Peru Real Estate Report Q3 2011
Includes 3 FREE quarterly updates
Peru has one of the most favourable prospects for real estate in the world, according to the Global Commercial Property Survey by the Royal Institution of Chartered Surveyors in May 2011. It is grouped at the top with Hong Kong, China, Singapore and Brazil as presenting the best opportunities.
Key factors include:
Real GDP growth in Peru was 8.8% in 2010. We are pencilling in real GDP growth of 6.2% in 2011 and 4.9% in 2012. Economic growth has been largely driven by domestic consumption, business confidence, exports and construction. Rising prices pose a risk to an otherwise positive outlook for Peruvian economic growth.
Peru’s office property market has bottomed out after the recession, and rents are now beginning to accelerate, posting greater gains than in 2010. The supply of class A space will increase, possibly increasing vacancy rates.
Domestic industry is beginning to transform raw materials and generate higher value products. This movement to produce more value-added products is leading to increasing total industrial production, which is in turn spurring development of the industrial property market. Total manufacturing output is expected to grow by around 10% over 2011.
With the surging growth of the economy, consumer spending power has increased, which is driving retail growth, and with it, the retail property sector.
Peru ranks first in Latin America for improving business regulation, according to a report by the International Finance Corporation and the World Bank, issued in November 2010. Peru has moved up 10 places in the global ranking of 183 economies. However, according to Jones Lang LaSalle’s Global Real Estate Transparency Index 2010, Peru is ranked poorly, at 72nd out of the 81 countries surveyed for real estate transparency in 2010.
China has made significant trade inroads into Latin America, largely as a result of its appetite for minerals. Among other partnerships in the region, China has become Peru’s second largest trading partner for imports and exports – after the US – as of December 2010.
The election of Ollanta Humala poses downside risks to the Peruvian investment landscape; negative investor sentiment was reflected immediately after the election, with the next day stock market dropping 9%.
Peru has one of the most favourable prospects for real estate in the world, according to the Global Commercial Property Survey by the Royal Institution of Chartered Surveyors in May 2011. It is grouped at the top with Hong Kong, China, Singapore and Brazil as presenting the best opportunities.
Key factors include:
Real GDP growth in Peru was 8.8% in 2010. We are pencilling in real GDP growth of 6.2% in 2011 and 4.9% in 2012. Economic growth has been largely driven by domestic consumption, business confidence, exports and construction. Rising prices pose a risk to an otherwise positive outlook for Peruvian economic growth.
Peru’s office property market has bottomed out after the recession, and rents are now beginning to accelerate, posting greater gains than in 2010. The supply of class A space will increase, possibly increasing vacancy rates.
Domestic industry is beginning to transform raw materials and generate higher value products. This movement to produce more value-added products is leading to increasing total industrial production, which is in turn spurring development of the industrial property market. Total manufacturing output is expected to grow by around 10% over 2011.
With the surging growth of the economy, consumer spending power has increased, which is driving retail growth, and with it, the retail property sector.
Peru ranks first in Latin America for improving business regulation, according to a report by the International Finance Corporation and the World Bank, issued in November 2010. Peru has moved up 10 places in the global ranking of 183 economies. However, according to Jones Lang LaSalle’s Global Real Estate Transparency Index 2010, Peru is ranked poorly, at 72nd out of the 81 countries surveyed for real estate transparency in 2010.
China has made significant trade inroads into Latin America, largely as a result of its appetite for minerals. Among other partnerships in the region, China has become Peru’s second largest trading partner for imports and exports – after the US – as of December 2010.
The election of Ollanta Humala poses downside risks to the Peruvian investment landscape; negative investor sentiment was reflected immediately after the election, with the next day stock market dropping 9%.
Contents
Executive SummarySWOT Analysis
Peru Real Estate/Construction SWOT
Peru Economic SWOT
Peru Business Environment SWOT
Real Estate Market Overview
Market Analysis
Table: Peru’s Real Estate Market – Historic Rents, 2009 And 2010 (m2/month, US$)
Table: Peru’s Real Estate Market – Net Yield (%)
Table: Peru’s Real Estate Market –Terms Of Contract/Lease (mid-2010)
Table: Peru’s Real Estate Market – Available (m2) And Vacant Space (%)
Industry Forecast Scenario
Table: Peru’s Real Estate Market – Rentals, 2010-2012 (m²/month, US$)
Table: Peru’s Real Estate Market – Forecast Net Yield (%)
Construction Industry Outlook
Table: Peru Construction And Infrastructure Industry Data, 2007-2015
Table: Peru Construction And Infrastructure Industry Data, 2012-2020
Macroeconomic Outlook
Table: Peru – Economic Activity, 2008-2015
Business Environment
Real Estate/Construction Business Environment Ratings
Table: Latin America Business Environment Ratings
Peru’s RECBER
Peru’s Business Environment
Table: BMI Business And Operation Risk Ratings
Table: BMI Legal Framework Rating
Table: Labour Force Quality
Table: Latin America, Annual FDI Inflows
Table: Trade And Investment Ratings
Table: Top Export Destinations, 2003-2009
Competitive Landscape
Company Profiles
Abengoa
Cemento Andino SA
Cementos Lima
Cementos Pacasmayo
Centros Comerciales del Peru (CCPSA)
Cosapi
Graña y Montero (GyM)
Inversiones Centenario
Los Portales SA
Negocios e Inmuebles SA
BMI Methodology
How We Generate Our Industry Forecasts
Construction Industry
Bank Lending
Real Estate/Construction Business Environment Rating
Table: Weighting Of Indicators
Sources . 49 Skip to top