Real Estate in Macae Set to Grow

Macae is a city located about 180 km north of Rio and has been an up and coming city since the discovery of enormous oil and gas deposits. Interestingly, the city used to be a simple fisherman’s village. As an example of growth, within the past 30 years the population has increased from 75,000 to 220,000, and the economy has expanded 200% in the past decade.

The population in Brazil is booming, and with that more foreigners are visiting, more high-end hotels are being built, and new housing developments are being constructed – many of which are happening right in Macae as it evolves into a thriving metropolis. An American who now lives in Rio but commutes to Macae for work told the Rio Times recently:

 

“During just that time frame I have seen it change quite a bit. The hotels and pousadas [Bed and Breakfasts] if not booked at least a week in advance will not have room.[...] Traffic has increased, it can take a while getting around town [and] you can see the buildings going up with apartments.”

The Campos Basin, which is responsible for 80% of Brazil’s oil production and 57% of natural gas production, is located right in Macae. Royalties that were even recently levied on oil extraction from Macae account for R$1.8 billion of the budget for 2013. This increase in budget has allowed Brazil to invest in its education programs, health, and housing. Macae also has the lowest infant mortality rate and the state’s highest literacy rate.

The oil boom in Macae is certainly helping propel the city forward, and as a partner at Capital Negocios Imobilarios (a real estate company), Marcio Murade, states, the arrival of a large construction company and the building of luxury apartment buildings are definitely signs of the growth in Macae. He told the Rio Times recently:

“The market has changed. We have noticed the arrival of a rising number of builders, which bring a higher professionalization for the market. Now you see bigger companies here with even bigger projects: high-end housing with condominium club concepts, top hotels and flats so the change is very clear.”

He also believes that growth is set to continue:

“Demand here is much higher than supply and this is true for those looking for hotels and housing because the city doesn’t really have an infrastructure that is compatible with its actual size, so we will see a sizable level of investment to fill that gap. Macaé’s population will increase from 220,000 to 300,000 in the next four to five years, so it will continue growing and with that, we’ll see more projects and developments.”

Currently, square footage pricing is about 30-50 percent lower than in Rio’s prominent south zone, but prices in the Campos Basin have been doubling since 2009. Murade states:

“Macaé’s market has not stabilized and it continues to expand, so this is why there is a bigger opportunity for growth of real estate investments there.”