JLL identifies retail opportunities in Brazil for major international brands

Leitura de 5min

Consultancy for chains such as Nike, Desigual and Vapiano indicates the ideal places to expand, or to launch new businesses.

Consumer spending in Brazilian stores was up by 1.7% in October, compared with September. Data in a recent study by the Serasa Experian consulting company indicate that this was the best monthly figure for 2013, equaling a similar growth rate in January. Compared with October of 2012, retail activity was up by 2.8%. Even though the outlook changes from month to month, major international brands in the sector have kept their investment plans unchanged, so underscoring their confidence in the potential of the Brazilian market.

This can be seen in the behavior of Nike, one of the world leaders in sporting goods. Betting on the market potential created by the FIFA 2014 World Cup, the brand recently announced that it will open two new stores in Brazil, one in Recife (PE) and the other in Rio de Janeiro. JLL will act as consultant for both these investments.

Nike chose JLL to represent its real estate interests in the opening of its next stores in Brazil, where the market is extremely promising, in particular because of the 2014 World Cup and the 2016 Olympic Games,” said Alex Cerqueira César, a transactions manager at JLL where he is responsible for the retail area.

Recife will host Nike’s largest store in South America, following the ‘build-to-suit’ model. “This will be the most important Nike Factory Store in the region, where a huge variety of the brand’s products can be offered to all types of customer in 2,400 m² of floor area. Rio will be the first Nike Category Store in Brazil specialized in football. The customer will be able to find everything connected to the game, from the most common articles to the most sophisticated professional items. This store will offer the consumer an experience where all the products are dedicated to football,” César said, explaining that the Rio outlet would follow the ‘category store’ concept.

Like the Recife outlet, the store in Rio de Janeiro’s Copacabana neighborhood is due to open in the first half of 2014. The aim is to win over sports lovers by offering exceptional attractions, for example the presence of athletes sponsored by the brand in events open to the public. “This operation by JLL demonstrates the excellent phase of the retail sector in Brazil, which continues to attract international brands in various sectors and is driving the expansion of Brazilian brands in the country,” César said. He mentioned investments by Spanish fashion chain Desigual, which opened its first Brazilian store in October, in the Shopping Pátio Higienópolis mall in São Paulo.

With 200 m² of floor area, this is the first of 50 stores that Desigual plans opening in Brazil through 2018. Work carried out jointly with JLL sought to identify the ideal location in which to start operations in Brazil, as well as helping the chain comply with requirements of Brazilian legislation.

In order for these companies to be able to put together their expansion plans and operate in Brazil, it’s essential that they know the specific characteristics of the Brazilian business environment and the country’s laws. This is why the brands need to have a specialized consultancy that can ensure them ideal conditions to enable them to start operations and help them in their decision-making process,” César said.

The Vapiano gastronomy chain faced a similar situation, needing help to define a strategy to choose locations for its restaurants in São Paulo. Work carried out together with JLL identified the Itaim Bibi neighborhood where the brand, specialized in Mediterranean cooking, will open its first restaurant in the state capital in the first half of 2014. Vapiano has been operating for two years in the city of Ribeirão Preto in upstate São Paulo. Following the Itaim inauguration, the goal is to open nine outlets in strategic neighborhoods such as Moema, Morumbi and Alphaville, with real estate management from JLL. “Vapiano restaurants have around 800 m² of floor space with an innovative profile and modern, welcoming design, where customers interact at communal tables and sample dishes prepared at that moment, the way they like them, and served in the style of casual fresh food,” César said.