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Issue Nº 9 ::

April 2014

Prime Retail

• Liberdade Luxury • Opportunities in Paraguay • Smart Shopping • Cartier • Cerro da Borrega • Freeport


global travelling.*

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INDEX

04 • Portugal out of the woods? 06 • Back to the bonds markets 10 • Researching cancer in Lisbon 14 • Partners News

20 • Foreign Investment: attracting capital back to Portugal 21 • Thema hotels: Iconic sanctuaries of art and fine living 22 • Cartier: an international style icon opens in Lisbon 24 • The renaissance of Lisbon’s Avenida da Liberdade 26 • Freeport: where the smart people shop 30 • Lisbon Commercial Market: tangible signs of recovery 32 • Why luxury shopping is improving Lisbon’s international image 34 • Cerro Da Borrega: an idyllic Alentejo retreat 36 • Paraguay: the new frontier for Portuguese investment? 38 • RockBuilding – helping the homeless 40 • Nuno Crato at the International Club of Lisbon 42 • Adolfo Mesquita Nunes at the British-Portuguese Chamber of Commerce 44 • In Retail Congress 2013 46 • Cars 50 • Stories of Luxury: Using the power of stories in brand building DIRECTOR | Luis Figueiredo Trindade • lft@partnersinbusiness.info COMMERCIAL DEPARTMENT | geral@partnersinbusiness.info EDITOR | Chris Graeme • chris@partnersinbusiness.info DESIGN CONCEPTION | André Freire • David Martins DESIGN DEVELOPER | Alice L.C TRANSLATION | Chris Graeme PHOTOGRAPHY | Chris Graeme ILLUSTRATION | Cover page by Bruno Moinard, CEO and Interior Architect at 4BI PRINTER | Finepaper, Lda (Lisboa) – nº DL: 341143/12 DISTRIBUTION | 3,000 are distributed by hand to leading business people in the Greater Lisbon area, 1.500 copies are distributed by post internationally and 500 copes at the national and international trade fairs, events of the Chambers of Commerce. Prime Retail | Issue Nº 9 – April 2014 Published quaterly and owned by Bravespiral – Comunicação, Unip. Lda. Rua Sarmento de Beires n.º 35 C | 1900-411 Lisboa | 21 84 716 16 Registo na ERC nº 126184 | Annual subscription fee: 25 euros / Bi-monthly www.partnersinbusiness.info Reproduction of material in this magazine in any form is prohibited without prior written permission from the Partners in Business team. The view expressed in this magazine is not necessarily those of the publisher.

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[ EDITOR IAL ]

2014

THE TURNING POINT

L

LUIS FIGUEIREDO TRINDADE | Director, PARTNERS IN BUSINESS

We’ve now entered a new era where the light at the end of the tunnel can be seen and as the exit of the ‘Troika’ from Portugal comes closer...

ooking back some years ago, in 2007 we lived through the year of the Sub Prime, with very low interest rates, central bank supervision that was very weak and a portfolio of real estate assets held by the banks that was widely accepted as rotten. Credit for construction and housing represented 40% on average of total financing. In 2008 Lehman Brothers collapsed with all of its systemic consequences, lack of market liquidity and the need for capital injections from the central banks into the financial system. Then came the third phase in the economic crisis – market deleveraging. In 2010, as the economic crisis spread, the sovereign debt crisis set in, in which Ireland, Greece and Portugal had to seek external aid. With the impairments felt by the banking sector, the banks were forced to recapitalise despite the fact that in 2010 the demand for credit fell to historically low levels, but the losses kept on soaring and in no small measure. The banking sector, with a portfolio of real estate assets it had never had before, tried to reschedule its loans, extending payment deadlines, and handing many over to funds to manage, in many cases accepting their losses given the necessary adjustment in real estate assets that followed. We’ve now entered a new era where the light at the end of the tunnel can be seen and as the exit of the ‘Troika’ from Portugal comes closer, successful attempts to again borrow money on the international markets, the control of our balance of payments deficit and incentives for our economy – namely attracting foreign investment with the creation of funding mechanisms so that the banking sector can finance our economy in a more sustainable way – creating wealth for the Portuguese so that later on a new chapter for brand-new construction and rehabilitation of our cities can begin at a price that meets the needs of the Portuguese. According to the real estate consultants, Aguirre Newman, Cushman and Wakefield and Jones Lang Lasalle this year will represent a turning point for the real estate market where demand for investment will take off in the residential and office markets, demand for luxury brands in prime locations will be the exception for retail, office rents in prime areas will remain stable as the market sends out signs of recovery from the presence of foreigners looking for opportunities to invest. Jones Lang LaSalle increased its business turnover in 2013 by 30%, Aguirre Newman grew even more, turning over €5 million in the same year, while Cushman and Wakefield maintained its turnover levels, but all have an expectation for growth in 2014, which all add up to positive signs for the real estate market.

4 | Prime Retail


[ SPEC IAL R E P ORT ]

BACK TO THE BONDS MARKET With its budget deficit below five per cent, unemployment down a further 2.8 per cent and the ‘troika’ expected to leave Portugal this summer after two and half years of intervention, Portugal looks set to regain its financial independence by returning to the bonds markets. But can she fully fund herself without the need for interim financial support asks Chris Graeme?

P

CHRIS GRAEME | Editor

ortugal is set to become the second country in the eurozone to exit the €78bn bailout programme it was forced to take in the first half of 2011, which led the collapse of the socialist PS José Sócrates government and the election of the centre-right PSD-CDS-PP coalition government headed by Pedro Passos Coelho and Paulo Portas. Portugal’s economy, which enjoyed a credit and construction boom from the 1990s until 2007, needed the emergency measures because its revenue, partly in terms of direct foreign investments, plummeted, while borrowing expenses and overall expenditure increased in the wake of the financial crisis from 2010.

institutions were effectively able to take control of Portugal’s economy, enforcing a round of cuts, reforms and austerity measures on an essentially puppet government in Lisbon which has been immensely unpopular with a population already hard-hit by a Europe-wide recession. On January 9th, taking Ireland’s lead, Portugal tested the international financial markets by selling its first long-term bond issues by putting €3bn of five-year bonds onto the markets.

In May 2013 the Portuguese state had raised €3bn in its first 10-year bond sale since requesting the bailout two years prior to that. The new bonds, which attracted €10.2 billion in orders from investors, yielded 5.6% - one of the highest rates in the eurozone but much lower than in 2011 when Portugal was The cash supplied from the ‘troika’ of essentially closed out of the bonds market international lenders (International because investors demanded such high Monetary Fund, European Central Bank and returns (over seven per cent yields) for the European Union) came at a price. The three risk of buying its debt. This time the five-year 6 | Prime Retail

bond issue achieved the Government’s target of €3.25bn on what Portugal’s finance minister, Maria Luís Albuquerque trumpeted “very significant demand” that exceeded €11Bn – over the Government’s €10.5Bn expectations. Portugal’s debt agency, the IGCP (Agência de Gestão da Tesouraria e da Dívida Publica Portugal) stated that the bond issue offering an interest of 4.89% “enjoyed particularly strong take-up from international real-money investors”, including 16 per cent from insurance and pension funds while 88 per cent came from foreign investors which had remained shy of Portugal. According to João Moreira Rato, president of the IGCP, Portugal needed to find €7Bn in 2014 from external sources, but with January’s bond issue the amount to be found has fallen to €3.75Bn not to mention other sources of finance such as the new Treasury Certificates. The 4.89% interest rate that Portugal has to


The big question now is whether Portugal can exit the bailout programme this summer and brave the waters of the international markets alone, or will need some kind of interim ‘tide-me-over’ financial assistance or precautionary lending programme… helping eurozone countries in difficulty - but which both the Portuguese government and the ECB hope will never prove necessary in practice. Even so, the access conditions to the OMT have never been wholly clear, and furthermore, the ECB has always stated that the country must have access to the debt markets in order to qualify and would have to negotiate an interim financial support package or a new bailout with fresh strings attached. The big question now is whether Portugal can exit the bailout programme this summer and brave the waters of the international markets alone, or will need some kind of interim ‘tide-me-over’ financial assistance or precautionary lending programme, something that Ireland refused, choosing instead to make a clean break from the assistance programme.

pay on January’s debt issue is less than the last five-year debt auction in 2011 (6.4% rate) but slightly more than December’s operation (4.68%). Both senior government figures and analysts across the board said that the success of the bond issue proved that Portugal was moving in the right direction towards restoring a sustainable market while the chief spokesman for the European Commission, Simon O’Connor said it reflected how Portugal has strictly stuck to its bailout programme.

In the second half of last year, after a Government crisis was triggered with the exit of former finance minister Vítor Gaspar and the resignation threat of the leader of the CDS-PP party coalition partner and foreign minister at the time, Paulo Portas, not to mention a wave of opposition from Portugal Constitutional Court to controversial state pension reforms, the question was asked whether Portugal, like Greece, would require a second bailout programme. That threat seems, on the face of recent months, to be diminishing. After sliding for 10 consecutive quarters, Portugal’s Gross Domestic Product (GDP) started growing modestly in the second quarter of 2013 (1.1%); in the third quarter growth continued, albeit at a more timid rate (0.2%). In like-for-like terms for the same period in the previous year, GDP fell, but economists expect that overall Portugal will have been back in positive territory

Portugal’s Prime Minister, Pedro Passos Coelho, too said after the bond issue’s success that the country now had to “continue taking advantage of such opportunities” to be able to prove that it can exit its assistance programme and return to the markets. “It’s a process, we’ve had a good start and this is important,” he said. Analysts now say that the next step for Portugal is to press forward with issuing 10-year treasury bonds. “This represents a great success for Portugal, especially coming as it does before a ratings agency review and the meeting of the Eurogroup/Ecofin on January 27th/28th”, agreed David Schnautz, an analyst for Commerzbank, in New York. The success of December and January’s operations could now pave the way for Portugal to access, if necessary, the European Central Bank’s Outright Monetary Transactions Programme (OMT) – a sovereign debt purchasing programme aimed at |7


[ SPEC IAL R E P ORT ]

Many analysts, and quietly even some members of the government, admit that Portugal will need a financial parachute in the form of an interim financial support when the ‘troika’ leaves Portugal in the summer.

