Brazilian businesses are buying big in Florida and the country’s economic forecast is expected to have a greater impact on the Sunshine State than ever before. The Miami Realtors Association says that Brazilian real estate investors were responsible for 15% of total real estate sales in 2011 and the Brazilian-American Chamber of Commerce reports that there are 15 Brazilian multinational corporations headquartered in Florida. The ties are becoming so strong that a faltering economy in the South American country could mean serious trouble for Florida. For more on this continue reading the following article from JDSupra.
Florida’s real estate industry – residential and commercial – is tied to Brazil in a big way: according to the Miami Realtors Association, as of last November, Brazilians were second only to Venezuela in foreign purchases of Florida real estate, with Brazil buying fifteen percent (15%) of the total real estate sales in 2011.
The Brazilian-American Chamber of Commerce (Miami) reports that there are 15 Brazilian multinational companies headquartered in South Florida, including Banco do Brasil, Odebrecht Contractors of South Florida, Embraer Aircraft Holding, and TAM Airlines.
In fact, Brazil’s ties with Florida are becoming so strong that Brazil, currently ranked as the 6th largest economy on the planet, is impacting everyday life here in Florida — for example, right now there is a push to have Portuguese taught in the Broward County Public Schools, since Brazilians speak Portuguese – not Spanish – and Brazilians businesses and investors (as well as Brazil’s many tourists visiting here) need more Portuguese-speaking Floridians.
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Which is why Florida real estate investors and Florida land developers are carefully watching what’s happening right now with Brazil’s economy.
This month, there are news reports and studies being released that do not bode well for the economy of Brazil. Consider these items:
- In June 2012, the confidence of Brazil’s consumers fell. According to Reuters, this was for the second month in a row with reports that Brazilians are not optimistic for how their country will fare for the remainder of the year.
- Brazil’s Central Bank released its survey where economic forecasts for the rest of 2012 were cut for the 7th week in a row. The economist are forecasting the weakest year for Brazil’s economy since 2009.
- Brazil is facing less demand from international trade at the same time that Brazil’s labor costs are rising.
- The Central Bank of Brazil is predicted to continue its pattern of cutting interest rates through the rest of the year, with talks that the rate may go as low as 7.5% – all in a strategy to fight against inflation.
What This May Mean to South Florida – Brazil’s Economy Influences Florida’s Economy
Florida and Brazil have built – and continue to build – an economic relationship and when Brazil falters, then Florida feels the effects.
The Brookings Institute ranks South Florida as one of the country’s most hurting economic areas (rank: 81 out of 100) and one of the factors here may well be Brazil’s influence according to local economic experts (read their opinions here).
It’s a great thing that Brazil and Florida – particularly South Florida, and especially Miami – have built a relationship that benefits both regions and it’s hopeful that this camaraderie will continue to florish. However, as with any relationship, there are ebbs and flows, and now Florida must consider not only what happens here but what happens elsewhere: for example, when Brazil’s sales in the global marketplace fall – as has happened recently – then Florida will feel this, too.
This article was republished with permission from JDSupra.
