inflation and Selic indicators – will also sense macroeconomic change, and another point to keep the “brick” of FIIs on the radar, expires.
Tuesday’s Biggest Highs (30):
|GGRC11||Income GGR Covepi||logistics||1.61|
|BPFF11||Absolute plural form in Brazil||Nicknames and Val. Home furniture||1.42|
The biggest victims of this Tuesday (30):
|BCRI11||CRI . Objections||Nicknames and Val. Home furniture||-2.83|
|RBRL11||RBR . record||logistics||-2.57|
|Battle 11||home logistics||logistics||-2.13|
|Fino 11||Yenchee offices||corporate panels||-1.5|
|BLMR11||Bluemacaw Renda + FOF||Nicknames and Val. Home furniture||-1.45|
Discover the step-by-step guide to living on income with FIIs and receiving your first rent in your account in the next few weeks, without the need to own property, in a free semester.
Giro Immobiliario: Brookfield has become a leader in office buildings in the country; IGP-M has a contraction of 0.70% in August
IGP-M has a contraction of 0.70% in August; Market expected a decline of 0.54%
The IGP-M (General Price Index – Market) recorded a contraction of 0.70%, and as a result, there was a strong deceleration in the accumulated rate in 12 months, from 10.08% in July to 8.59% in August, announced this Tuesday (30) Fundação Getúlio Vargas (FGV).
The number was significantly lower than the July result (+0.21%) recorded in August 2021 (+0.66%), when the index accumulated above 31.12% in 12 months. The result was also better than expected by the market, which had been expecting a decline of 0.54% according to the Refinitiv consensus.
IGP-M is known as “rent inflation”, as it has historically been used as an indicator for resetting leases. With the contraction in August, the index is now piling up 7.63% on the year.
Andre Braz, Price Indicators Coordinator at FGV, says in Outreach.
In the producer index, the decline in the prices of gasoline (from 4.47% to -8.23%) and diesel (from 12.68% to -2.97%) helped further the decline in the index rate. In terms of consumer, airline tickets (from -5.20% to -17.32%) and ethanol (from -9.41% to -9.90%) also cooled inflation,” says Braz.
Brookfield has become a leader in office buildings in the country
When most people were still working remotely during the pandemic, Canadian firm Brookfield put into action the largest ever office building acquisition plan in Brazil. The company paid R$7.7 billion to purchase 16 buildings – 11 in São Paulo, 3 in Rio, one in Brasilia, and one in Barueri (SP) – most of which remain unoccupied. This move made the company the largest in the field in the country.
In May, Brookfield completed the purchase of 12 buildings from BR Properties for R$5.92 billion. And in December 2021, it closed the acquisition of four buildings from Syn (formerly Cyrela Commercial Properties) for R$1.78 billion. Within two years, the company, which has four more projects under construction, moved from 279,300 square meters of leasable area to 711,800 square meters, an increase of 155%.
Roberto Perrone, the real estate business leader at Brookfield in Brazil spoke Estadao / broadcast. The company believes that building occupancy will increase, and rents will rise from now on. The complexity lies in the business of attracting tenants and charging higher lease fees. “Office rent in Sao Paulo and Rio hasn’t grown in the last 10 years,” he says. “In 2012, a square meter in Marginal Pinheiros was R$120. Today, it’s close to that. In Faria Lima, it was R$170 to R$180. It’s the same.”
The recession, according to Pironi, runs through years of stagnation in the Brazilian economy, political bumps with the prosecution of Dilma and various global problems, from the remnants of the mortgage crisis in the United States to the outbreak of the epidemic and war in Ukraine.
The result of this scenario is that the vacancy rate is currently 20.9% in São Paulo, one of the highest levels ever recorded by the sector. Until the beginning of 2020 (the pre-pandemic period), this indicator was 15.1%, according to a survey conducted by the consulting firm Buildings.
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