US TREASURY SECRETARY PRAISES PORTUGAL’S EFFORTS

The United States signalled in early January that it was willing to support Portugal’s return to the bond markets. In a whistle-stop visit to Lisbon, Jacob Lew, the Secretary of State for the Treasury, said that the US would help Portugal’s bid to return to self-financing on the international money markets at accessible prices, as well as contributing towards a post-‘troika’ “sustainable growth level model”. In a joint press conference, following talks with the Portuguese Prime Minister, Pedro Passos Coelho, the Vice Prime Minister, Paulo Portas and the Minister of Finance, Maria Luís Albuquerque, both finance ministers stressed the importance of the close cooperation between the two countries. The Treasury Secretary for the Obama government arrived in Lisbon following visits to Berlin and Paris in what was the first visit by a United States treasury secretary to Portugal. The European visit by the treasury secretary aimed to encourage European partners to play a bigger role in the global recovery and not obsessively follow austerity measures to the detriment of growth.

when figures are released for the end of 2013. The European Commission too anticipates a return to growth for the peripheral EU countries, including Greece, in 2014, and predictions for Portugal point to a GDP increase of 0.8 per cent after a 6.3 per cent accumulated contraction between 2011 and 2013. The signs that the tide is turning is backed up by a reduction in unemployment which in November fell to 15.5 per cent according to Eurostat, a trend which continued in December (down a further 0.2%). Opposition parties, however, say that unemployment figures are still historically high in Portugal and much of the reduction in unemployment is really down to the fact that over 100,000 Portuguese, many of them highly qualified, have emigrated to other countries both within the EU (Germany, Holland, the UK and France) and outside the EU (mainly Angola and Brazil). Despite the optimistic growth figures, falling unemployment and two successful bond issues within two months, ‘one swallow doesn’t make a summer’ as the expression goes and many analysts, and quietly even some members of the government, admit that Portugal will need a financial parachute in the form of an interim financial support when the ‘troika’ leaves Portugal in the summer, unlike Ireland which emerged from financial assistance without the need for further aid. For the time being, Portugal’s Prime Minister, Pedro Passos Coelho, has restricted his comments to stating that “Portugal should continue to make the most of opportunities” in returning to the markets to show that it can successfully terminate the bailout programme. A lot depends on Europe’s continued economic recovery and Portugal’s ability to supplement export successes with an ability to attract Direct Foreign Investment. Only time will tell.  8 | Prime Retail

However EU member states have been at pains to clear up what they say is a misunderstanding that eurozone countries are only “fixated on austerity”, as the Dutch Finance Minister, Jeroen Dijsselbloem, put it to journalists at the World Bank and International Monetary Fund in January. He had said before the Lisbon meeting that the EU would slow down the pace of debt-cutting efforts to meet challenges, allowing struggling EU countries like Portugal more time if necessary. The US Treasury Secretary issued a statement saying that weak domestic demand had undercut the eurozone’s efforts to return to growth. Jacob Lew added that it was vital for export-orientated economies to “step-up to protect Europe from being crushed by its austerity strategies.��� In his joint statement with Maria Luís Albuqurque, he admitted that Portugal had made “remarkable progress” through difficult economic reforms. Portugal’s growth and exports were “indicators of recovery” he said at a short press conference at the Ministry of Finance in Lisbon.“ We know they (the Portuguese) are working hard to have a sustainable growth and prosperity for future generations” added the U.S Treasury Secretary. Maria Luís Albuquerque described the meeting with her counterpart as an “excellent opportunity” to exchange views on the latest developments of the two economies, adding that the closeness between the two nations was of “particular importance at the present moment, at a time when Portugal was preparing to complete the economic adjustment programme”.


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[ PA RT NE R S SPE C IAL FE AT U R E ]

THE CHAMPALIMAUD CENTRE FOR THE UNKNOWN Cutting-edge biomedical research and cancer treament facility on the banks of Lisbon’s River Tejo

S

een from the outside, the ultra-modern architecture of the Champlimaud Centre for the Unknown looks almost other worldly, set within a river-side landscape featuring the 16th century Torre de Belém. Designed by Goa-born architect Charles Correa, in what was to be his first project in Portugal, the architect explained at the centre’s inauguration ceremony that “this project uses the highest levels of contemporary science and medicine to help people grappling with real problems. And to house these cutting-edge activities, we tried to create a piece of architecture as sculpture, architecture as beauty and beauty as therapy.”

CHRIS GRAEME | Editor

Built in just two years and inaugurated in 2010, the Champalimaud Centre for the Unknown is a state-of-the-art research facility which develops biomedical research activities in Portugal. Chris Graeme joined a guided tour of the centre with the BritishPortuguese Chamber of Commerce to find out more. 10 | Prime Retail

After a two hour tour of the facility, certainly the most impressive and futuristic one I have seen in my life, I for one felt sure that his aims had been realised and was impressed that a small country of just 10 million inhabitants on the periphery of Europe, so often in the world’s press for the wrong reasons in recent years, was, in this calm riverside Lisbon setting, contributing to making small, steady, but hugely significant steps in the fight against certain cancers and neurological problems. Starting our tour in the Auditorium with a brief introduction to the mission and activities of the Champalimaud Centre for the Unknown, our guide, Maria João Villas-Boas, Public Relations and Executive Consultant of the Board of Directors, explains that the flags of the many nations in the foyer represent the 30 different nationalities working at the centre. Our host also points out the ramp between the two main buildings which represents going into the unknown.

HOW THE CENTRE GOT STARTED The history of the Champalimaud Foundation begins with the Portuguese entrepreneur, financier and industrialist, António de Sommer Champalimaud, who decreed that following his death part of his fortune should be used to create an international project in the field of biomedicine.


The building was designed to break down barriers by interlinking the different areas to promote discussion and collaboration between the scientists, clinicians and other professionals

In his will Champalimaud appointed the former Portuguese health minister, Leonor Beleza as President of the foundation who, together with the tycoon’s friend and lawyer, Daniel Proença de Carvalho, set about creating the foundation’s statutes, leadership and direction. The board of directors then actively sought the advice of individuals and institutions in the science and medicine fields, creating a network of friends, contacts and advisors, as well as commissioning a study on national and international disease prevalence. Two fields were chosen in which the foundation’s actions could make a difference: oncology and neuroscience. A third area – blindness prevention – research for which is not carried out at the centre now was also chosen because of its significance to the developing world.

THE CHAMPALIMAUD CENTRE FOR THE UNKNOWN SITE Built on derelict riverside land on the 65,000m² site of the former Fishing School at Pedrouços near Belém, the place for the complex seems aptly chosen – for it was within sight of the Torre de Belém where in the 16th century Portuguese explorers set off into the great unknown to discover new routes to new worlds overseas. Apt because the research and work carried out by scientists here also is a journey into the unknown to discover new knowledge that could eventually lead to treatments for certain cancers and neurological illnesses. The site comprises three large areas – the main building houses the Champalimaud Clinical Centre’s diagnostic and treatment facilities, an indoor garden, research laboratories and

administrative services. “The building was designed to break down barriers by interlinking the different areas to promote discussion and collaboration between the scientists, clinicians and other professionals,” explains Maria João Villa-Boas who also points out that once a year they go on retreats to places like the Alentejo where they can discuss research and problems in a relaxed and informal environment. One of the most beautiful aspects of the entire Clinical Centre is the giant open-air tropical pergola covered garden in the middle of the structure. This is – like some of the areas we saw, including the main foyer and reception, the Darwin’s Café, Auditorium, Exhibition Centre and even the Chapel with the most amazing organic sculpture representing Christ – open to the general public and it is here that patients undergoing cancer treatments can relax, stroll with friends and family members and even undergo chemotherapy sessions in special cabins in a more informal and less daunting environment. In addition to this green

oasis, member of the public can also enjoy green riverside areas along the river bank itself which are perfectly integrated into the surrounding area. There is a public footpath leading to this area which rises slowly – called the Ramp to the Unknown – revealing a view of the sea, the open air amphitheatre, and the Infinity Pool.


[ PA RT NE R S SPE C IAL FE AT U R E ]

policies and accepts referrals from state-run hospitals for patients of more modest financial means.

BENCH TO THE BEDSIDE Given the scientific nature of the centre, and the fact that patients receive treatment within the building, it comes as no surprise that for privacy and work reasons certain areas are off limits to the general public. We did, however, get to see one neuroscience laboratory area with its myriad benches, files, glass dishes and flasks of every conceivable shape, size and colour, not to mention a rather amusing yellow shower in the lab itself for “decontamination purposes.” Outside this lab it was noted that the walls in the corridor were partly made of white class which ingeniously double up as writing boards for the researchers and are well used judging from the frantic scribble of unintelligible equations on them – unintelligible to the likes of me that is! In the pristinely clean white open-plan corridors are comfortable sofas where researchers, staff and clinicians can meet and chat in an exchange of information and ideas, which is the whole point of the concept and the envy of many other research facilities around the world. It is also interesting to note that the centre breeds swarms of fruit flies because they are easy to genetically manipulate, as well as shoals of zebra fish because they have a rare ability to regenerate their fins, skin, heart and brain, while their spinal cords have an amazing capacity to heal without scarring – obvious neuroscientific applications here. But the main beauty of the entire set up for me is the fact that scientific investigation in the laboratory is linked to the patient’s bedside, since central to the foundation’s main mission is the 12 | Prime Retail

EARLY DIAGNOSIS AND PREVENTION concept of translational research. Cancer research here is focused on achieving breakthroughs which can be brought into the clinic to improve the treatment and diagnosis of oncologic disease. Clinical staff offer patients at the centre the option of participating in studies or research programmes designed to create innovative new diagnostic and treatment solutions and a number of clinical trials are already underway. For example, the Champalimaud Breast Unit has over 10 trials ongoing or in the process of approval. There are clinical trials also going in the radiotherapy department which has two customised calibrated equipment from the United States specially made for the centre. There has been the incorrect assumption that only those with private insurance from private hospital referrals can benefit from the work and treatment here. Nothing could be further from the truth. The centre is open to most of the main health insurance

One difficult and sensitive point in today’s treatment of cancer is health screening for early detection which is vital in cancer but comes up against issues such as privacy and personal choice. The foundation has an innovative portfolio of patents that will enable the creation of new approaches to early cancer diagnosis and precise prediction of individual patient outcome. The technology made for the centre can provide single-dose therapy (one to three sessions) rather than 10 to 20 individual treatments, while particular emphasis is placed on research into the metastasis process. In oncologic disease it is not generally the primary tumour that kills the patient but the secondary tumours that follow. It was this concern that led in 2009 to the Champalimaud Metastasis Programme (CMP) in partnership with Princeton and Cornell universities. Above all Maria João Villas- Boas stresses that “we cannot (always) say that we can cure people of cancer. We are trying to turn cancer into a chronic, manageable disease.”


We cannot (always) say that we can cure people of cancer. We are trying to turn cancer into a chronic, manageable disease.

BLINDNESS PREVENTION Despite research in this area not being carried out at the centre, it was in this field that the foundation was to the launch its first direct action in 2006. Awarded on an annual basis, the €1,000,000 António Champalimaud Vision Award is the largest prize in the field and supports the fight against blindness from two sides: laboratory based research and blindness prevention work in the developing world and funds small teams of specialists with mobile operating equipment who go into remote areas in places like Nepal and treat problems such as cataracts which so often cause unnecessary blindness in developing countries. In 2008 the foundation opened its first vision centre: C-Tracer – the Champalimaud Centre for Translational Eye Research which promotes advanced research in the field of ophthalmology at three centres in India, Portugal and Brazil.

CHAMPALIMAUD NEUROSCIENCE PROGRAMME (CNP) Starting in 2007, the foundation launched the Champalimaud Neuroscience Programme (CNP) which was initially hosted at Lisbon’s Gulbenkian Institute of Science. With the goal of unravelling the neural basis of behaviour and studying the human brain, the Neuroscience Programme (CNP) seeks to forge new links between nervous system function and behaviour, not by a particular field within neuroscience, but by the full intellectual scope of the scientists on the programme through maximising cooperation, being a hub for scientific interaction, sharing knowledge, and nurturing new scientific approaches.

