WORLDVIEW : BRAZIL
2Q2021 Price per Square Foot
|
2Q2021 Cap Rates
Office
7.70 %
Industrial
8.17 %
Retail
7.64 %
|
Office $ 501.30 |
Industrial
$ 44.29
|
Retail $ 43.52 |
|
Deal Volume |
|
|
1Q2021-2Q2021
Office |
$ 167,807,141 |
Industrial |
$ 505,895,499 |
Retail |
$ 16,976,019 |
Major Economic Indicators Capital Volume by Property Type
GDP
1.21 % Growth
in 2Q2021
As of 2Q2021
Unemployment 14.1 %
Inflation 7.21 %
Office 35.4 %
Industrial 56.1 %
Retail 8.4 %
As of 2Q2021
Data provided by Cushman & Wakefield
While the shock of COVID-19 had largely worn down by the start of 2021 , the effects of the pandemic continue to produce chaos in major global economies well into this year . Brazil , for instance , suffered a sharp contraction in gross domestic product in 1Q2021 of 1.5 percent , with unemployment inching upward to 12.9 percent in May .
But the second quarter provided a sense of hope for the largest economy in
South America . The combination of vaccination distribution and easing lockdowns led to increasing consumer confidence , resulting in economic growth — which included a 160 percent increase in major commercial real estate transactions in 2Q2021 compared to the previous quarter .
Overall cap rates dropped from 8.28 percent in 1Q2021 to 8.02 percent in 2Q2021 , according to Cushman & Wakefield . This decline is overwhelmingly a result of the industrial sector ’ s rate dropping nearly a point from 9.02 percent in the first quarter to 8.17 percent in 2Q2021 . Retail and office showed increasing cap rates due to the resumption of commerce .
Growing economic activity is promising for Brazil ’ s recovery . In April and May , 397,089 new jobs were created , and the consumer price index reached 0.53 in June , bringing the accumulated 12-month index to 8.35 , the highest level since September 2016 .
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COMMERCIAL INVESTMENT REAL ESTATE MAGAZINE FALL 2021