Do office buildings located in mixed-use complexes have a competitive advantage over other commercial towers? Within the commercial real estate market, it is common to see mixed-use buildings that combine offices, residential units, and leisure spaces in a single asset. Despite the pandemic posing significant challenges for corporate office spaces and malls, the commercial towers that are part of complexes show strong signs of resilience in the return to in-person work.

An unprecedented analysis conducted by SiiLA, based on data and insights available on the Market Analytics platform, reveals that the occupancy rate of towers located in mixed-use complexes tends to be higher than the regional average where the asset(s) is located. The analysis considered the corporate towers in Cidade Jardim Corporate Center, Complexo JK, Market Place, Parque da Cidade, Eldorado Business Tower, and Torre Matarazzo.

Together, these assets total more than 523,000 square meters of stock, with an average occupancy rate of 74.5%, closely approaching the average for high-end offices (A+ and A) in the city, which stood at 76.62% at the end of the first quarter of 2023.

The selected towers for the analysis are predominantly occupied by tenants from the Financial, Pharmaceutical, and IT sectors, with Santander bank, hygiene and cleaning giant Johnson & Johnson, and Banco do Brasil as the main occupants.

Now, let's discuss each complex and its respective region:

Complexo JK

Comprising towers B, D, E, and the Santander Tower, this complex includes Shopping JK Iguatemi and a theater. It is located at the intersections of Av. Juscelino Kubitscheck, Chedid Jafet, and Nações Unidas. Together, they offer over 133,000 square meters of private office space and have nearly zero vacancy, which we can easily with SiiLA Portfolio Analysis tool.  According to our Market Analytics coverage, the towers belong to the JK region, which currently has a 5.2% vacancy rate.

Parque da Cidade

In Chucri Zaidan, we encounter the Parque da Cidade complex. It consists of five A+ corporate towers totaling over 203,000 square meters of total private area and is home to Shopping Parque da Cidade. The current occupancy rate for the five towers combined is 48.81%, and the occupancy profile varies significantly within the complex, with 13 different sectors across the five towers. The leading occupant, occupying the most space in the asset, is Enel, an electricity company.

Market Place

Also located in the Chucri Zaidan region, Market Place is another A+ complex. With its two towers, it offers a total private area of over 28,000 square meters, and the current occupancy rate stands at 75.20%. There are nine different tenant profiles in the towers, with Coworking being the main one, and WeWork being the largest tenant in the property.

In the Chucri region, the occupancy rate for high-end buildings is at 68%.

Torre Matarazzo

Located on Avenida Paulista, the Matarazzo Tower is adjacent to Shopping Cidade São Paulo and is fully occupied by a single tenant, Banco do Brasil. Classified as an A+ corporate property, it consists of 13 floors and offers over 22,000 square meters of private area. The region, in turn, has a 6.2% vacancy rate.

Eldorado Business Tower

In Pinheiros, we find the Eldorado Business Tower, adjacent to Shopping Eldorado. This A+ asset has over 59,000 square meters and was delivered in 2007. The current occupancy rate reaches 89%, which is highly competitive compared to the region's occupancy rate of 94.1%. The largest tenant in terms of leased space is Via, a retail company that leases over 7,000 square meters in the asset.

Cidade Jardim Corporate Center

Lastly, let's talk about the Cidade Jardim Corporate Center complex, which features three high-end office towers currently enjoying a 80,55% occupancy rate. The complex is connected to a shopping center bearing the same name and includes residential buildings. According to the SiiLA coverage, the development is located in the Marginal Pinheiros region, which has a 59% occupancy rate.

As mentioned before, location is a key factor in the real estate market. To attract employees back to the offices, companies that are well positioned, occupying quality assets in desirable regions with a wide range of services and commerce have an advantage in providing convenience for the daily lives of their employees.

For more information about these and other assets located near malls, you can access the Market Analytics platform. SiiLA is a comprehensive hub of solutions for the commercial real estate market, providing a wide range of services for investors, owners, developers, tenants, and others. Discover more!

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