AN INTERNATIONAL SUCCESS STORY IN EIGHT YEARS THAT KEEPS GROWING Now in its eighth year, the Champalimaud Centre for the Unknown today has 15 research groups and employs 150 professionals – researchers, clinicians and scientists. It has won a fistful of awards and research grants totalling €20 million since its inception including €8 million in the past two years, a 2 million consolidation grant from the European Research Council in 2012 and a recently announced €2.5 million grant. In all areas in which it operates, the foundation is today recognised worldwide as a leader and promoter of knowledge and research.  | 13


[ PA RT NE R S NEWS ]

BRANDS CHOOSE CHIADO

to launch new concepts and debut in Lisbon Lisbon’s Chiado, currently the trendiest and busiest shopping destination in the capital, is increasingly the place of preference for brands to launch their new concepts or to open a high-street shop for the first time, an example of this trend being the three new shops which recently moved into this area, in

operations managed by Jones Lang LaSalle’s Department of Retail Leasing.

from a well-known Portuguese concept is to open in a 700 m² area at No12 Largo Bordalo Pinheiro, Lisbon. The Chiado will also L’Oréal Paris opened at the start of November, welcome the famous Cascais patisserie making a big impact with its new 180 m² “Sacolinha” in Lisbon, which will open its store in Rua Nova do Almada 109, the doors in Rua Paiva de Andrada, in a 120 m² cosmetic giant’s first Beauty Boutique in the which formerly housed the Haagen Dazs world. The third gourmet burger restaurant ice-cream parlour.

wins commercialisation contract in Italy

Sonae Sierra, an international specialist in shopping centres, has signed a contract for the commercialisation of the new La Perle shopping centre in Faenza, near Bologna, Italy.

create a commercial range of retail and service outlets to fit the profile and meet the requirements of future visitors.

The shopping centre, with its opening slated for the end of Via this service provision 2014, represents an innovative contract, Sonae Sierra will use its concept for an outlet of products know-how to develop and for the home and for families, implement a commercialisation with an offer focused on strategy for the 20,500m2 ABL decoration, in shops aimed at La Perle shopping centre, so as to families and leisure. 14 | Prime Retail

opens 1000m2 store at Freeport

Freeport has strengthened its offer with the opening of a new Nike store, in a 1000m2 unit. With the opening of the Nike store Freeport now has an even greater range of top sporting brand shops in Portugal, a segment that represents 16% of the outlet’s annual business turnover. Every month the brand changes its window display and begins a campaign focused on the running, training, sportswear and football segments.


@CINEMA

opens at Saldanha Residence with innovative concept

Cinema theatres return to shopping centres, positioning themselves as an important anchor for attracting the public Saldanha Residence, in Lisbon, will be home to the first @Cinema in Portugal, a new space which promises to revolutionise the traditional concept of the “cinema theatre” providing a state-of-the-art experience for cinema buffs. The operation for the renting

of the space – a total of 1,560 m2 means that cinema sessions are returning to this shopping centre in the heart of the capital, promising shoppers not only renewed dynamism but also increased footfall thanks to the innovative new concept that is making its début in Portugal.

PRAMERICA BUILDING sold to Swiss Investor AFIAA for €30 million

Cushman & Wakefield (C&W), the global real estate consultancy has announced the sale of two buildings held by TMW Pramerica Property Investment GmbH, a subsidiary of Pramerica Real Estate Investors, to the Swiss investor AFIAA for around €30 million. The two buildings, designed by the architect Mário Sua Kay and developed by Bouygues Imobiliária, are situated in one of the main arteries of Parque das Nações, Alameda dos Oceanos, next to FIL and fairly close to the Vasco de Gama Shopping Centre and Gare do Oriente station. The Espace building has 10,000m2 GLA and 250 parking spaces, while the Explorer building has 5,000m2 GLA and 108 parking spaces. The Explorer building also has a kindergarten and a restaurant.

RETAIL IN THE FRONT LINE Announces sale of Liberdade 108 for Espírito Santo Property to GLL Real Estate Partners GMBH for €10 million Cushman & Wakefield (C&W), the global real estate consultants, has completed the sale of Liberdade 108 in Lisbon for Espiríto Santo Property, sold to the German investor GLL REAL ESTATE PARTNERS GMBH for around €10 million. The building, which has undergone in-depth modernisation and repositioning, is in Lisbon’s Avenida da Liberdade, the most prestigious luxury office and commercial address in Portugal.

with accelerated demand for XXL Warehouses.Growth in on-line shopping is key element driving demand According to the latest study by the global real estate consultants CBRE, the redesigning of supply chains, driven by the rapid growth in on-line commerce, is contributing towards a significant increase in the demand for XXL warehouses (with an GLA of 50,000m2). These factors have increased the take-up levels of XXL warehouses in Europe to an area exceeding 4 million square metres in the 18 months since the start of 2012. This amount represents around 14% of the total industrial market, compared with 5.6% for the two previous years, between 2010 and 2011. | 15


[ PA RT NE R S NEWS ]

FERNANDO FERREIRA sells Valecenter & Airone shopping centres for €144.5 million The Sierra Fund, a panEuropean real estate fund in which Sonae Sierra has a 50.1% share, has sold its Valecenter (in Marcon, Venice) and Airone (in Monselice, Padua) shopping

centres to Blackstone Real Estate Partners IV and Blackstone Real Estate Partners VII) for €144.5 million, an amount in line with the recent independent asset valuations.

ESPART UNVEILS NEW CORPORATE IMAGE AND BEEFS UP INVESTMENT

appointed Director of Capital Markets at Jones Lang LaSalle Portugal Jones Lang LaSalle Portugal has hired Fernando Ferreira for the post of Director of Capital Markets, a business area that integrates service provision to the real estate investment market. The new director takes up his post in January, coordinating a team of three with the aim of increasing the department’s activity, which in 2013 was responsible for operations representing an investment turnover in the order of €30.1 Million.

Jones Lang LaSalle

is again voted one of the Best Companies to work for in Portugal Espiríto Santo Property (ESPART) has strengthened its investment in differentiated projects to meet new market trends. Espírito Santo Property is the new corporate identity of ESPART, the company that runs the real estate development activities of Rioforte in Portugal. Espirito Santo Property will head up a number of specialised subsidiaries in the areas of real estate development, real estate investment fund management, and the integrated coordination of real estate projects. Following 2013 which was a year in which the company 16 | Prime Retail

enjoyed busy commercial activity, Espírito Santo Property will develop two new projects per year. Slated for the beginning of this year is the launch of a new office and commercial building in Lisbon city centre. Regarding the residential sector, the company is bucking the recessionary trend, enjoying marked demand, taking into account the fact that quality real estate represents, at the present time, an alternative investment.

Consultants makes Exame magazine’s annual ranking list again Jones Lang LaSalle Portugal has once again, in 2014, been elected as one of the 100 “Best Companies to Work for in Portugal”, entering for the sixth consecutive year the ranking compiled by the magazine Exame and the consultants Accenture. This study is done annually and includes the 100 best companies to work for in Portugal, according to the degree of staff satisfaction.


Bruno Silva promoted to partner at Cushman & Wakefield (C&W) Hotel Casa da Calçada’s Largo do Paço Restaurant chef wins Chef of the Year

BNP Paribas Group) for four years.

ANDRÉ SILVA

wins ‘Chef of the Year’ André Silva is the winner of the Chef of the Year 2013 competition, the most important competition for chefs in Portugal. After having won the North/ Centre regional heat in June, the deputy-chef at the Hotel in Amarante got through to the competition final, where he showed all of his culinary skills and excellence in the last test that took place at the Lisbon School

of Tourism and Hotel Management (Escola de Hotelaria e Turismo de Lisboa). After having its Michelin Star reconfirmed, the award is another feather in the cap for the Hotel Casa da Calçada Relais e Châteaux which offers exclusive culinary creations in its refined restaurant, providing a unique gastronomic experience.

Cushman & Wakefield (C&W) has appointed Bruno Silva to the position of European partner at the consultancy. Before joining Cushman & Wakefield in 2008, Bruno Bastos Silva was the Ségécé’s Regional Director of Shopping Centres (Képierre –

The Lisbon office of C&W currently has 68 staff members and six partners. Cushman & Wakefield’s real estate management department headed by Bruno Silva has 33 staff members, with 42 office buildings and six shopping centres under its management, totalling more than 350,000m2 GLA and an annual rental turnover of €44m. Amongst this department’s portfolio of clients are Rockspring, JP Morgan/ Imopólis, Pramerica, Standard Life, Credit Suisse, Resolution and IVG, among others.

NELSON PACIÊNCIA ANNOUNCES DEFINITE AGREEMENT FOR THE PURHASE OF NORLAND MANAGED SERVICES LTD, BASED IN THE UK Norland specialised know-how in the engineering area, has significantly developed CBRE’scorporate outsourcing platform in the EMEA countries region adding strong skills to the management of premises in a critical environment.

provision in commercial buildings in the United Kingdom and Ireland for £250 million (€300 million), added to up to £50 million (€60 million) in deferred contingent offsets, excess payment of working capital and other related items.

CBRE has announced that it has signed a binding agreement to purchase Norland Managed Services Ltd (Norland), a market leader in technical engineering services

The purchase price will be paid in cash, apart from £5.6 million (€6.7 million) which will be paid for in ordinary CBRE shares to Norland management bodies.

appointed to strengthen CBRE`s building consultancy Department

CBRE, a global market leader in real estate services has appointed Nelson Paciência as its new Building Consultancy director for CBRE Portugal. Peciência took up his post in December 2013 with responsibilities for Architecture and Project Management and will be an asset in helping CBRE increase the services it provides its clients. | 17


[ PA RT NE R S NEWS ]

THE CONSUMER OF THE FUTURE IS STRONG ON TECHNOLOGY, LIKES PHYSICAL SHOPS AND WANTS A SHOPPING EXPERIENCE

Younger generation demand more from shopping centres CBRE surveys 10,000 Europeans to discover future shopping trends According to a new survey by global real estate consultants CBRE, the European consumer of the future likes to ‘feel and touch’ products before buying them, uses advanced technology and are looking for an entertainment experience when

shopping in shopping centres. Bucking the common perception, a visit to a store to ‘touch and feel’ the products is considered more important for the younger generation, with 86% of young adults (16-24 years) believing that a physical store is important for the

on-line shopping process. At the same time, this age band is a lot more savvy when it comes to digital technology than older generations and the probability of using blogs and social networks to evaluate products and compare prices is greater.

Growth in world commerce: more containers and cargo ships stimulate demand for warehouses next to European ports. The growth in global trade is contributing to an increase in the demand for warehousing and logistical premises close to Europe’s sea ports, says the latest research from Jones Lang LaSalle (JLL). 18 | Prime Retail

The report “European Seaports: the growing logistics opportunity” stresses the fact that patterns of maritime trade are changing – including an increase in the size of container ships and a greater

capacity for containers to hold cargo, not to mention changes in distribution channels – this is stimulating the demand for industrial and logistical premises by Ports.


