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Investment Fund May Restore Harrods Buenos Aires to Former Retail Glory

On November 7, 2011, In arts & entertainment, foreign investment, lifestyle, real estate, by InvestBA
An abandoned retail icon could get new life and celebrate its 100th anniversary in 2014.

An abandoned BA retail icon could get new life and celebrate its 100th anniversary in 2014.

Omnia Omnibus Ubique…etiam Buenos Aires?  One of the world’s most famous luxury department stores may soon reopen its landmark Buenos Aires location if a UK investment group purchases and restores the seven-story Harrods building at Florida Street and Cordoba Avenue, according to Alfredo Sainz at La Nacion.

While London-based Harrods is best known for luxury retail, real estate, private banking and aviation services in the UK, the company opened Harrods Buenos Aires in March 1914 which was the most traditional department store in the city for eight decades until closing its doors in the late 90′s. Now those doors could re-open in time for the 100th anniversary of the original grand opening.

Sainz says UK asset management firm Optimum Advisors is finishing due diligence on the purchase and restoration of the BA retail icon, a deal valued at US$280 million. Local market conditions including near-100% occupancy at BA shopping centers and the voracious retail appetite of Brazilian tourists bode well for the restoration of such a high-profile department store. The group is also negotiating for the right to take the Harrods brand to Brazil, specifically Sao Paulo.

Among its other real estate holdings, Optimum Advisors manages a residential chacra development north of Jose Ignacio and an Agribusiness Fund with farmland in Arkansas and Argentina. (Full Story in Spanish)

For more information about Buenos Aires investment opportunities, download the new issue of InvestBA Privada.

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BricksBA: 15 Months of Rising Demand

On April 13, 2011, In foreign investment, real estate, by InvestBA
New Construction in Palermo Hollywood

Prices of new construction units in barrios like Palermo have been rising for fifteen straight months.

Fifteen months ago, the Buenos Aires real estate market moved into positive territory after fourteen straight months of negative prior year comparisons. We characterized the first positive month (December 2009) as Something to Build On, and the prices of new and used properties in the majority of BA barrios have been rising ever since. Looking forward, La Nacion’s Alfredo Sainz says it’s hard to imagine BA real estate prices reversing anytime soon given the lack of investment alternatives.

According to a survey of prices during the November 2010-January 2011 quarter, the price of new construction properties rose anywhere from 2.7% to 8.4% in barrios like Palermo, Belgrano and Nunez. The only two neighborhoods where prices fell slightly were Recoleta (-2.1%) and Barracas (0.6%). Used properties are showing even larger gains than new construction properties with Palermo and Belgrano posting average prices between US$216-225 per square foot.

Despite the typical uncertainty during a presidential election year, the lack of viable investment alternatives and rising inflation are ample incentive for Argentines to continue channeling their savings into bricks. Rising construction costs are one factor that will curb new projects and offset possible concerns about oversupply.

Sure enough, in 2010 Buenos Aires developers submitted permit requests to build and expand 13.99 million square feet of new construction, a 26.8% drop compared to 2009. With the decline in new construction activity in BA, Cordoba is now the Argentine city with the most new construction permit requests. (Full Story in Spanish)

For more information about real estate investment opportunities in Buenos Aires and Argentina, download IncomeBA.

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Seducao: ArgenWines & Brazil’s Middle Class

On February 17, 2011, In a-bric, lifestyle, wine & vineyards, by InvestBA
Expovinis 2011

Held in April, Sao Paulo's ExpoVinis is one of the most important wine expos in the Americas.

The Di­a de San Valenti­n may be over, but the Argentine courtship of the growing ranks of Brazilian wine lovers is poised to intensify in 2011. A booming economy and growing middle class are fueling our Mercosur neighbor’s demand for premium wine from Argentina, so much so that La Nacion’s Alfredo Sainz declares Brazil, “the new mecca for Argentine wine.”

This is a dramatic shift for a country where average beer consumption (53.3 liters per capita) is the fourth highest in the world. And while cerveja still reigns supreme, Sainz says wine consumption is growing rapidly in cities like Rio and Sao Paulo where carioca and paulista tastes and preferences are evolving along with their bank accounts and credit lines. In an effort to capitalize, Argentine wineries are hoping to duplicate and translate the export success they enjoy today in the U.S. to neighboring Brazil.

Magdalena Pesce, Market Manager for the U.S. and Brazil at Wines of Argentina, explains the opportunity. “The Brazilian market has changed radically in the last few years, with the surge of a new middle class with annual salaries between US$12,000 and US$32,000, that is just beginning to discover the world of wine,” says Pesce. In addition to greater proximity, the Brazilian market presents another advantage over the U.S. market: concentration of premium wine consumption. While success in the U.S. might mean conquering 15-20 major metros, two-thirds of all fine wine in Brazil is consumed in Sao Paulo (45%) and Rio (20%).  (Full Story in Spanish)

For more information about Argentina wine and vineyards, visit our archives and download the new issue of InvestBA Privada.

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In Buenos Aires, Winter Goes Out with a Retail, Tourism Bang

On August 4, 2010, In a-bric, buenos aires events, foreign investment, tourism, by InvestBA
Dot Baires Shopping Center in Buenos Aires

Shopping centers like Dot Baires are packed with locals and tourists in a buying mood. (Photo: E. Gallelli)

When we look back on 2010 in Argentina from an economic standpoint, the year will be remembered for some key trends that helped lift the country out of the doldrums of 2008/09: consumer confidence, retail spending, housing demand and the record influx of tourists, both domestic (notably BA for the Bicentennial) and international.

And while we’re still months away from closing the books on 2010, Alfredo Sainz of La Nacion says all of these factors are peaking simultaneously to send winter out with a serious bang of discretionary spending.

“The combination of low temperatures,good macroeconomic signals, purchases delayed for two years, the lack of saving alternatives and a massive flood of Brazilian tourists all combined to make the perfect recipe for winter vacations and winter 2010 in general,” writes Sainz adding, “From the shopping centers, the multiplexes, the clothing stores, the tourism agencies and the airlines, this winter season has been the most successful of the last three years.”

Retail sales are up 20-50% at Dot Baires, Alto Avellaneda, Paseo Alcorta, Abasto and Unicenter; box office ticket sales are up 65%; and the 20% bump in tourists has pushed average hotel occupancy rates to 90%. On the transportation side, Aerolineas Argentinas just announced a 30% increase in July traffic and a whopping 240% increase in traffic from Brazil.

And in a clever case of making limonada out of limoes, the country’s early exodus from the World Cup prompted TAM to divert some originally-scheduled South Africa routes down to the ski slopes of Bariloche. (Full Story in Spanish)

For more information on Buenos Aires shopping and luxury living, download the new issue of InvestBA Privada.

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