- The commercial real estate market in Brazil remains underdeveloped compared to major global markets like London and Tokyo, despite rapid growth in recent years. - Office markets in São Paulo and Rio de Janeiro have seen total stock grow approximately 3% annually over the last 5 years, constrained by lack of infrastructure. Vacancy rates are at historic lows due to high demand and limited new supply of quality space. - Rents for A and AA office properties have increased significantly since the mid-2000s in both São Paulo and Rio de Janeiro, bringing prices closer to global cities like London and New York City. - The industrial real estate market in São Paulo remains strong, driven by consumption growth and demand for distribution

1. Commercial Property Market

2. -
10.000.000
20.000.000
30.000.000
40.000.000
50.000.000
60.000.000
70.000.000
80.000.000
90.000.000
100.000.000
Tokyo London Manhattan Paris Munich Toronto Madrid São Paulo Rio de Janeiro
Total Stock Population
Office: Principal Business Centers in the World
2
Source: CB Richard Ellis Brazil
Despite its accelerated growth in recent years, the office market remains underpenetrated in
Brazil compared with other major global markets

3. Office: Total Stock – São Paulo
3
AAA
6% A
11%
Other w/ CAC*
39%
W/out CAC*
44%
15% 22%
41%
7%
23%
50% 40%
44%
40%
77%
35% 38%
15%
53%
Downtown Paulista Jardins Marginal Other
A + AAA Other w/ CAC Other w/out CAC
Quality Weight GLA m² GLA sf
AAA 6% 689.274 7.419.284
A 11% 1.263.669 13.602.020
Other w/ CAC* 39% 4.480.281 48.225.343
W/out CAC* 44% 5.054.676 54.408.080
Good Quality Properties 17% 1.952.943 21.021.303
* Central Air conditioning
Quality by Region
Source: CB Richard Ellis Brazil
São Paulo’s stock lacks good quality properties, with the highest technical specifications, despite
being one of the most important business centers in the globe

4. 4
Quality by Region
54% 60%
89%
40%
68%
80%
46% 40%
11%
60%
32%
20%
Downtown Flamengo Botafogo South Zone Barra da Tijuca Other
With CAC Without CAC
Quality Weight GLA m² GLA sf
AAA 2% 119.506 1.286.352
A 14% 836.542 9.004.463
B 13% 776.789 8.361.287
Other w/ CAC* 28% 1.673.084 18.008.926
W/out CAC* 43% 2.569.379 27.656.565
Good Quality Properties 16% 956.048 10.290.815
* Central Air conditioning
AAA
2%
A
14%
B
13%
Other w/
CAC*
28%
W/out CAC*
43%
Office: Total Stock – Rio de Janeiro
Source: CB Richard Ellis Brazil
Rio de Janeiro remains a tight market, driven by the oil and gas industry boom, scarcity of good
quality space, geographic barriers to entry and lack of adequate mass transportation
infrastructure

5. Office: Total Stock – São Paulo and Rio de Janeiro
5
Source: CB Richard Ellis Brazil
Over the last 5 years, total stock in both markets has grown at approximately the same pace
(3% annually), constrained by the lack of infrastructure
5.110.800
5.291.400
5.530.900
5.681.300
5.853.100
6.022.600
2.460.100 2.517.300 2.609.300 2.711.700 2.780.400 2.892.500
-
1.000.000
2.000.000
3.000.000
4.000.000
5.000.000
6.000.000
7.000.000
2006 2007 2008 2009 2010 3Q11
São Paulo Rio de Janeiro

6. 6
Office: Vacancy Rates – São Paulo and Rio de Janeiro
Source: CB Richard Ellis Brazil
Growing demand for quality space and restrictions in new supply have led to historically low
vacancy rates, with better quality properties presenting better performance in both bull and bear
markets
3,1% 3,1%
N/A N/A
0,8%
0,0%
2,0%
4,0%
6,0%
8,0%
10,0%
12,0%
14,0%
2006 2007 2008 2009 2010 3Q11
São Paulo Rio de Janeiro BRPR (SP &RJ)

7. 7
Office: Average Rent/ m²/ Month - A and AAA Properties
Source: Jones Lang La Salle Brazil and Cushman & Wakefield
Average price/m² has increased since the mid 2000’s after many years of stagnant growth, which
has brought Brazilian prices closer to those of the developed world
69
77 73
84
95
75
83
90
107
120
N/A N/A
201
247
266
N/A N/A
115 117 120
N/A N/A N/A
52 57
-
50
100
150
200
250
300
2007 2008 2009 2010 3Q11
São Paulo Rio de Janeiro West End - London Midtown Manhattan BR Properties

8. Industrial: São Paulo Inland
8
Source: CB Richard Ellis Brazil
Vacancy Rates
Total Stock
The industrial market remains strong, driven by faster consumption growth and increased
demand for distribution facilities
3.377.100 3.511.000 3.724.900 3.848.300
4.120.900 4.167.300 4.290.700
4.528.600
4.817.300
-
1.000.000
2.000.000
3.000.000
4.000.000
5.000.000
6.000.000
3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11
Stock
6,2%
0,1%
0,0%
2,0%
4,0%
6,0%
8,0%
10,0%
12,0%
3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11
Vacancy BRPR

9. Industrial: São Paulo Inland
9
Average Asking Rents in São Paulo Inland (R$/ m²/ month)
Average Asking Rents in Other Markets (R$/ m²/ month – 2Q11)
Source: CB Richard Ellis Global and Jones Lang La Salle USA.
36
32
24
20 19
10
Tokyo London Singapore São Paulo Inland Sydney Los Angeles
Lease prices have stabilized, and are expected to remain at these levels because of the difficulties
in obtaining environmental approvals. Sluggish economic growth is not expected to affect lease
prices in the mid-term
17
19 19 20 19 19 19 20
23
-
5
10
15
20
25
3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11
Asking Rents

10. Fragmented Industry
10
Addressable Market1: 36.3 mm m²
BRProperties
10 Organized
Companies
Organized
Companies
9%
Non-Organized
Market
91%
35%
65%
Fragmented Industry (in terms of GLA – m²) Brazil: Owned vs Leased – Large Companies
USA: Owned vs Leased – Large Companies
The large majority of the companies in Brazil still own their real estate
In the USA, only 20% of the companies own their real estate assets
Own
Buildings
20%
Leased
80%
Own
Buildings
80%
Leased
20%
Source: Internal Estimates and Itaú Securities
Highly fragmented and non-institutionalized market creates an attractive environment for the
industry in the coming years

11. Takeaways
11
 Industry dynamics still present very attractive growth opportunities;
 Infrastructure constraints will keep both office and warehouse markets tight in the mid-term;
 In the short run, slower economic growth may have a slight impact in vacancy rates, leading to
stabilization of lease prices;
 Players with better quality portfolio’s and below-market lease prices should be more resilient than
developers;
 Lower interest rate environment with greater access to credit and urban redevelopment of existing
areas (i.e.: Porto Maravilha project in RJ) will drive the industry’s growth in the long run.