LUXURY REAL ESTATE SEGMENT To manage edifício Étoile BOOMING 240 in Lisbon`s Avenida da Liberdade

Engel & Völkers presents two digit growth The German group Engel & Völkers, one of the world leaders in the luxury real estate sector, specialising in the sale and rental of premium properties registered strong growth in the first nine months of 2013. The Group’s profits on commissions rose by 18.5%, totalling €192.5 million (against €162.5 million for the same period in 2012). In Portugal, the growing interest of foreign buyers, allied to the trend for price stabilisation, has triggered greater confidence in the luxury market, leading to an

increase in interest from potential buyers and, as a consequence, successful business deals. The result has been a sharp increase in the number of properties sold in the first nine months of the year, as well as an overall rising trend in the turnover of sales. The renting of houses and apartments has equally registered a strong trend for growth in Portugal. Potential foreign investors frequently use this solution, with the aim of discovering the country and the region before investing.

The global real estate consultants Cushman & Wakefield (C&W) has been instructed to manage the edifício Étoile 240 building in the heart of Lisbon’s Avenida da Liberdade. Owned by Largetoile, the building has a total area (GLA) of around 1,800m2 of office space, boasts a 575m2 shop on the ground floor occupied by Cartier’s flagship store, and also features 28 underground car parking spaces.

THE BRAGA CLUB

Fitness Hut opened its 6th gymnasium in Braga at the end of 2013

The Braga club will have 1,900m2 dedicated training space. This FITNESS HUT is in one of Braga’s most emblematic premises in terms of architecture – Edifício Dynamic, in Av. Robert Smith, n.º 34.

FITNESS HUT is also preparing to open a further club in Lisbon –Picoas, for March 2014. Picoas with a 1,800m2 GLA is in the heart of Lisbon in Picoas Plaza, in Rua Tomás Ribeiro, n.º 65. | 19


[ PA RT NE R S OPINION ]

FOREIGN INVESTMENT:

a turning point... in two gears

F

MIGUEL MARQUES DOS SANTOS | Laywer and Partner, GARRIGUES PORTUGAL

oreign investment is an essential factor for the development of the real estate market of any country. Portugal is no exception. The time we’re going through now is a turning point (in the positive sense), albeit with a market reacting in two gears.

were essentially less institutional investors who were willing to take a risk (particularly European Family Offices and investors from economies with booming growth rates like Brazil and China), but more recently we’ve been seeing examples that confirm that European institutional investors, always more conservative, are also looking at Portugal, Things have been very positive in the with some relevant transactions in recent commercial real estate investment area (largely months. If the course followed over the past in part to investors from BRIC countries, two years is maintained (with improved particularly Brazil and China) and residential public accounts, improved external image of real estate investment (essentially because of the the country and implementation of the Golden Visa scheme). And all the indicators recently approved Corporation Tax reform), seem to point to things getting even better. then international investors will continue to have a positive opinion about the country, On the downside, in the real estate which will ensure the continuity of the development area (now mainly urban growth seen throughout 2013. renewal), developments have been much slower and harder (with some good examples, Along with this good news in terms of but these are the exception rather than the commercial real estate, 2013 also brought rule). While to ensure growth in the good news in terms of residential real estate, investment area the Government needs to with the appearance of a new investment follow its current course without making huge market in the residential area: the individual changes, in the real estate development area foreign investment market in residential real growth is less certain and depends on a estate. Portugal was able to create a new number of factors that could take some time market from scratch, based on a very well to achieve. Let’s take a look at each one in turn: structured Golden Visa programme, which has been developing and continues to enjoy INVESTMENT excellent growth potential. In 2013 total Since the beginning of the bailout in 2011, investment turnover has been of around very important steps were taken to stabilise €280m and the forecasts show that in the and bolster the country’s credibility, which coming years it is reasonable to suggest that have born extremely important fruits in terms investment turnover of €400m to €500m per of foreign investment in commercial real year is achievable. This new market will estate. After an abrupt fall in investment, enable Portugal to practically double its which plummeted from a high of around annual foreign investment turnover in the €1.4Bn in 2007 to a minimum of around €100 Portuguese real estate market (to an annual million in 2012, 2013 was a year of clear commercial real estate investment turnover of recovery, with estimates (still provisional) for around €700m-€800m, we will add now a investment amounts of between €300 and residential real estate investment turnover of €400 million. International investors are sitting around €500m per year), which well up and taking notice of the positive indicators illustrates the potential of this new market. in the Portuguese economy (reduction in the Here too the philosophy should be one of sovereign bond interest rates, positive external maintaining course. The Golden Visa regime balance of payments, notable recovery in has been well received by investors, available exports, end of the recession, lowering of assets are attractively priced and there are unemployment, etc.) and are once again seeing more and more areas of the world with Portugal as one of the potential destinations investors interested in securing an open door for their investments. At the beginning they into Europe and Schengen. 20 | Prime Retail

REAL ESTATE DEVELOPMENT (URBAN RENEWAL) In recent years, Portugal has made considerable strides in creating an auspicious environment for urban renewal. A very attractive tax regime was created and an urban renewal regime was approved which give local councils ample powers to create urban renewal policies (Lisbon Council has made considerable efforts to harness the potential of this regime), a new regime has been approved for undertaking improvement works on rented buildings and financial sweeteners were set up for urban renewal. All these conditions have created a solid base so that investors can develop their projects. On the other hand, the Golden Visa programme has also had a very important role in clearing out available property excess stock. But unlike the investment situation with regards to already built commercial and residential real estate, investment in new real estate development depends on factors (micro-economic ones) the success of which is by its very nature, slower. Factors such as availability of finance and the recovery of the home consumer market, that only now are starting to show some timid improvements, will from now on have relevant consequences in the recovery of the real estate development market. Foreign investment in real estate development can’t enjoy the same pace as investment in ready assets. In any case, real estate development opportunities are cropping up. And there is a fact that investors can’t ignore – the good projects are sold out. There are no doubts now that we are seeing a turning point, even if the market is operating in two gears. In the investment area, growth is now an evident reality and looks set to grow. In the real estate development area (especially urban renewal) change is still under way and, although it will surely take some time to happen, there are already attractive business opportunities out there which investors simply can’t ignore. 


[ BU SIN ESS INTE RVI EW ]

Miguel Júdice, Co-President Thema Hotels & Resorts

THEMA HOTELS & RESORTS

Always Unique

CHRIS GRAEME | Interview

Thema Hotels and Resorts is a brand which rests on the central pillars of tradition, fine service and quality. It has nine hotels in Portugal: the Infante Sagres Palace in Porto; the Bussaco Palace, Curia Palace, Quinta das Lágrimas Palace and Hotel Astória in Coimbra; the Hotel da Estrela, Hotel Métropole, Jerónimos 8, in Lisbon and Hotel Praia Mar in Carcavelos. Thema Hotels & Resorts is a brand that comprises two hotel groups: Lágrimas Group and the Alexandre de Almeida Hotels Group. What is the value added of this brand for the two groups with such distinct hotel products?

Sales grew by around 10%, which against a backdrop of economic recession is something that we view as very positive.

With the increasing value that Lisbon and Porto have as recognised and consolidated destinations internationally, who are your customers and what can you do to attract more tourists?

First, the brand that brings together the portfolios of the two groups enables us to gain dimension in an ever increasing competitive sector. This larger scale enables costs to be pooled and increases the visibility of the umbrella brand as well as the individual brands of each hotel.

Our customers are mainly foreign, from countries as varied as the United Kingdom, the United States, Brazil and Japan. Whilst having many international customers, in our hotels outside Lisbon and Porto we also attract a high percentage of Portuguese.

The heterogeneity of the hotel products is managed by the inclusion of some of the hotels in the Small Luxury Hotels of the World network. Second, they all have their own distinct communications and marketing.

What are the brand values of Thema Hotels & Resorts and what expectations do they create for the customer? They are essentially values associated with the tradition of hospitality in small and medium-sized hotels located in excellent places and in character properties. We’ve also got another distinct element which is a strong focus on cuisine and wines.

Currently Thema Hotels & Resorts is made up of nine hotels. Do you have plans to expand the brand? We’re analysing various projects and we’re interested in managing the existing hotels and those in development that require operational expertise.

Thema Hotels & Resorts are iconic sanctuaries of the art of fine living located in outstanding destinations around Portugal... Following the creation of this brand, what was the impact in sales for the past year relative to your take-up rate and average price per night?

Regarding your Food & Beverage department, is there any demand for your restaurants from non-tourists? What do you have to offer on a daily basis? All our restaurants are open to non-resident customers and we’ve worked hard at directing our marketing campaigns at these customers. In some cases the restaurants really are gastronomic ‘destinations’ which have helped to break down some of the barriers that have traditionally existed between the public and so-called “hotel restaurants”.

How would you sum up the Thema Hotels & Resorts concept in a few words? Thema Hotels & Resorts are iconic sanctuaries of the art of fine living located in outstanding destinations around Portugal, where understated luxury blends with a warm sense of service.  | 21


[ BUSINE SS INT E RV IEW ]

Bruno Moinard – CEO and Interior Architect at 4BI

A journey in discovery of

luxury CHRIS GRAEME | Interview

Cartier’s new 250m² boutique has opened in Lisbon’s Avenida da Liberdade 240. The store, on the ground floor of the refurbished building, is by interior architect Bruno Moinard, responsable for numerous projects in the field of luxury. The architect, who has worked with the French luxury house since 2000, is the mentor of the new layout concept and design of Cartier`s commercial spaces around the world – more than 350 boutiques. From where did you draw your source of inspiration for Lisbon’s new Cartier boutique project? What were the challenges and motivating factors?

We would very much like to build on this élan to develop other projects in Portugal.

that one creates to achieve the ideal solution for a place, in order to place the brand within an environment.

Is Cartier in Avenida da Liberdade your first Project in Portugal? Do you have plans to develop other projects in the country in the medium-long term? What was your perception of the luxury retail market in Avenida da Liberdade and did you find The boutique’s interior has been worked around the idea of any similarity to the Champs Elysées? The shop is at the heart of a quarter undergoing rapid development. It’s a classic Portuguese building, which we refurbished with a red façade.

“journey and discovery”, with different levels and all sorts of perspectives.

We hope that this store in Avenida da Liberdade will really stand out in the same way as the store does on the Champs Elysées. We would very much like to build on this élan to develop other projects in Portugal.

The current Cartier boutique is radically different from the old shop closed in 2009, both in size and dimension, and in terms of the number of the brand’s lines it has for sale. In the space of four years You are considered to be one of the most what has changed in Lisbon for Cartier to make this sophisticated contemporary architects and designers investment in its brand in Lisbon? Worldwide, working for Cartier, Hermès and several other luxury brands and hotels and private houses I have built up a relationship with the brand of over 10 around the world. What impact do you hope the years and the stores have a general line that is adapted to work you’ve done will have? FRAGOSO | eachSANDRA space andBÉRTOLO each country by personalising the Coordinating director, individual places. We’ve alsoSIL been working closely with Cartier in Lisbon to define the programme.

Time is not the most important aspect, but rather the link 22 | Prime Retail

It has always been part of our spirit to satisfy a client, whether it is a private client or a luxury brand, by taking great care of details, the light and space, to create places that stand the test of time. 


