High-end Offices on Faria Lima Avenue are Nearing Full Occupancy

With 94.7% occupancy, the high-end offices in Brazil's most sought-after corporate district are nearly filled to capacity, leaving little room for new tenants. Faria Lima, also known by various other names, serves as a source of inspiration for digital influencers who populate their social media profiles with photos of developments in the area, behind-the-scenes glimpses of the corporate world, and other topics that revolve around the city's financial hub. As an example, Faria Lima Elevator page on Instagram brings daily content about the region.

In 2019, Veja magazine published an extensive report on the lifestyle and high salaries of those who work or frequent the region, informally referred to as "Faria Limers". The article featured data and statistics provided by SiiLA. At the time, the vacancy rate was the lowest in the capital, just over 8%, considering high-end assets (A+ and A) and class B.

Since then, the Covid-19 pandemic has shaken the office market, with restrictions and social distancing measures leading to a decrease in non-essential work activities. Even during the health crisis and the influx of new supply with the inauguration of the impressive Birmann 32, which added an additional 49,000 square meters of corporate floors in July 2020, the Faria Lima region has maintained its prominence.

To provide some context, by the end of the first quarter of 2020, the vacancy rate stood at 8.2%, with an average asking price of R$ 179 per square meter. By the end of 2021, it had significantly dropped to 4.5%, and now, in the second quarter of 2023, it sits at 5.3%, with an average asking price of R$ 198.90 per square meter.

Analyzing the over 496,000 square meters of A+ and A corporate floors in Faria Lima, we find that nearly 95% of the available private area is occupied, primarily by players in the financial market, accounting for over 40% of the leased space, followed by the IT sector with 92% and E-commerce with 8.2%. Among the largest tenants, national banks Itaú and BTG Pactual take the first and second positions, respectively, followed by Facebook, Google, and Shopee.

Out of the 28 selected properties in the survey, 13 are fully leased, and 6 have a vacancy rate below 5%. The fully occupied A+ assets include iconic properties in the region such as Torre Sul do Pátio Victor Malzoni, Faria Lima 3500, Faria Lima 4440 – Acqua, International Plaza I, and Miss Silvia Morizono. Some of these assets are owned by real estate investment funds. Recently, the REsource editorial team produced content about some Faria Lima and JK developments that belong to REITs. Read the full article here.

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