LN Joint Venture’s Presentation


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LN Joint Venture’s Presentation

  1. 1. PDG Realty signs joint venture with Grupo LN for Paraná and Santa Catarina markets Investors Relations: Michel Wurman Investors Relations Director João Mallet Investors Relations Manager Gustavo Janer IR Analyst Telephone: +55 (21) 3504 3800 E-mail: ri@pdgrealty.com.br 1 Website: www.pdgrealty.com.br/ir
  2. 2. Joint Venture between PDG Realty & Grupo LN Grupo LN is one of the largest construction companies in Paraná and Santa Catarina. Founded more than 20 years ago, the company has launched over 2,500 residential units and has today 5 projects under constructions. The joint venture foresees that, within the market of Paraná and Santa Catarina, all of the projects prospected by one partner must be presented to the other. Grupo LN will held a 30% to 50% stake in each project. Prospect of projects development in the VGV amount of R$100 million (pro- rata PDG Realty) year on year starting in 2008. The partnership will target from mid-high to mid-low income segments and in this last segment Goldfarb will be responsible for the construction. The joint venture has already 3 pre approved projects, with the first launch taking place in the 1Q08. 2
  3. 3. Partnership Rationale Allow PDG Realty’s entrance yet into another market, spreading our capillarity and geographic diversification. Capture the potential swell in the real state market of Paraná and Santa Catarina. Partnership with a company of an effective technical capacity and performance execution. Leverage PDG Realty’s result. 3
  4. 4. Successful track record PDG Realty´s track record proves its ability to continuously originate co-developments and private equity opportunities. Additional Acquisition of acquisition 14,5% stake JV of 21% JV Joint Venture Acquisition Joint Venture Set-06 PDG Realty & LN of 20% stake PDG & Abaurre JV Private Acquisition of Equity... Acquisition of 30% stake Joint Venture 40% stake CHL & PIAL JV Additional Additional acquisition acquisition Feb-06 of 10% of 5% Sale of JV April-07 20% stake Feb-07 Nov-06 May-06 Set - 07 August-07 June-07 July - 07 44 projects launched 21 projects launched 14 projects launched R$ 250 mm 2003 -2006 2Q07 Debenture 1Q07 issuance IPO ...and co-development investments. Jan-07 4
  5. 5. Geographic Expansion Following its strategy of geographic and market segmentation, PDG Realty is present in 31 cities distributed in 6 diferent states. Additionaly, PDG Realty has recently acquired a 30% stake in TGLT S.A, a argentinean real estate developer with projects in the cities of Buenos Aires and Rosário. Bahia: • Salvador Espírito Santo: • Serra • Cariacica Rio de Janeiro: • Rio de Janeiro • Niterói São Paulo: Paraná: • Araçatuba •Mogi Cruzes •Curitiba •Atibaia •Paulínia •Bragança Paulista •Ribeirão Preto •Cajamar •S.Caetano Santa Catarina: •Campinas •Santo Andre •Florianópolis (*) •Cotia •Santos •Guarujá •São Bernardo •Guarulhos •São Jose dos Campos •Itapevi •São Paulo 5 •Itu •Sumaré •Itupeva •Votorantim •Jandira •Jundiaí (*) under analysis
  6. 6. Portfolio Investments Even in a competitive environment PDG Realty was able to make important acquisitions in accretive deals. Rental Income Mid to low income Mid to high income Services Land parceling Properties Part.: 75% Part: approx. 14,5% Part: 17% Part.: 50% of a joint venture Focus: São Paulo, Rio de Janeiro Focus: São Paulo, Rio de Focus: São Paulo Focus: São Paulo and Espirito Santo Part: 17% (indirect) Janeiro, Bahia, Minas Gerais Focus: São Paulo and Rio Grande do Norte Part: 50% JV Focus: Rio de Janeiro Joint Venture Focus: Rio de Janeiro Part: 50% of a joint venture Focus: Bahia JV Joint Venture Focus: Niteroi, RJ JV Joint Venture Focus: Espirito Santo Part: 30% Focus: Argentina 6 Joint Venture Focus: Paraná e Santa Catarina
  7. 7. Closing Remarks Flexibility to capture a large range of investment opportunities and Flexibility market trends Expertise and capacity to invest in different: – Geographic regions Diversification – Markets – Income segments Count on the best Ability to “hire” the best management in the industry and leverage on management teams in their specific and local knowledge the industry Additional capital gain Capital gain potential from portfolio investments since PDG will help its potential invested companies to grow and access equity capital Management with strong real estate expertise, financial background Management expertise and return oriented culture to implement PDG Realty´s business strategy The right platform to accomplish a sustainable long term growth Unique business model in the Brazilian real estate market 7