BRUNO MOINARD | CEO and Interior Architect, 4BI

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[ PA RT NE R R E P ORT ]

AVENIDA DA LIBERDADE A TEMPLE TO LUXURY

VICTÓRIA FERNANDES | Report

One of the main challenges for luxury brands today is balancing a broader distribution with reasserting the unique nature of their products – but this can’t happen without a physical store. A sophisticated ‘bricks and mortar’ strategy has become the ultimate way to maintain brand uniqueness with the wellheeled customer, and Avenida da Liberdade has been the destination of choice for this challenge in Portugal’s capital Lisbon. With the proliferation of luxury retailers online and the pressure to scale and grow (mass distribution reduces perceptions of exclusivity), luxury retailing is stepping up efforts to maintain its exclusive appeal. Bricks and mortar have become a strategic component in building an emotional connection to the brand (as it once did during the Belle Époque), and an effective way to maintain the legitimacy of luxury, despite mass distribution. Which is why luxury retailers are investing heavily in prime locations in exquisitely built period townhouses, mansions and flagship buildings to create that refined environment that creates a sense of intimacy. In Lisbon, luxury brands have chosen the majestic Avenida da Liberdade. A 90-metres wide and 1,270-metres long thoroughfare – the city’s first boulevard (designed in 1879) where Lisbon’s aristocracy would establish their town houses and rub shoulders with the nouveau riche upper middle liberal merchant classes. For some decades, from the end of the 19th and beginning of the 20th centuries until the 1930s it became the showcase for some of the country’s bolder architects – ‘the ex-libris’ a new urban development characterised by the Art Nouveau and Deco styles. After the 1950s the avenue fell into a slow decline, so that by the end of the 20th century many of the once grand mansions had fallen into disuse, decay or had been abandoned. The dawn of the millennium saw the beginning of its revitalisation, particularly at the top end of the street. At the 24 | Prime Retail

time, two store concepts dominated (the classic Casa Ayere, dedicated to haute couture and the tailors Rosa & Teixeira) but no one imagined that the avenue could become a centre for international fashion and luxury. Zegna, Boss, Emporio Armani (1998-2000) and Vuitton (2004) were the first to set up here – visionary brands, that believed in the avenue’s potential. Whilst many of the original buildings were replaced by modern buildings in the 1970s and 1980s, today the avenue is officially recognised and listed as being of ‘significant public interest and landscape value’ (with magnificent fountains, art and sculptures), urban and architectural monuments that are representative of late 19th and early 20th century architecture. Not surprisingly, this boulevard is hotly competed over by some of the world’s most notable fashion and luxury brands. Following Prada, in 2010, shop openings came fast and furious with Gucci and Miu Miu (2012); Cartier (July 2013); MaxMara (2013); Michael Kors (2013), amongst many others. The grandness and elegance of this tree-lined boulevard has bestowed nobility and cosmopolitanism on these high society addresses, but other factors have attracted the brands, such as shopping tourists from fast-growing economies (Brazil, Angola, Russia and China), rents below those charged in Madrid, Paris or London, and the busy aspect of the avenue itself – full of tourists and


(...) customers feel they are entering another world; one that is unique and inimitable. locals working in and around the banks, offices not to mention the theatres, restaurants, five-star hotels, fashion events (Vogue’s Fashion’s Night Out), restored belle époque refreshment kiosks and the 1980s sophistication of the Tivoli Forum shopping mall which houses many upmarket brands. This avenue exudes a gracious living which sets it apart from other landmark avenues in Europe like Avenue Montaigne, in Paris, or Calle Serrano, in Madrid. In Lisbon’s Avenida da Liberdade (as is the case with the most exclusive shopping streets of the World), luxury brand clothes and accessories are not the only aspect of a brand’s identity. The location, architecture and interior design of a shop have become a fundamental way of expressing the brand’s style and personality and, particularly to revail their unique qualities. For most successful luxury brands the flagship boutiques’ architecture and interior design are conceived as works of art. Top international architects are called on to design these stores (Rem Koolhaas and Roberto Baciocchi for Prada, Frank Gehry and Peter Marino for Vuitton, Bruno Moinard for Cartier) helping to select the properties which they believe express the DNA of these brands. Prada chose No’s 216-218, one of the most sumptuous in the avenue - which was the winner of the coveted national Valmor Award – and seen as a perfect epitome of the organic Art Nouveau style, at the time a symbol of luxury in Portugal, designed by the architect Manuel Joaquim Norte Júnior in 1912. The building’s decorative opulence, which not only adds to the grandness and grace of the promenade but also adds to its distinctive character. Adolfo Dominguez chose No. 180 (a façade of significant artistic merit), also a Valmor Award winner (1927), by the same architect who designed the Prada building. Cartier selected a fine example of eclectic romantic architecture from 1913. On the exterior façade this historic building stands out for its blood red colour, alluding to the much coveted dark red box in which Cartier wraps its pieces. True to the spirit of the House of Cartier, the shop cultivates the art of receiving and inviting patrons to discover the elegant

salons dedicated to jewellery, watches and accessories, while the VIP salon is a tribute to the Portuguese royal court in 1905 (the date in which King Carlos I made Cartier official purveyor to the royal family by royal appointment). The iconic MaxMara bought up an entire 2,000m2 historic building, all renovated to detail and decorated in the most immaculate way. Others share lovely buildings, as is the case with Gilles and MontBlanc (Nos 103-107) or Boss and Ermegildo Zegna (Nos 139-151). The brand Miu Miu rents two floors of a fine historic building, whose owners had been sought out by Dior, Chanel, among others, with a view to acquiring this building (their offers

were turned down). If these haute couture brands have not yet set up shop in the Avenida then it is because the supply of suitable properties is increasingly scarce given the demands of these brands, which require large areas, façades of at least 8-12 metres and emblematic buildings. In this avenue, the luxury mansions represent a cross section of commerce, art and hospitality, many have become venues for exclusive events, VIP cocktail, private exhibitions and a destination where customers can be fêted by the unique beauty of a brand’s culture and being treated to memorable shopping experiences. From the landmark locations of the stores to the moment they step through those doors, customers feel they are entering another world; one that is unique and inimitable. It is hoped that in Lisbon new clusters of luxury retail pop up in the roads leading off Avenida da Liberdade, as was the case in London (Mount Street), Chicago (Rush Street and Oak Street), New York (NoMad and Soho’s southern section)... With the historic wealthy and architectural diversity of this area it is not hard to see why upmarket brands want to find the perfect space to best express their identity and reinforce their unique singularity, promoting the urban regeneration of these listed buildings and projecting an image of Lisbon internationally as one of Europe’s most glamorous temples to luxury.  | 25


[ BUSINE SS INT E RV IEW ]

“ Freeport is the third

favourite shopping destination for nonEU tourists and still growing where the Chinese and Russian tourists market is concerned.

NUNO OLIVEIRA | MANAGING DIRECTOR, FREEPORT

26 | Prime Retail


Freeport

SMART FASHION SMART SHOPPING CHRIS GRAEME | Interview

Despite the economic downturn, Freeport, Europe’s largest Outlet, has continued to thrive thanks to an innovative policy of looking after its retailers, providing its customers with an unbeatable mix of top fashion brands at competitive prices, catering to shopping tourism, creating a family atmosphere and providing entertainment. Nuno Oliveira explains to Chris Graeme the Outlets’ strategy.

The secret of Freeport’s success is having a good tenant mix. China and Russia) are; Burberry, Hugo Boss, Lacoste, Diesel, What benchmark brands have most contributed towards its D&G… amongst others. success and what new brands are expected for 2014/15? Despite the difficulties currently experienced by the Full Price Freeport has based a large part of its success and position of leadership on two main principles: a great mix of quality brands both national and international, without comparison to any other shopping centre in Portugal, as well as an increased effort in promoting shopping tourism.

retail sector, we are confident that we will be recruiting new brands in 2014. We are aware that some brands, such as the ones who depend on tourist spending, obtain their best results at Freeport, a relevant factor for other brands to decide to join our centre, with special focus on the Premium sector.

We currently have the strongest and most comprehensive range on offer for the Premium, Surf and Sport sectors of any shopping centre in Portugal. On the other hand and this is thanks to our size, we are able to provide a cross-the-board offer which caters to a new shopping pattern, where choice is now based on more rational factors, such as price/functionality. The same client may purchase a purse at Carolina Herrera followed by a pair of trousers at Lefties. The results are proof of this. At the top of sales in general are premium brands such as Carolina Herrera, Hugo Boss, Tommy Hilfiger, Lacoste, Gant, Burberry, Adidas, Asics, Pepe Jeans, Bimba & Lola as well as Mango, Lefties, Pull & Bear…

In a downturn which has lasted since 2010 and has affected Portugal exceptionally badly, how have you and the retailers managed to maintain the value of premium brands without devaluating them with constant discounts and sales?

The most sought after brands by non-EU tourists (Brazil, Angola,

Internationally renowned big brands are easily able to deal with periods of crisis. Premium Brands are a prime example of this, proof of this lies in the growth these brands have experienced worldwide, particularly in Europe where there is currently a general crisis. On the one hand, those who have money continue to spend even if less so; on the other hand, those who don’t invest in quality and not quantity. In this Freeport’s claim “Big Brands and Big Discounts” encapsulates the key characteristics of the centre. Our positioning in this market is a cross between “smart shopping” and “affordable luxury”.

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[ BUSINE SS INT E RV IEW ] Which shops and new brands opened at Freeport in 2013?

Ten new shops opened at Freeport in 2013, the last quarter was particularly rewarding of the efforts that have been made, with the arrival of Armani, Guess, Nike and Douglas. More than just working on the occupation rate, we are working on quality occupation which contributes to solidifying the centres’ strategy, namely its’ positioning as the best national Outlet, with the best brands, fundamental not only for the national client but also for the potential of attracting tourists. In addition to the new openings we would also like to point out changes in management, shops that and are now managed directly by the brands (Benetton and Quiksilver), as well as significant refurbishments of existing shops (Lefties is a prime example of a refurbishment and expansion) this is an important indicator of brand investment in Freeport. We have many refurbishments and expansions scheduled for the first quarter of 2014 namely; Levi’s, Lacoste and Sacoor that are scheduled to commence this month.

How have entertainment events contributed towards bringing shoppers an overall shopping experience?

Freeport is much more than a place to shop, it is a place with unique characteristics and was designed to be experienced, with green spaces, esplanades and lounge areas. We have adopted a retailtainment strategy which values entertainment and animation to provide our visitors an all-round experience, by means of music, artistic activities which provide a renewed energy or specifically with children in mind. These are important anchors for Freeport’s positioning, allowing families moments of leisure and relaxation which go hand in hand with a day out shopping.

Many shopping centres have resorted to Pop-up stores to combat the crisis. Has Freeport gone down that road? Freeport began testing the pop up store concept in 2008, the year in which we opened the first pop up store, with this name and concept in conjunction with the Brodheim group. The objective has always been to allow potential shopkeepers to test our outlet concept and test the acceptance of the brand in this format.

