Attracting Foreign Real Estate Investors to the Brazilian Hotel Market

University essay from KTH/Fastigheter och byggande


The last financial and economic crises have revealed the fragility for developed countries, especially European countries, to resist to a major upheaval. This event has affected for a long time their capacity to spur their economy and their attractiveness. Indeed, trapped in a low GDP and with a high public debt, the last summer has recalled that the situation stay unstable in Europe and U.S.

Nevertheless, following this event, some countries have succeeded to emerge stronger. These emerging countries, especially BRIC countries (Brazil, Russia, India, China), achieve to recover quickly a high GDP rate in spite of the global crisis and are confirming their capacity to reach their economic objectives.

This thesis report focuses on a Real Estate investment recommendation in one of the most attractive emerging countries in the world, Brazil. The country, the last American country entered in recession and the first one exited from it, is becoming more and more attractive. Now, the country is among the ten largest economies in the world and remains very attractive to foreign investors due to its growth potential, large and competitive market and political stability, transforming the country from "a country of the future to a country of the present". Their ability to master the inflation to a stable value, to reduce the net debt and to pay off international Monetary Fund loans reassured investors.

The new Domestic demands accompanied by an increasing business development and touristic demand are transforming the country, especially in the Real Estate sector, ranking it as one of the best place to invest in the world. Thanks to specific strategic investments in Real Estate, investors can make interesting returns and diversify their port-folio which is essential to decrease their exposition to specific risks.

My thesis focus on a specific Real Estate sector: the Brazilian Hotel Market, and describe some strategic investments for foreign investors in Brazil.

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