By Michela DellaMonica, Contributing Reporter RIO DE JANEIRO, BRAZIL — While there is no question the property market in Rio, especially Zona Sul (South Zone), has exploded in the last five years, there continues to be some doubt about where the ceiling is, or if a bubble scenario has arrived. One segment of the market likely to remain insulated is the very high-end luxury penthouse apartments, where Indigo Investments, run by British expatriate James Lomas, has focused. Four bedroom penthouse on Rua João Lira in Leblon, photo courtesy of Indigo Real Estate Investments. Mr. Lomas first came to Rio in 2007 and quickly launched Indigo Real Estate Investments. They were initially attracted by what they perceived as a relatively low cost of property, favorable exchange rates to the British Pound and of course – Rio de Janeiro itself. Regarding the changes in the marketplace, Lomas explains, “Before 2009 you could really just cherry pick good opportunities as there were so few people doing it. My first [investment property] project had been for sale for eighteen months before I bought it, today it would be sold almost immediately.” The real estate market has indeed drastically changed since 2009 with a market hitting sky-high levels fueled by a then-booming economy and excitement over the World Cup and 2016 Olympics Games. “More people became aware that developing properties or even buying apartments in Rio was a viable investment opportunity, which led to a lot more competition in the market thus becoming more difficult to buy an apartment,” says Lomas. One of Indigo Investment’s first properties is a stunning four-bedroom penthouse apartment on Rua João Lira in Leblon. With wall-to-wall windows, full wrap-around outdoor patio, views of both the ocean and Christ the Redeemer, as well as pool and second floor master-bedroom (with access to a separate hot tub), it would be hard to find a more a more impressive place to call home. “It was a great project to do as the building was totally derelict when I bought it and so to turn it into such a fantastic apartment was pretty satisfying,” explains Lomas. “It was also the first project that I did in Brazil so I was just pretty pleased with getting through the whole building process without many problems and of course a pretty steep learning curve.” Glass walled pool in the Rua Rainha Guilhermina penthouse, photo courtesy of Indigo Investment. Today Indigo is dedicating their efforts towards finishing the renovation of another penthouse in Arpoador as well as building a five-bedroom house in Jardim Pernambuco in Alto Leblon. “At the moment [we are] renovating a four-bedroom penthouse in Arpoador which should be finished in a month’s time, after that I’ll be building a house in Jardim Pernambcuo in Leblon which will also be for sale, this will take another couple of years, after that who knows, work will be dictated by where the market is if there are any new opportunities.” The process involved in finding the projects requires time and a strategic approach. “The properties that we buy are quite specific, they have to be in a good location but also in very bad condition, this is very important as it keeps the price low,” says Lomas. “We always strip the apartments back to the shell and effectively start again so the condition isn’t a problem, in fact the worse the better.” However, the main factor in choosing a place is value for the price, which has to allow for some profit margin. Another key for success is investing in good architects which Lomas takes pride in doing. For projects to remain in line with budgets and deadlines, going with seasoned professional architects provides less of a risk. “We use the very best architects and contractors and have an outstanding local knowledge and network in all areas that we operate,” states Indigo Investment. In terms of anyone looking to approach this part of the market, Lomas shares some tips for finding a property to develop, “The apartment must also have the right ‘feel’, once you see a few you can picture how it will look after you’ve renovated it and how you can improve it. However the main factor is price. I’ve never paid more than R$6,500 per square meter for anywhere as it just isn’t viable as [a development] investment.” 2 Responses to "Developing Luxury Penthouse Apartments in Rio" Pingback: Brazil Real Estate Growth Dips Below Ten Percent | The Rio Times | Brazil News Pingback: Star Architect Zaha Hadid Plans Building in Copacabana | The Rio Times | Brazil News Leave a Reply Cancel Reply Your email address will not be published.