This format allows an opening without the same type of commitment or investment as is required for a fixed shop, at the same time providing the retailer and the centre an opportunity to evaluate if the concept and or the brand will be able to achieve the objectives defined by both parties. As an example, the Criação Nacional Moda (National Fashion Creation) pop up was open at Freeport from July 28 | Prime Retail


to September 2013, this pop up allowed for 920 different items by 11 Portuguese designers to be available in one place at prices which made national designer items accessible to everyone. The national designers who joined forces to bring this innovative pop up project to fruition in an Outlet environment were Storytailores, Katty Xiomara, Pedro Pedro, Os Burgueses, Ricardo Andrez, MEAN by ricardopreto, Diogo Miranda, Elisabeth Teixeira, Alexandra Moura, Anabela Baldaque and Nuno Baltazar.

Some years ago Freeport’s marketing image was partly associated the outlet with a fashion image. Is that still true today? Without a doubt. One of the most important means to communicate this strategy is the Free magazine, launched in 2009 and in the first quarter of this year a re-launch with a completely new positioning in mind, not only a new image but above all content, more focused on what our clients are looking for: smart fashion/smart shopping

How successful has the Freeport card been since its launch some years ago? The Freeport credit card was launched at the end of 2011 and it is one of our most important across-the-board commercial instruments. The results for 2013 are the confirmation of the objectives that were behind its conception: loyalty and increase in average spend, particularly through the interest free and reward program which rewards purchase without financial charges. This card enables our national clients’ easier access to brands, namely higher quality premium brands in a rational manner “fashionable purchases, comfortable to pay”.

How far has the influx of wealthy tourists from Angola, China, Brazil and Russia contributed towards Freeport’s success over the past two years? We do not have information that will allow us to estimate the percentage volume of sales obtained from our European tourists in comparison with our national clients; we do know however, that the Spanish, French and English tourists are our biggest European clients. Thanks to the Tax Free information we are able to quantify the very relevant volume of sales of these visitors. The tourist is, usually, a visitor with a high level of purchasing power. In a study carried out by us on the tourists who visited us in September 2013, 36% of those questioned replied that they had made purchases for more than €300 and 37% between €100 and €300. The non-EU shopping tourist sector is currently responsible for more than 20% of Freeport’s volume of sales. In 2012 it was 10%... Freeport is the third favourite shopping destination for non-EU tourists and still growing where the Chinese and Russian tourists market is concerned.

What makes your philosophy and brand image different from competitors?

The biggest challenge and our primary focus is to consolidate the offer and to position ourselves as the best Outlet in Portugal, as previously mentioned. We do not however, only want to be the best place for brands to our clients (B2c); we also want to be the best place for the brands (B2b), who are on first analysis our direct client. We won’t be able to build a robust offer if we do not build upstream, through convergence, adaptation and innovation. In order to achieve this, we have in place today a Tenant Relationship Management Team (TRM); the only one of its kind in shopping centres in Portugal, whose mission it is to ensure an effective and profound partnership with our shopkeepers. In first place the prospect of the brands, in accordance with the visitors’ needs and the possibility to attract more visitor numbers. Following the formality of establishing a commercial relationship, the ebb, the TRM’s function is to accompany the shopkeeper (partner) in retail operations management, evaluating merchandising aspects, pricing, customer service amongst other activities that influence and contribute to the positioning of the brands and Freeport. The level of service provided to our clients (here we are referring to two types of clients) recognised by the different stakeholders as differentiating.

Freeport is the largest outlet in Europe. Are there plans to repeat the successful formula in the north of Portugal or Spain? Given the current economic climate, a hypothetical investment on this scale for this market is, for the time being, on standby. The Freeport Group has however, been developing in other countries outside of Europe. 

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[ PA RT NE R S OPINION ]

LISBON CITY CENTRE OFFICES AND COMMERCIAL MARKET PAULO SILVA | Managing Director, AGUIRRE NEWMAN PORTUGAL

In the aftermath of a year which saw weak performance in Lisbon’s office and commercial market, now things in 2014 are picking up. It is important, however to forecast trends in these two market segments for the coming years, including the hotel segment.

S

tarting off with the offices market, which has suffered considerably, with the highest vacancy rate recorded in Lisbon over the last few years. 13.38%, corresponding to 603,000 m2 the only thing that one can say is that “it can only get better”. In Zone 1, the main office area in Lisbon, the percentage of available offices relative to stock went from 6% (34,694 m2) in 2008 to 9.83% (57.784 m²) in 2013. This reality did not have an impact on prime rents in Zone 1, which climbed from €20 /m²/ month (2008) to €21/m²/month (2013), down to the demand for quality buildings. However, it did have an impact in overage rents, which fell from €18.23/m²/month (2008) to €16.10/m²/month (2013). Given that fact that within two years an area greater than the increase in the available areas between 2008 and 2013 will become available (around 23,000 m2), it is to be expected that the prices charged for renting the best of the spaces (prime rents) will fall to figures that we estimate will not exceed €17/18/m2/month. The retail market, in respect of the best locations (high street retail: Av. da Liberdade and R. Garrett), has been very much bucking the trend, where rental values have seen an increase, because of the demand for available space for which, for particular dimensions (such as small areas) values have already exceeded €100/m²/month. This situation will not undergo significant changes given the small size of the market in question, in which the number of shops showing a change of tenant has not exceeded an average of 6/year. In the centre of Lisbon it is important now to let premises in the secondary streets leading off the main shopping high streets and avenues, which until a few years ago had nothing to recommend themselves when it came to attracting brands and activity. In the vicinity of Av. da Liberdade there are today some centres of attraction for the restaurant sector in Rua Barata Salgueiro, Rua de São José and

30 | Prime Retail


In the centre of Lisbon it is important now to let premises in the secondary streets leading off the main shopping high streets and avenues, which have strong potential.

Zone 1. Prime CBD

47.515

8,23%

51.818

8,88%

57.784

9,85%

2. CBD

88.557

8,36%

109.215

10,31%

122.025

11,52%

11,73%

3. Emerging Office Zone

63.650

13,50%

61.846

12,78%

79.266

16,38%

28,17%

4. Secundary Office Zone

33.386

7,16%

21.882

5,68%

28.648

7,44%

30,92%

5. “Parque das Nações”

65.796

18,45%

55.702

15,51%

40.890

11,39%

-26,59%

213.106

23,72%

229.185

25,51%

237.333

26,12%

3,56%

6. Western Corridor

29.133

0,76%

32.991

0,88%

37.078

8,84%

12,39%

541.143

12,00%

562.639

12,43%

603.024

13,25%

7,18%

7. Zone 7 TOTAL

11,51%

Rodrigues Sampaio as a result of the opening The occupation of these new spaces, of new spaces in the past few years. unlike areas which have been taken up Av. da Liberdade and Rua Garrett, have been The Downtown Baixa has also seen an taken up by “anonymous” retailers, which interesting boom which has spread out to do not fit the profile of famous Rua Augusta and ruas Garret/Carmo. The international brands, but are based on parallel and perpendicular roads running of innovative entrepreneurial visions and are these main shopping streets have enjoyed a clearly aimed at that market which gives commercial renaissance thanks to the urban them most notoriety, a successful market restoration and renewal seen in the above which in the vast majority of cases is a main shopping streets and thanks to changes comfortable indicator of the survival and in the Rental Law and the sheer number of growth of these shops.

these hotels will be in the city centre. We are witnessing a remarkable boost in the tourism sector which bucks the recession felt in other segments of the real estate market which are still far from seeing the kinds of confidence levels that are driving these hotel investments, to which too should be added the significant increase in the number of new rooms within the Local Accommodation category which has rippled out as a consequence.

HOTEL PIPELINE FOR 2014 - GREAT LISBON Hotel Unit Lux Lisboa Park Hotel Avenida da Liberdade Porto Bay Liberdade

Developer

Adress

Planned Opening

Category

Rooms

LUX HOTELS

Rua Padre António Vieira

01-3-2014

4

97

Pedro Mendes Leal

Av. Liberdade 164

01-3-2014

5

25

Porto Bay

Rua Rosa Araújo

01-6-2014

5

98

HF Hotels

R. Joaquim António de Aguiar

01-7-2014

3

109

Hotel Portugal (re-opening)

Sotelmo Group

Rua João das Regras

01-1-2014

4

53

SANA Evolution Saldanha

Sana Hotels Group

Praça Duque de Saldanha

01-5-2014

4

144

Holiday Inn Express Avenida da Liberdade

InterContinental Group

Rua Alexandre Herculano

01-1-2014

4

108

Hotel Indigo Lisbon Old Town

InterContinental Group

Rua da Prata

01-5-2014

3

70

2

56

5

40

5

120

HF Fénix Music

Rossio Garden Hotel Royal Óbidos Spa & Golf Resort Hilton Bom Sucesso Golf & Spa

Individual

Rua Jardim do Regador

Oceânico Group

Óbidos

Hilton

Óbidos

??? 01-6-2014 ???

TOTAL TRYP Lisboa Aeroporto

Hoti Hotéis

920 Airport

01-12-2013 Soft Openning

4

168

Source: Aguirre Newman

tourists visiting this part of Lisbon. The lift to the Castle and the recent works in Rua da Vitória have introduced a transversal quality to the downtown Baixa which boosted by the two aforementioned effects will make them unrecognisable within 10 years.

Lastly, one cannot fail to mention the star performing sector for 2014 in terms of central Lisbon premises occupation: the hotel sector. In 2014 11 hotels are slated to open in Lisbon, representing an increase of around 900 rooms, nine of

We believe that we are witnessing a boost that will enable us to modernise the Centre of Lisbon City which will only increase the reasons to be even more proud of our capital in the not too distant future.  | 31


[ PA RT NE R S OPINION ]

AVENIDA DA LIBERDADE AND CHIADO IMPROVE LISBON`S INTERNATIONAL IMAGE

JOSÉ VELEZ | DIRECTOR, PRIME YIELD PORTUGAL

O

f all the Lisbon areas that had been run down and far from taking the pride of centre place they deserved in the life of Portugal’s capital, Avenida da Liberdade and Chiado, whilst attracting a different crowd, have, in recent years, recovered the prestige they once had, and today 32 | Prime Retail

have a new lease of life, attracting more people to work, live and visit the two areas and more shoppers. In fact they are the two areas that have most contributed to adding value to Lisbon’s international image.

with the countless projects, both residential and non-residential, that have sprung up in these areas.

Chiado, which in August last year marked the 25th anniversary of the fire that almost completely destroyed an entire block, began its journey to Clearly this movement depends on and recovering its centre stage position brings the real estate market with it, in the city’s life and did so a long since it is crucial for this revitalisation, time before Avenida da Liberdade.


(...) the expectations for the development of Chiado and Liberdade as retail, office, hotel and residential zones as relevant markets for real estate capital, couldn’t be better!

