Is Rebouças Avenue Poised to Become São Paulo's Next Submarket? Growing Developer Interest Indicates Promising Potential

Rebouças Avenue stands as one of the most important avenues in the city of São Paulo. Serving as a connection between neighborhoods, the avenue starts at Paulista Avenue and extends along the southern zone, passing through significant intersections with access to the Marginal Pinheiros avenue. Known for its heavy vehicle traffic, this traditional avenue is considered one of the primary public transportation corridors, crucial for the city's mobility.

In early 2018, the Oscar Freire station of Line 4-Yellow subway was inaugurated, adding to the avenue's transportation options. Additionally, bike lanes operate throughout its length. By mid that same year, the avenue was populated with older houses that were either for sale or available for lease. These factors combined fueled real estate speculation along the avenue, leading to authorizations for the construction of residential, commercial, and mixed-use buildings by various developers in recent years.

The verticalization of Rebouças has attracted the attention of property owners, tenants, investors, and real estate brokers in the commercial market. In the SiiLA Market Analytics solution office market coverage, Rebouças is situated on the border between four regions: Pinheiros, considered a Central Business District (CBD), and Jardins, classified as secondary. Plus, the avenue starts and ends up at the border of Paulista avenue, also a CBD region, and Faria Lima, the mais financial center of the city.

"Rebouças avenue has the potential to establish itself in the market and gain prominence, potentially evolving into a CBD submarket," says Giancarlo Nicastro, CEO at SiiLA. "The avenue offers several attractive features that position it as a potential primary commercial region, including the upcoming delivery of several corporate buildings within and around its vicinity."

Market Analytics, reveals that four office towers are currently under construction in the adjacent areas of Rebouças Avenue, with an additional four properties in the project phase. Moreover, in 2022, four properties were delivered in this region.

Rebouças Avenue's strategic location, nestled amidst prime regions, positions this emerging area as an enticing choice for tenants seeking to leverage the transportation network and secure more appealing rental prices compared to CBD locations. According to SiiLA's latest Market Statistics, high-end properties (A+ and A) in the surrounding regions showcase compelling vacancy rates and rental prices. Paulista Avenue, for instance, presents a vacancy rate of 6.2% with an average asking price of R$155 per m², while Faria Lima boasts a slightly lower vacancy rate of 5% with an average asking price of approximately R$201 per m² (equivalent to approximately 30.86 and 40 dollars, (respectively). Notably, the Jardins submarket demonstrates a 0% vacancy rate for A+ and A properties, while Pinheiros stands at a 5.90% vacancy rate.