P R E S E N T A T I O N
Neighborhood Centers In the Northeast Brazil
Disclaimer
Neighborhood Center
This Information Memorandum was exclusively prepared for disclosure to potential investors interested in acquiring a shareholding in cities of Cearรก State, Brazil, and to assist them in the preparation of their own evaluations. Therefore, it is not meant to contain all the information that a potential buyer may wish to find.
Potential investors interested in the aforementioned acquisition should conduct their own analyses of this opportunity.
The Company assumes no responsibility for the use of the information contained herein or for the accuracy of any analysis, estimate or projection prepared by the potential interested investors based on this document. Furthermore, the Company disclaims all responsibility for any representation (express or implied) contained in or omitted from this Information Memorandum or for any other written or verbal communication delivered to and considered by the potential interested investors in the course of their assessment of the Company. The only legally valid information is that which will be presented formally in an official purchase/sale agreement and related documents. This Information Memorandum is strictly confidential and it should be used by the potential investors solely and exclusively for the purpose of evaluating a potential acquisition of a shareholding in the development.
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Presentation of Neighbohood Centers Investment 2
Executive Summary
Neighborhood Center
The Center:
• Neighborhood center development created to be a milestone in country side cities with population over 60 thousand inhabitants; • Gross Leasable Area: 2700 m²; • Located in a strategic place, near the most populated area in the growing districts of country side cities.
The Development Small-scale mall serving the local neighborhood
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Return on Investiment Present Value (PV)
Required Investments R$ 4,3 Million
Presentation of Neighbohood Centers Investment 3
Agenda
I.
About the Development
II.
About the Region
III.
Financials
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Neighborhood Center
Presentation of Neighbohood Centers Investment 4
About the Development (1/9) General Information
Neighborhood Center
The development is being idealized to be implanted in the country side cities in the northeast region of Brazil, once these áreas lack of good retail centers. The first phase will take place in the growing state of Ceará with has over ten cities with high potencial to receive this kind of development. It will be a small-scale mall serving the local neighborhood. Typically having a supermarket or a department store as an anchor, and will be commonly arranged in a strip mall format. The Neighborhood center will usually have a retail area of 2700 to 4000 m² and serve a primary area in a 5 km radius, although as being the only professional retail center in those cities, it could also be atending an extended área.
Area
• Land: 5000 m2 to 10000 m2 • Gross Leasable Area: 2700 m2 to 4000 m² • Flagship Store: 1300 m2 • Satellite Stores: 1400 m2 Parking
•122 spots
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Presentation of Neighbohood Centers Investment 5
About the Development (2/9) The Project: Facade
Neighborhood Center
This is the basic layout, however it will be changed in accordance with local market requirements.
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Presentation of Neighbohood Centers Investment 6
About the Development (3/9) The Project: Facade
Neighborhood Center
This is the basic layout, however it will be changed in accordance with local market requirements.
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Presentation of Neighbohood Centers Investment 7
About the Development (4/9) The Project: Facade
Neighborhood Center
This is the basic layout, however it will be changed in accordance with local market requirements.
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Presentation of Neighbohood Centers Investment 8
About the Development (5/9) The Project: Facade
Neighborhood Center
This is the basic layout, however it will be changed in accordance with local market requirements.
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Presentation of Neighbohood Centers Investment 9
About the Development (6/9) The Project: Facade
Neighborhood Center
This is the basic layout, however it will be changed in accordance with local market requirements.
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Presentation of Neighbohood Centers Investment 10
About the Development (7/9) The Project: Facade
Neighborhood Center
This is the basic layout, however it will be changed in accordance with local market requirements.
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Presentation of Neighbohood Centers Investment 11
About the Development (8/9) The Project: Facade
Neighborhood Center
This is the basic layout, however it will be changed in accordance with local market requirements.
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About the Development (9/9) The Project: Basic Layout
Neighborhood Center
ANCHOR
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This is the basic layout, however it will be changed in accordance with local market requirements.
Presentation of Neighbohood Centers Investment 13
Agenda
I.
About the Development
II.
About the Region
III.
Financials
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Neighborhood Center
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About The Region Locator
Neighborhood Center
Northeast - Brazil
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Presentation of Neighbohood Centers Investment 15
About The Region Locator
Neighborhood Center
The Northeast is growing notoriously in the last years, especially after the arrival of the new Brazilian middle class. According to data presented by Exame magazine, in 2012, the region had growth in its gross domestic product of more than three times the national average. This accelerated rise in the Northeast is responsible for the formation of a latent demand, once the market scenario of the region still is poorly explored.
Land 5000 m2 to 10000 m2
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Presentation of Neighbohood Centers Investment 16
About The Region Locator
Neighborhood Center
As exposed in a recent research by the National Support Service for Micro and Small Enterprises (Sebrae) in partnership with the Data Popular Institute, consumption outside the capitals and metropolitan regions moves R $ 827 billion per year. It currently accounts for 38% of all spending in the country. Also according to the study, 74% of residents living in small towns are in urban areas, compared to only 26% in the field and what these people most want in their shopping is quality combined with good prices. A survey by IMalls showed that the cities listed in the following pages, also belonging to the group mentioned by SEBRAE, have potential to receive open malls.
See the full article in the link: http://odia.ig.com.br/noticia/economia/2014-05-20/consumo-do-interior-do-brasilem-alta.html www.imalls.com.br
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About The Region Locator
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Neighborhood Center
Presentation of Neighbohood Centers Investment 18
About The Region Locator
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Neighborhood Center
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Agenda
I.
About the Development
II.
About the Region
III.
Financials
www.imalls.com.br
Neighborhood Center
Presentation of Neighbohood Centers Investment 20
Finantials Valuation: Main Indicators
Neighborhood Center
Financials
Evaluation: main indicators
All figures in R$ '000
Pre-Operational Phase 2013 2014
(=) Net Operating Income (-) Operating Expenses (=) EBITDA (-) Income Tax CF to Firm Investment Free Casch Flow Acumulated CF Internal Return Rate (IRR) Net Present Value (NPV) Operational Phase Minimum Attractive Rate of Return
894.296
4.280.000 -4.280.000 -4.280.000
2016 939.561
2017
2018
2019
Operational Phase 2020
1.089.192
1.143.652
2021 1.200.834
2022 1.260.876
2023 1.323.920
2024 1.390.116
2025
46.932 847.364 101.324 746.040
51.125 888.436 106.452 781.984
55.738 931.381 111.841 819.541
987.119
1.037.088
60.811 976.277 117.502 858.774
64.081 1.025.111 123.405 901.706
67.562 1.076.090 129.576 946.514
71.270 1.129.564 136.055 993.510
75.221 1.185.655 142.857 1.042.798
79.434 1.244.486 150.000 1.094.486
83.927 1.306.189 157.500 1.148.688
88.722 1.370.899 165.375 1.205.524
1.459.622
746.040 -3.533.960
781.984 -2.751.976
819.541 -1.932.435
858.774 -1.073.661
901.706 -171.955
946.514 774.559
993.510 1.768.069
1.042.798 2.810.866
1.094.486 3.905.352
1.148.688 5.054.040
1.205.524 6.259.565
17,43%
18,27%
19,15%
20,06%
21,07%
22,11%
23,21%
24,36%
25,57%
26,84%
28,17%
17,15% 862.910 10 years 13,0%
Pay Back
5,2 years
Investment/Return on Investment
4.280.000
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2015
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