For almost a decade Chiado has been consolidating its position as a cosmopolitan and trendy place, the buildings in its streets having been restored and refurbished with new housing projects, an established range of commercial outlets and a wide range of office buildings that have been modernised, not to mention its strong draw as a major tourist attraction. This regeneration has born fruits in terms of the real estate sector, and in terms of residential and commercial levels, Chiado is now one of the city’s most valuable brands. In fact, in residential terms and according to the data released by the market, the average rents in this area have already exceeded €10.5 per square metre, making the Chiado the most expensive in Lisbon in terms of residential lets, while the other areas have rental values that vary between €10 and €7.5 per square metre. In retail the picture is the same, and Chiado is currently the most expensive shopping district in Portugal, with rents that can top €90 per square metre per month, an amount that already exceeds the average values seen in many shopping centres which for years were the preferred choice for retailers. But the traders seem to be willing to pay this level of rents, since, as is well known, one of the main stumbling blocks to the opening of new shops in the Chiado is down to a lack of space, mainly in Rua Garrett, which is the preferred option for retailers given the

fact that it has more pedestrian traffic than almost anywhere else in Lisbon. The office market in Chiado has also gained particular relevance in recent years, with new projects and many companies, encouraging a fairly robust rehabilitation of buildings. With a positioning more focused on the sale of luxury products, Avenida da Liberdade has in the last two to three years emerged as high street attracting top-of-the-range brands, with a number of shops that compares it favourably to rival European upmarket shopping districts in this segment. In fact, for an avenue which around 10 years ago was almost partially abandoned, today we have a bustling and lively high street with new shop openings occurring on an almost quarterly basis, new hotels, and the revitalisation of many assets that form part of the office stock in this area, today recognised as the Prime Location for the Lisbon office market. In fact, the office market has been especially buoyant in this street in terms of offer, with many landlords deciding to do up their buildings with a view to modernising the interiors and restoring the façades, giving the Avenida a new look. Despite a fall in Lisbon’s office market performance, this area continues to register one of the lowest vacancy rates in the market, remaining the preferred destination for many companies and representing a benchmark in terms of rents, with a prime rent of around €18.5m2/month.

This buoyancy is also visible in the rents, with values hovering between €75 and €80 per month per square metre. Demand for commercial space has remained high, and in 2013 alone around 10 brands have opened new shops in Avenida da Liberdade, among which are brands such as Michael Kors and Cartier. And judging by the expected openings already announced, interest in Avenida da Liberdade doesn’t seem to have abated. The avenue is already an established shopping street for luxury shoppers, including a strong component of foreigners visiting Portugal both for business and pleasure. Finally, it is important to remember that the consolidation of these two areas has been achieved during a particularly trying economic period for Portugal in which consumer indicators and disposable income have been at an all-time low, with the knock-on consequences that this has had on shopkeepers and companies, who base their decisions on the space they occupy according to their activity and amount of turnover. Which is why, given the more optimistic outlook for the economy, and taking into consideration that we are counting down to the exit of the Troika, the expectations for the development of these two areas as retail, office, hotel and residential zones as relevant markets for real estate capital, couldn’t be better!  | 33


[ BUSINE SS PROMO ]

CERRO DA BORREGA

A LOVELY RURAL RETREAT near the Alentejo coast Set in eight hectares of beautiful countryside within the South-West Alentejo and Vicentine Natural Park, Cerro da Borrega is an intimate Moorishinspired luxury development providing the perfect rural getaway. 34 | Prime Retail

Cerro da Borrega is an eight-hectare luxury residential rural estate with a villa built in the traditional wattle and daub style of Portugal’s stunning Alentejo region. The guest house, which blends in perfectly and unobtrusively with the surrounding landscape of gently undulating contours dotted with cork trees, is built around an inside patio with four suites available for let. The property, which has been designed to reflect the region’s Moorish influences, is in Beja District’s historic Odemira municipality, very close to picturesque Zambujeira do Mar and near to the charming town of Odeceixe, the birthplace of the Mirense, a nomadic people whose culture stretched back 5-8,000 years B.C.

This peaceful rural retreat is close to some of Portugal’s best beaches, many of which are off the beaten track. There are lots of activities to do in the area including eco-walks, riding, balloon rides and canoeing on the river Mira. The region is famous for its cuisine which is profoundly influenced by the symbiosis between the gently rolling ‘serra’ hills, the river and the sea, with a plethora of fish restaurants serving freshly caught produce which is served grilled all-year-round. The villa offers Wi-Fi, boast traditional wooden ceilings, patio hammocks and a cooling fountain. All of the rooms and suites afford views overlooking the garden and are furnished with goose feather eiderdowns and en-suite bathroom with two showers.


[ BU SIN ESS OPI NION ]

This lovely rural retreat is close to some of Portugal’s best beaches, many of which are off the beaten track.

Some of the suites feature curved brick ceilings and doors that open out onto the tiled patio. The spacious lounge area opens onto covered terraces with seating and overlooks the garden. It has a fireplace for cooler winter evenings and comfortable sofas. Guests can use the free available mountain bikes to explore the magical surrounding countryside or take a run on the jogging path which winds through the estate. CERRO DA BORREGA

Estrada Nacional 120, km 120 Vale Juncal 7630-675 São Teotónio – Odemira. Booking Rita de Lacerda e Mello ritalacmello@me.com + 351 966 04 33 06 GPS N – 37.47357º W – 8.72406º

www.cerrodaborrega.com

The villa, which is done out in the earthy tones typical of the region, affords the perfect place to enjoy a relaxing Thai massage or cool off under the outdoor shower, surrounded by nothing but nature. Cerro da Borrega can also arrange a number of activities for your holiday including sports, historic walks or strolls along the fishermen’s trail by the sea. Or why not simply relax in the peace and tranquillity of this perfect country retreat in the heart of Portugal’s sleepy Alentejo. 

| 35


[ BUSINE SS INT E RV IEW ]

WordReference

PARAGUAY – a world of investment opportunity for Portuguese SMEs CHRIS GRAEME | Interview

Partners in Business speaks to economist Francisco Acosta, CEO of WordReference which is currently investing in Paraguay where there are various business opportunities for Portuguese SMEs. WordReference has created and continues to seek partnerships to develop the wide variety of business identified as a priority by the Central Government of Paraguay.

Why did you decide to invest in Paraguay?

I began in the first half of 2012, through a joint business opportunity with a Spanish businessman to construct pre-fabricated homes. Since I am also linked to the international area of ANPME (National Association of Small and Medium Enterprises) for South America, I managed to create a partnership with a Portuguese-Brazilian company to build these homes. This was the starting point given that Paraguay is not well known by the Portuguese, but which actually has pretty interesting business opportunities for working in a wide range of sectors in the economy. Having the support of the Paraguayan Embassy from the start has proved very important, as well as the support of the public and private entities with which we’ve been working, with some agreements/ partnerships under development.

What political, economic and tax indicators make Paraguay interesting? There are many, such as a stable democratic political system, an independent judicial system, legislative stability – the laws that govern foreign investment, for example, date back to the 1990s. In 2013 the country enjoyed GDP growth of around 13.7% while its public debt stands at 15%. Paraguay’s inflation is one of the lowest in South America (3.7%) and there has been an increase of 18% in international foreign currency reserves at US$5.8Bn. I think these are positive indicators that stimulate the business environment. It has a very pro-investment tax policy; I would go as far as saying unbeatable when compared to neighbouring countries. Another strong argument in its favour is the free entry and exit of capital. There are no constraints at this level. I would even say that Paraguay is the Mexico of South America when it comes to attracting foreign companies that want to operate there.

Capital Gains and Commission Abroad is 0%. The cost of production/per hour is among the most competitive in South America. For example, there are studies which show that production costs in Paraguay are 35% lower than in Brazil. The country enjoys special privileges regarding the rules of origin for manufactured products until 2023 which is why it is easier to acquire MERCOSUL origin in Paraguay than in any other member country. If a foreign company invests in Paraguay to export there is a single tax at 1%. It’s worth thinking of this country as a regional platform for doing business with neighbouring countries.

What are Paraguay’s natural resources?

There’s a fairly high need for quality manpower and know-how transfer between companies. I am convinced that there is a very attractive potential here for small and medium-sized Portuguese companies. Unlike other countries, whose business turnover runs into millions or tens of million of Euros which limits SMEs, in Paraguay there are many fairly big business opportunities which are more accessible. There are many opportunities within the reach of our companies. Paraguay’s company network is essentially made up of small and medium-size firms and local firms are anxious to establish partnerships with Portuguese companies since there they are noted for being well managed and having good production practices.

Which sectors have the biggest investment potential and where can Portuguese companies fit in and operate easily?

I would divide my reply in two parts: the public and the private sectors. In common with the two sectors is the importance of Portuguese companies arriving in the country prepared to help job creation, train people and transfer technology know-how. Showing a willingness to make partnerships with Paraguayan companies is important too. For What procedures have to be gone through in order to open example, in the real estate and civil construction investments area of the a business in Paraguay? private sector there is a lack of quality development and building. The procedures are almost the same as those in Portugal. They have a Nevertheless, what is built is sold en-mass given the huge demand. public agency under the Ministry of Industry and Commerce which Another opportunity within this sector is the sale and rental of provides all the necessary help for foreign businesses to set up in Paraguay. equipment: Lorries, diggers and cement mixers to the building of Whenever we’re promoting and accompanying companies in Paraguay, warehouse blocks amongst other things. In terms of services, companies we always take the trouble to send them to this agency from the start. in the area of management and supervision, real estate planning and valuations are welcome. Other sectors with huge potential are the hotel Do you have to have a local partner on the ground and and catering industries, tourism, information technology, textiles and what incentives are created for foreign investment? clothing manufacturing, bio-fuels, call centres, metal-mechanics and There’s no obligation to do so. Any company or entrepreneur can set up metalwork amongst others. The public sector has a grand plan for companies there without any kind of constraints. By the same token infrastructure development and public works which cuts across all there’s nothing to stop someone from setting up companies in sectors. There is a US$12m budget for the next few years. It’s clear that partnership, joint-ventures or Ace with local businesses on the ground. It’s there’s a lot to be done here. In this case the public sector is giving up to them. Incentives for foreign investment are mainly tax. VAT, priority to foreign companies. Another area is building social housing Corporation Tax and Income Tax are taxed at 10%. The Tax on Importing (there is an 800,000 home deficit), sewage and drainage and transport of Goods and Capital, Remittance of Dividends Abroad and Taxes on water and effluents. There’s a lack of management in these areas too.  36 | Prime Retail


“ (...) local firms are

anxious to establish partnerships with Portuguese companies since there they are known for being well managed and having good production practices. FRANCISCO ACOSTA | CEO, WORDREFERENCE

| 37


[ PHOTO R E P ORT ]

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Helping the homeless

RockBuilding

Photo Report

Developer Rockbuilding debates the rehabilitation of Lisbon at a charity fund-raising lunch with the Portuguese Secretary of State, Carlos Moedas and Lisbon Municipal Council officer Manuel Salgado. 38 | Prime Retail

