Investing in Buenos Aires parking lots

Cochera King: Forget the plazo fijo. You should think about parking your pesos, says C5N.

You just won the lottery in Argentina. Congratulations! Now what?

Well, assuming you don’t have a blowout asado in Jose Ignacio with 1,000 of your closest friends, a fountain of Atamisque Assemblage 2007 and Armin Van Buuren guest DJ’ing, you’re going to have some coins to invest.

That was the scenario posed in an interesting segment this morning on C5N’s Mananas Argentinas which examined some investment alternatives we’ve discussed in earlier posts.

If you played the national lottery and won the Quini 6, you would have 6.5 million pesos (US$1.6 million) burning a hole in your bolsillo. The safest and least lucrative alternative would be the standard “plazo fijo” down at the corner bank paying a meager 0.28%. But then again what happens when some clowns rent a vacant store next to your bank and tunnel into the vault on a long weekend? Next option.

Parking lots? Not a bad choice says C5N, especially in Capital Federal where demand far exceeds supply. Your US$1.6 million could buy you a full parking lot with 66 spaces priced at US$24,000 each. The annual rent for each space would net you about US$2,900 per space or $191,400 per year, a net annual return of 11.9%. Other alternatives discussed were gold, silver and even lithium in Bolivia, home to half the world’s known lithium reserves.

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