Almeida Junior Innovates with the Launch of AJ Malls REIT in Brazilian Real Estate Market

Shopping mall company celebrates successful IPO and plans expansion

Jaimes Almeida Junior ringing the opening bell at B3

By: SiiLA News

11/16/2023

On Monday (13), the Almeida Junior group, owners of several shopping malls, made an announcement on the B3 stock exchange about a new Real Estate Investment Fund (REIT) named AJ Malls. The Initial Public Offering (IPO) raised R$317 million, slightly short of the planned R$500 million, in exchange for a 7% stake in the portfolio of their six shopping centers.

Jaimes Almeida Junior, the company's founder and CEO, emphasized the significance of sealing the deal on B3, marking a major entry into the capital market. "This marks the debut of the first real estate fund with minority participation in a Brazilian shopping mall market. We kicked off the AJ Malls IPO roadshows in September, wrapping up the offering on October 26 with over 5,000 individual and institutional investors," he proudly announced.

Managed by Capitânia, the shopping REIT will consist solely of assets owned by Almeida Junior. As outlined in the closing document, 4,965 individuals, 14 investment funds, 40 legal entities, and 10 partners, administrators, employees, and other individuals connected to the issuer or participating institution took part in the fund's IPO.

All six developments are situated in Santa Catarina, and the company is already eyeing additional acquisitions.

Almeida Junior's Portfolio

The group's portfolio consists of six shopping mall | Photo: Almeida Junior

Almeida Junior exclusively operates in the Southern region of Brazil, specifically in Santa Catarina. According to GROCS, SiiLA's platform for shopping center data and analysis in Brazil, the group currently boasts a Gross Leasable Area (ABL) of over 220,000 m² spread across six shopping centers: Balneário Shopping, Continente Shopping, Garten Shopping, Nações Shopping, Neumarkt Shopping, and Norte Shopping.

Almeida Junior envisions going beyond acquiring new shopping centers with the new fund. They plan to invest in improving existing assets, such as allocating R$160 million for the expansion of Balneário Shopping in 2024 and injecting R$100 million into Neumarkt in 2025.

The Southern region, encompassing the states of Santa Catarina, Paraná, and Rio Grande do Sul, boasts a vacancy rate in shopping centers frequented by the A-class public at 4.12%. For B-class properties, the current vacancy rate stands at 7.69%, and for C-class, it reaches 23.45%, according to the shopping center data analysis platform GROCS by SiiLA. Similar higher vacancy rates for developments aimed at the C-class are observed in other regions of the country, including shopping centers in the Southeast and Northeast regions.

Stock Exchange History

This isn't the first attempt by the company to make such a strategic move. In both 2018 and 2020, the group endeavored to approach B3 and go public, albeit postponing their plans both times. In 2020, the president and founder mentioned that the IPO delay was due to prioritizing the group's digital project.

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