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Rio de Janeiro to have a R$2.3bn Mariott hotel complex

The project, however, still depends on environmental permits

01/17/2023

Maraey — a tourism-residential project run by foreign investors in Brazil — has reached an agreement with Marriott International to build three hotels on the property, located in Maricá, Rio de Janeiro state. In total, R$ 2.3 billion in investments are planned for the three structures. With the agreement, the U.S. hotel chain promises to launch the Ritz-Carlton Reserve luxury brand in South America.

Maraey is devised by IDB Brasil, a company that owns 840 hectares of land and will own the hotels. The company is formed by a group of Spanish, Brazilian, American, and Chinese businessmen, led by the Cetya and Abacus groups. Their activities are mainly in construction through the development of real estate and hotel projects. The company in charge of the construction is still to be defined.

The plan is ambitious, since the Brazilian hotel market has difficulty attracting large luxury brands due to issues such as exchange rates and unprofitable tariffs. In Rio, one of the main luxury brands today is Fasano, which is national.

It was only last year that Marriott brought the first JW Marriott unit to Brazil — opened in São Paulo, in the building formerly occupied by the Four Seasons. The company will also give its name to one of Maraey’s hotels. The Rio de Janeiro version of the JW Marriott will be one of the first of the hotel group to adopt the “all-inclusive” model (tourists pay a daily rate that includes all expenses inside the hotel).

A theme hotel called Rio Autograph Collection is also planned, the first with the Rock in Rio music festival brand.

The hotels will have more than 1,100 rooms altogether, all operated by the U.S. giant. Maraey’s final project foresees one more hotel, which is still under study.

“In association with the hotels, we foresee the offer of 244 exclusive branded residences (villas, duplexes, and apartments),” Emilio Izquierdo, Maraey CEO, told Valor. In total, 80 will use the Ritz-Carlton Reserve brand and the rest will be under the JW Marriott brand.

“We are creating a unique tourist destination in this strategic market for us, which is Brazil,” says Laurent De Kousemaeker, head of development for Marriott International. The forecast is to start construction in the second half of this year. The group is now seeking permits from the Environmental Institute of Rio de Janeiro and a construction permit from the city hall.

Mr. Izquierdo said that after the agreement with Marriott, the group will launch in the next months a hotel real estate fund focused on qualified investors to raise funds. The idea is to also seek international contributions. About 40% of the project should be raised through the fund, and the rest will come from debt. “We are studying the support of banks such as the development bank BNDES and IDB, and we also believe in the support of other financial institutions”, he said.

According to De Kousemaeker, the luxury lodging sector in Brazil is still evolving. “In markets where we do not observe an oversupply problem, we already see potential to induce new demand and some luxury hotels achieve high rates in local currency, when compared to other destinations in the region,” he said.

Despite its natural beauty and strong culture, Brazil has been unattractive to international tourism. According to data from the World Tourism Organization, Brazil ranked number 49 in 2018 in the number of international tourists, with 6.6 million. France, which leads the ranking, received 89 million that year.

The entire Maraey project encompasses 840 hectares, 6.6% of it with buildings. The total private investment will be around R$11 billion. The idea is that it will become a true luxury city, with more than 8,000 high-standard homes and services.

*By Cristian Favaro — São Paulo

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Joint auction of airports is opportunity for Rio

Rio de Janeiro: Aeroporto Galeão ou Santos Dumont?

The joint bidding of Santos Dumont and Galeão airports in the second half of next year is positive not only for Rio de Janeiro state, but for the civil aviation system in Brazil as well. There is enough time to design a model for the auction of both assets in 2023. This is the view of experts consulted by Valor, according to whom the auction is possible next year even with a possible shift of government. According to them, the merger of the two airports into a single block will create a system capable of strengthening the city as a hub of internal distribution, without running the risk of increasing fares.

The decision to auction the two airports in a single block in 2023 was announced on Thursday evening by Infrastructure Minister Tarcísio Freitas after the RioGaleão concessionaire, whose controller is Singapore’s Changi, confirmed it had requested the re-bidding of the airport.

For Delmo Pinho, former Secretary of Transportation of Rio de Janeiro and representative of the commerce federation Fecomércio-RJ in the working group that discussed with the federal government the model for the Santos Dumont tender, “it is very bad for the country when a major international operator leaves” a concession. However, Mr. Pinho says that the departure of Changi from Galeão has created a more favorable scenario for Rio to become a relevant hub once again in national civil aviation.

“The new owner of the concession will not shoot himself in the foot, and the result of this can be excellent for Rio and for Brazil. We will have a major competitor in a very important market, which is Rio, and working in a cooperative way”, he says.

According to Mr. Pinho, it is possible to bid the two airports together in the second half of next year even considering the election of a new president. “Nobody will change a modeling that is consensual and well accomplished,” he says, adding that a barrier clause is needed to prevent the participation of concessionaires of assets such as Guarulhos, Viracopos and Brasília in the auction. “We have to impose barrier clauses to avoid a private monopoly.”

Lawyer Luiz Felipe Graziano, partner at Giamundo Neto Advogados, says that the bidding next year is “totally feasible”, even with the dependence on further steps to be taken, such as public hearings and the analysis of the public spending watchdog TCU. “The fuel for making this bid feasible is the convergence of interests,” he says.

Mr. Graziano reminds that the airport assets concession initiative started to be modeled and carried out still in the administration of former president Dilma Rousseff, went on through the Michel Temer term and continued in the Jair Bolsonaro government. “As this went through three administrations with very different profiles, it is possible that the project will survive a change in the presidency.”

Maurício Menezes, partner of the Moreira Menezes Martins law firm, says that uniting the airports will be “a solution in the end,” but ponders that there is a need for a “very broad” dialogue with the private initiative. “It is an opportunity to reflect on the best way [to do the modeling] not only from the public sector’s perspective, but mainly from the private point of view.”

Source: Valor International

https://valorinternational.globo.com

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