Cardon Miramar Links

Luxury condo-hotels like this Cardón project are growing in popularity for buyers in Buenos Aires.

At last week’s 125th Annual Rural Expo in Palermo, one booth stood apart from the parade of livestock and farming equipment: a stand showcasing a 49-room condominium-hotel in southern Buenos Aires Province with recreational amenities and the luxury co-branding of the Cardón designer label. The promotion made perfect sense for two reasons: Rural attendees are flush with soy-dollars and condo-hotels are gaining popularity in Argentina.

And the phenomenon is also spreading to the Tango Coast of Uruguay. According to El Pais, the leading hotel developments in Punta del Este now feature condo-hotel components in their master plans. “In the case of Punta del Este, the condo-hotel approach gives middle class investors access to a luxury suite” with the added benefit of annual return on their investment. A 25-story condo-hotel just broke ground on Avenida del Mar, while the sale of the former Melia hotel on Golero Avenue this week will undoubtedly result in a 17-story condo-hotel conversion.

While coastal units are appealing for local city dwellers looking for weekend getaways, Buenos Aires condo-hotels are attractive alternatives for foreign investors who want their own BA pied-à-terre with year-round income potential. With global financial markets increasingly volatile, the portfolio diversification gained from ownership of hard assets means peace of mind. For that reason, 97% of investors in the first IncomeBA luxury condo-hotel were foreign buyers, a trend that has carried over to the second hotel, Palermo Tower. (Google Map)

IncomeBA allows the small investor an opportunity to participate in the surging tourism industry in Argentina and Uruguay with a luxury condo-hotel unit with year-round income potential. For more information about unit prices, floor plans and ROI projections, click here.

BA Property Sales Regain Momentum

Buenos Aires Real Estate Forecast

We forecast several 2011 BA real estate trends in the Summer issue of investBA Privada.

The Notary College just released the May real estate sales data for Buenos Aires, and the numbers are a reversal of the cooling trend witnessed in March and April. While sales in those two months eased 0.7% and 1.3%, respectively, sales rose a respectful 6.8% in May compared to the same month in 2010.

La Nacion’s Alfredo Sainz says the May transaction increase was also accompanied by an increase in the total dollar value of all properties sold. The US$524 million of properties purchased in May represents a 13.4% increase over the US$462 million recorded in May 2010. The average price per unit sold in Buenos Aires falls just short of 400,000 pesos or US$100,000.

According to the Notary College, the 6.8% increase in average unit price reported in May is less than the inflation-adjusted increase in construction and material costs being reported by INDEC, the National Institute of Statistics & Census. Continued strength in the Buenos Aires real estate market is not surprising given the lack of solid investment alternatives and buyer demand for an inflationary hedge.

Sainz says the year-to-date numbers (January-May) show 22,763 transactions recorded at a total value of US$2.26 billion or US$100,721 per property sold. Demand in Buenos Aires is still greatest for premium developments “in various zones of the city” according to the Notary College. Carlos Sotelo of the Argentina Real Estate Chamber says the positive May sales numbers were driven by strong demand for one and two-room units in the best neighborhoods of Buenos Aires. (Full Story in Spanish)

For more information about income-producing properties for foreign investors in Buenos Aires, download IncomeBA (Portugues).

Real Estate Prices in Rio de Janeiro, Sao Paulo and Buenos Aires

Click the image above to view a mash-up of data from UADE and Brazilian Investment Guide

A new report out this month from UADE’s Economics Institute gives us a good feel for average real estate prices for the 14 most popular neighborhoods in Buenos Aires.

And while local media chose to cherry-pick the highest number published in the report (Recoleta’s US$262 per square foot for 2-room apartments) the reality is that the median price was US$186 per square foot with barrios like Palermo and Belgrano coming in around US$226 and US$219, respectively.

And while barrio-by-barrio comparisons can be useful, sometimes regional comparisons are more enlightening, especially for alarmists who say a specific Buenos Aires neighborhood is expensive…relative to what? How about the two largest cities in Brazil? Fortunately, Ruban Selvanayagam’s Brazil Investment Guide is out this month with the most detailed analysis imaginable of real estate prices in Sao Paulo, Rio de Janeiro and three other major Brazilian metros.

The article titled, Brazil’s Real Estate Prices are the Highest in the World, kind of sets the tone for the analysis which show new residential construction in the best neighborhoods of Rio and Sao Paulo cost anywhere from US$200 to $500 more per square foot than new construction listings analyzed by UADE in Recoleta, Palermo, Nuñez and Belgrano. (Click image above for larger chart).

Now factor in the Quality of Living rankings from Mercer and International Living, which consistently put Buenos Aires ahead of all Brazilian metros (See Citi Global Megacities) and it’s easier to appreciate BA’s affordability compared to some of the fastest growing real estate markets in Brazil.

For more information about Buenos Aires real estate opportunities for foreign investors, download IncomeBA. (Versao em Portugues)



We were pleased to celebrate the Grand Opening of Palermo Place. The first hotel in the new P Hotel chain is also the first luxury condominium hotel in the IncomeBA portfolio, a unique collection of income-producing properties for foreign investors in Buenos Aires, Argentina and Uruguay. Special thanks to Bodegas El Porvenir, Bodega del Fin del Mundo and Altos Las Hormigas for the fine wines they shared with our investors for the Grand Opening.

97% of buyers of the 26 luxury-condominium units are foreign investors from the United States, the U.K., Mexico and Australia, and almost of them were able to join us for ten days of Grand Opening festivities here in Buenos Aires from April 25 to May 4. Our buyers came from New York, Mexico City, Sydney, Park City and other corners of the globe to celebrate the hotel’s completion and, for most, their first property investment in South America.

In addition to the opening night party, our group enjoyed a variety of Buenos Aires tours and dinners at Cabaña Las Lilas, Sucre, Osaka and Soberbia 22. We also enjoyed overnight excursions to the Park Hyatt Mendoza, Tupungato Winelands in the Valle de Uco and the Four Seasons in Carmeló, Uruguay before returning to Buenos Aires for the groundbreaking of the next P Hotel, Palermo Tower.

For more information about the remaining units, floor plans and prices in Palermo Tower, click here or complete the form below.

Demand is strong for smaller units. IncomeBA units were designed with foreign investors in mind.

We’re a month away from closing the books on the first half of 2011, and so far it’s been a good year for real estate in Buenos Aires. “In the first half of an election year, real estate activity registered good sales and promises the construction of new projects, writes Clarin’s Gonzalo Berguerand adding, “Condominiums and gated communities with lifestyle amenities are the products most in demand.”

The uncertainty of a presidential election year was the impetus for several developers to hold back on breaking ground on new projects, lot prices are near record highs and the absence of mortgage financing is not likely to be resolved anytime soon.

Yet despite these factors, Berguerand says, “Most would agree: regardless if there is more or less activity in the market, real estate is still the best option for guarding savings and capital. When you consider the other investment options, land and bricks don’t have any competition.”

So what is selling the most? Gated communities and smaller condominium units writes Berguerand. “The combination of a country club and residence is very attractive, meanwhile condominiums and units with smaller footprints are also selling well. The price, security and building expenses head the list of key decision variables.”

In terms of seasonality, spring was historically the best season for sales, but one source tells Berguerand, now “spring” seems to be whenever the economic and political environment is favorable and people are ready to invest.” That being said, we believe spring for many Argentine real estate investors officially begins October 24. (Full Story in Spanish)

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

 

Bariloche

Mendoza

Uruguay

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