New Multifamily Business Model Targets Corporate-Funded Residential Leases

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Just like commercial office leases, when companies rent units in residential buildings, the contracts are legally considered non-residential leases. This definition is outlined in Article 5 of Brazil’s Tenancy Law (Law No. 8,245), which states:

“A lease is considered non-residential when the tenant is a legal entity and the property is intended for use by its owners, directors, partners, managers, executives, or employees.”

In other words, the legal nature of the contract is determined by the tenant’s profile—not the property type. However, another common arrangement is for the employee to rent the unit directly and later seek reimbursement from the company.

A recent example is the lease signed by JFL Living at the Alto das Nações complex in São Paulo. The company leased five floors of the AV.NU building for R$28.1 million. The three-year contract follows a long-stay model, closely resembling a traditional residential lease, even though it was signed by a corporate entity.

Currently, developments exclusively focused on long-stay rentals represent 15% of São Paulo’s multifamily stock, according to the company. When including properties that operate under a mixed model—with both short- and long-term units—the share rises to 32.8%.