Faria Lima is not the only option: new areas gain value in São Paulo’s office market
- Data from SiiLA’s Market Analytics show an increase of up to 77.8% in market rental rates as new areas gain traction within São Paulo’s office market
Gentrification is a term used to describe urban transformation processes in areas that undergo economic appreciation, changes in land use and, often, shifts in the profile of residents and local activities. This movement can be observed in different parts of São Paulo, including the city center.
Maxime Barkatz, founder of Ilion Partners, prefers to view part of this process through the lens of urban regeneration. He argues that vacant or underused buildings can have a more negative impact on their surroundings than undeveloped plots.
“It is less harmful for a city block to have an undeveloped plot than an abandoned building. So having an empty lot is not ideal, but having an empty building is much worse. We have even demonstrated, through a study conducted with researchers, that this kind of work generates significant positive externalities,” he explains.
According to Barkatz, bringing properties back into use also helps restore pedestrian activity to the streets and stimulate other businesses in the surrounding area. “It increases safety, increases economic activity and helps stores attract more customers. So there is a whole range of positive economic and social impacts when you carry out a project like this.”
Appreciation beyond Faria Lima
SiiLA Market Analytics data translates the “flow” described by Barkatz into numbers. Pinheiros recorded one of the strongest increases in Market Rent among São Paulo office markets over the past five years, rising 32.8%, from R$98.36 to R$130.65 per sqm.
Between 2021 and 2026, Pinheiros saw its office inventory increase from 293,000 sqm to 449,000 sqm, while vacancy declined from 19% to 13.8% over the same period. Barkatz associates the success of these areas with quality of life and urban dynamism.
“I am very convinced that companies, particularly younger and more innovative ones with more demanding employees, will want to be in neighborhoods like these and will favor more dynamic areas. [...] Every hundred meters, you have already passed ten different stores. There is a much greater density of things happening. I strongly believe that many people prefer that,” he says.
Downtown and the urban vibe
Downtown São Paulo has been undergoing a transformation supported by an urban initiative created by the municipal government to bring residents back to the central area. Although the process is still in its early stages, Market Rent in the region has increased 6.4% over the past five years, and expectations for its recovery remain high.
Urban policy for downtown São Paulo is particularly ambitious. The Central Sector Urban Intervention Area covers approximately 2,089 hectares, including República and Sé and parts of Brás, Belém, Pari, Bom Retiro and Santa Cecília. The plan seeks to increase population and building density while strengthening the local economy. Its main focus, however, is residential development.
“I generally believe in the comeback of downtown as an office district, but I think it will happen gradually. [The República area] is one of the most interesting places in São Paulo. The area between Copan, Avenida São Luís, Rua da Consolação and Avenida Ipiranga has a very vibrant and dynamic commercial environment, 24 hours a day, seven days a week. You have culture, art, concerts and the Municipal Theatre. [...] I don’t know any neighborhood in São Paulo right now that is as interesting as this one. For me, the most important thing is the urban vibe,” he says.
It is precisely in this area that Ilion Partners is betting on a new property repositioning project. The investment manager acquired an office building in Consolação and is preparing interventions to its façade, entrance, access systems and common areas, in addition to improvements to the square in front of the property.
Barkatz avoids describing the project as a full retrofit, instead defining the strategy as a modernization aimed at restoring prominence to a building that, in his view, remained “dormant” while downtown São Paulo lost ground in the office market.
“It has spectacular architecture because it was built in the late 1970s, which was a major period for architecture in São Paulo, at the end of the modernist era. It has a very distinctive and interesting architectural style, as well as a highly efficient floor plate. So it is still a very attractive building and a great place to occupy, in addition to being located in a great neighborhood,” he says.
Office appreciation advances unevenly
SiiLA data shows that Market Rent growth has spread across different areas of São Paulo over the past five years, but at very different rates. Tatuapé led this movement following the delivery of its first high-end office building, Almagah 277. Market Rent rose from R$45.31 per sqm in the first quarter of 2021 to R$80.56 per sqm in the third quarter of 2026, an increase of 77.8%.
In Vila Leopoldina, Market Rent increased 44.9%, from R$60.24 to R$87.30 per sqm, while Pinheiros recorded growth of 32.8%, from R$98.36 to R$130.65 per sqm.
Even among São Paulo’s more established office districts, the increase was significant. In Faria Lima, Market Rent rose from R$189.67 to R$257.45 per sqm, up 35.7%, while JK recorded a 45.1% increase, from R$167.10 to R$242.49 per sqm. Chucri Zaidan also gained value, with Market Rent increasing 19.3%, from R$93.92 to R$112.04 per sqm.
Performance, however, was not uniform. In downtown São Paulo, as previously noted, Market Rent increased only 6.4% over the period, while Barra Funda recorded a 6.8% increase, from R$61.36 to R$65.54 per sqm. The difference reinforces that infrastructure, location and urban transformation policies, on their own, do not translate into the same pace of appreciation across all office markets.
