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(10-year) financing upon handing over of the keys. However,
homeowners who sign on right from the outset of a project can
spread their payments out over an additional 36 months (3
years); a duration that corresponds to the construction period.
Aside from increased payment options, the company also dis-
tinguished itself by the way it administered its profits. Instead of
doling them out amongst its shareholders, Habitare’s directors
made it a policy to funnel the majority of profits back into the
company. “As a result, we’ve always had a lot of capital avail-
able to invest in new projects,” explains Soares. “We’ve been
able to continuously buy new lots and increase our volumes.
Unlike many of our competitors, we don’t depend on sales to
raise capital. We always have our own reserves at our disposal
to purchase land and finance our own construction.”
This strategy proved propitious during the 2008 global finan-
cial crisis. Bucking conventional wisdom, Habitare’s board of
directors made a decision to neither halt nor significantly reduce
its projects. “Due to the economic environment there was a slow-
down in sales,” admits Soares. “But since our debt is so small, this
wasn’t a problem for us. The following year, when the Brazilian
economy bounced back, we experienced a major jump in sales
because, unlike our competitors, we had never reduced our activ-
ities. In fact, the manner in which we came through the crisis only
served to boost both our products and our brand name.”
Indeed, in recent years, Habitare has enjoyed tremendous
growth rates that average around 50 percent a year. In 2009, the
company took in R$180 million (roughly US$100 million). This
year, revenues are expected to exceed R$250 million (US$140
million). Since it first started out over 20 year ago, the company
has completed a total of more than 50 buildings. Currently, it has
30 buildings in various stages of construction; proof that busi-
ness is booming. Aside from its main administrative headquar-
ters in the downtown neighborhood of Barro Preto, Habitare also
has four branch offices scattered throughout the city, which were
opened in an attempt to facilitate personalized contact with
clients, both pre- and post-sales.
“We cater largely – around 90 percent – to the Classe B,”
explains Soares, referring to the socio-economic term used to
categorize Brazil’s upper-middle class. “When we first began
constructing buildings, we observed that this was a niche that
really wasn’t being exploited, and there was not a lot of compe-
tition in the marketplace. Our clients demand high-quality prod-
ucts and we work hard to meet their demands.”
For instance, Habitare hires different architects for each of its
Pictured above (from left): Three and four bedroom apartments in Ouro
Preto and Buritis.