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1. CARLOS MOEDAS | Secretary of State to The Prime-Minister, Portuguese Government • JOSÉ ALMEIDA GUERRA | CEO, Rockbuilding 2. NUNO JARDIM | President, Associação Casa • JOSÉ PEDRO COBRA | Associação Casa 3. JORGE COELHO| President, Horizone • MANUEL SALGADO | Vice-President, Lisbon Council 4. JOSÉ ALMEIDA GUERRA | CEO, Rockbuilding • MARGARIDA CALDEIRA | Director, Malyan Portugal and Brasil 5. JOÃO GUERRA | Saraiva & Associados • MIGUEL SARAIVA | Saraiva & Associados • JOSÉ ALMEIDA GUERRA | CEO, Rockbuilding • EDUARDO ABREU | Neoturis 6. DANIEL SANTOS | BES 7. SOFIA GALVÃO | Vieira de Almeida • JOSÉ ALMEIDA GUERRA | Rockbuilding 8. LEONOR BENTO • ELISABETE MARQUES • ALEXANDRA FERREIRA • ANABELA ALEXANDRE, Rockbuilding 9. NUNO MARQUES | Rockbuilding 10. LUIS VAZ PEREIRA | Millennium BCP • PEDRO SÁRAGGA LEAL | PLMJ 11. MANUEL VISEU | Rockbuilding • FRANCISCO RIBEIRO | Rockbuilding 12. JOÃO CASTRO SIMÕES | Director, BES • JOSÉ ALMEIDA GUERRA | CEO, Rockbuilding • GODINHO LOPES | Board Member, Ónus 13. PAULO SILVA | Managing Director, Aguirre Newman • JOSÉ ALMEIDA GUERRA | CEO, Rockbuilding • PATRÍCIA DE MELO E LIZ | Managing Partner, Aguirre Newman 14. PEDRO REBELO DE SOUSA | Laywer 15. JOSÉ ALMEIDA GUERRA | Rockbuilding • JORGE TOMÉ | BANIF 16. ÂNGELO CORREIA | President, Fomentinvest • MANUEL SALGADO | Vice-President, Lisbon Council 17. FILOMENA BORDALO SILVA | AICEP • HELENA PAULA PIRES | Coordinator, AICEP 18. GONÇALO BATALHA | ECS Capital • ANDRÉ GOMES DE SOUSA | ECS Capital • JOSÉ ALMEIDA GUERRA | CEO, Rockbuilding • JOÃO FONSECA | ECS Capital • FILIPE MARQUES | ECS Capital | 39


[ PHOTO R E P ORT ]

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External evaluation for teachers with vocation

vital for Portugal’s education system Nuno Crato at the ICPT

CHRIS GRAEME | Photo Report

Teaching candidates will not be able to teach in Portugal’s schools without good maths and Portuguese skills says Nuno Crato at an ICPT lunch at Lisbon’s Fontana Park in February. English too will become obligatory in the 5th-9th grades in the biggest shakeup in Portugal’s education system since 1974. 40 | Prime Retail


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1. NUNO CRATO | Minister of Education and Sciences • MANUEL RAMALHO | President, ICPT 2. NUNO CRATO | Minister of Education and Sciences 3. JOÃO ALBUQUERQUE • FENGZHEN CHEN • MANUEL RAMALHO | President, ICPT • CHEN YUXIN 4. FRANCISCO ACOSTA | CEO, WordReference 5. NUNO SARAIVA 6. PEDRO PESSOA E COSTA | AICEP 7. ARELIS RODRIGUEZ • MANUEL RAMALHO | President, ICPT • CRISTINA PAULA BAPTISTA • ANALISA COSTA REIS 8. CHEN YUXIN • FENGZHEN CHEN 9. LEONOR BALANCHO • ELIZABETH ACCIOLI 10. ISADORA MARTINS 11. FILIPE QUINTAS FERREIRA 12. HENRIQUE SÁ NOGUEIRA 13. CRISTINA PAULA BAPTISTA 14. ANTÓNIO GONÇALVES • JOÃO BELEZA 15. CARLOS PORTO • MARCEL DE BOTTON 16. JOHANA TABLADA • ANTÓNIO PONCES DE CARVALHO | 41


[ PHOTO R E P ORT ]

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Portuguese tourism enjoys its best year since

records began BPCC lunch in Vilamoura, Algarve CHRIS GRAEME | Photo Report

The Secretary of State for Tourism, Adolfo Mesquita Nunes, tells British-Portuguese Chamber of Commerce members that the Government’s refocused tourism promotion and marketing strategy in strategic markets, new social technology and closer ties with foreign journalists were partly behind the success of the tourist boom in Portugal in 2013. 42 | Prime Retail


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1. CHRIS BARTON | CEO, BPCC • DONNA KRAMER | Sandy Blue 2. ADOLFO MESQUITA NUNES | Secretary of State for Tourism 3. PEDRO FERREIRA | Temática, Entretimento e Cultura, Lda 4. LUÍS BAPTISTA | Banco Santander 5. JORGE ROCHA • ANA CARDEIRA | Hilton Vilamoura As Cascatas Golf Resort & Spa 6. JORGE CABAÇO | Independent Business Consultant • ANNE DARLINGTON | BPCC • DOUGLAS STYLES | Sales Manager, Engel & Völkers • ERIC GIBSON, CEO, Engel & Völkers 7. PHILIPPA TAYLOR | Portugal Property • MICHAEL REEVE | AFPOP • ANÍBAL MORENO | Grupo Moneris 8. MANUELA BARBER | British Airways Iberia • LUÍS VASCO | British Airways Iberia • MELANIE OLIVEIRA DA SILVA | British Airways Iberia 9. RITA DE LACERDA E MELLO | Cerro da Borrega – Turismo Rural • HELENA FERNANDES • ADRIANA SILVA | BPCC 10. JOÃO GONÇALVES PEREIRA | CDS-PP • HÉLDER SANTOS | Dynamic Hotels 11. STEVEN PIEDADE | ANJE • BEV GIBBONS | Pinetrees Riding School • MICHAEL FERRADA | AlvoMira Lda 12. CHRIS BARTON | CEO, BPCC • CONSTANTIN JORDAN | Investment Adviser, Property and Tourism | 43


[ PHOTO R E P ORT ]

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In Retail

Congress 2013

CHRIS GRAEME | Photo Report

Ideas and paths for growth and the question of whether new models and formats were boosting growth for retailers, new consumer habits, the resilience and creativity of shopping centres to survive the crisis and how mobile payment solutions are revolutionizing retail were just some of the key topics at the In Retail Congress 2013 held in November at Lisbon’s CCB. 44 | Prime Retail


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1. ISABEL AFONSO | Retail Specialist, Freeport • SOFIA PORTO | Marketing Coordinator, Freeport • NUNO OLIVEIRA | Director, Freeport • .CLÁUDIA RAMOS | Tenant Relationshio Director, Freeport 2. TELMA HASSE DE OLIVEIRA | Coordinating Director, Mundicenter • JOÃO BRITO | Mestre Maco, SA 3. FILIPA REMIGIO | Artsana • ALEXANDRA PATRÍCIO | Artsana • CLÀUDIA BEIRÃO LOPES | Institutional Relations Director, Sonae Sierra • PATRÍCIA ARAÚJO | Head of Retail Dept, Jones Lang LaSalle 4. SÉRGIO BOTELHO | Visa • SHAMIL INDRAKUMAR | Unicre • RICARDO RIBEIRO | Unicre 5. MANUEL COSTA| Asset Manager, Retailgeste • PEDRO ASSUNÇÃO | Retailgeste • ROBERTO SENRA | Shopping Centres Operations Management Coordinator, Retailgeste • LUÍS LOUREIRO | Retailgeste 6. ANA OLIVEIRA | Marketing & Strategy Director, Itautec 7. PAULO SILVA | Director, DolceVita Tejo 8. RUI PATRQUIM | Sales Manager, SIBS Forward Payment Solutions • MARIANA GIMASI | Client Management, SIBS Forward Payment Solutions 9. JOSÉ GUERREIRO | Lojas Francas de Portugal, SA • ANA FERREIRA | Lojas Francas de Portugal, SA • NUNO AMARAL| Lojas Francas de Portugal, SA 10. PATRÍCIA ARAÚJO | Head of Retail Dept, Jones Lang LaSalle • CLÁUDIA BEORÃO LOPES | Institutional Relations Director, Sonae Sierra 11. LUÍS FIGUEIREDO TRINDADE | General Director, Partners in Business • PEDRO TEIXEIRA| General Secretary, APCC 12. ISABEL DIAS | Visabeira • MARIA JOSÉ VAQUEIRO | Jones Lang LaSalle 13. JORGE NASCIMENTO | LG Portugal • CLÁUDIA RODRIGUES | LG Electronics | 45


[ PA RT NE R S C AR ]

A benchmark in its segment... Honda Civic Tourer 1.6 CDTI

T

he CIVIC model in an estate format, the segment most sought after in the Portuguese market, has arrived! In terms of interior space and external size, this shooting brake will prove to be a reference in its segment because of the immense amount of space it offers compared to the competition. The Civic Tourer that we test drove came fitted out with an excellent diesel 120HP 1.6 i-DTEC engine which not only is extremely economical but also virtually silent and offers excellent performance. The on-board comfort is instantly noticeable, even on a journey carrying four adult passengers, which together with the quality upholstery and fittings, all command controls within each reach of your fingertips, and the new Adaptive Damping System (ADS) offer unbeatably smooth driving and road handling irrespective of the quantity of luggage and passengers being carried. The car’s sleek lines leave no one indifferent with its dynamic shape and sporty, sophisticated design that Honda fans have become so accustomed to with its latest models.

4646| Prime Retail | Prime Investments Retail

The new CIVIC Tourer 1.6 CDTI is available in the Portuguese market with four finishes - Comfort, Sport, Lifestyle and Executive. Price: from â‚Ź25,900


Image by carlos-vieira.com :: Model Jagienka Szymanska

Unique Experiences in Lisbon Vict贸ria World Travel (VWT) Guides can be adquired online at amazon.co.uk, fnac.pt, bookhouse.pt, bertrand.pt or at Portugal`s leading bookstores.

Travel Better & Wisely www.victoriaworldtravel.com

| 47


[ PA RT NE R S C AR ]

An excellent introduction to the

Mercedes range... A 160 CDI

The fantastic Class A which we all know and admire for all the best reasons, has now come up with its latest version called the 160 CDI. This model boasts a 1461 cm3 engine which always lives up to expectations, even with its 90HP engine ideal for the daily use of any executive,

and low 5 litre fuel consumption, low CO2 emissions and excellent on-board quality and comfort. In this model the values of the Mercedes brand are ever present. For €1,500 less than the 180 CDI, this model is fitted out with the same engine

block less 19HP but this more accessible car still achieves an impressive maximum speed of 185Kms/h. Price: from €25,700 Based on the same format as the Class C four-door, this coupé model is surprising for its aggressiveness and sporty handling. Price: from €25,700

The real deal in

sporty coupés... C 250 CDI coupé

Kitted out with the famous 250 CDI, bi-turbo diesel 204 HP engine, this car enjoys excellent performance and boasts an automatic 7G-Tronic gear box. Providing a truly sporty drive experience 48 | Prime Investments Retail

with seat height adjustment and steering wheel in just the right position, the low slung suspension and AMG Kit that comes with this version provides plenty of challenging fun along kilometres of winding roads and bends. Since there are

no miracles, space behind the front seats is somewhat limited, although sufficient for two passengers compared with its older sister in the Class E Coupé. Price: from €49,890


BMW 318 d GT

Class leading executive

Anyone getting into the BMW 318 d GT could be forgiven for thinking that this is a Series 5 judging from the immense amount of space at the back and a larger boot than in the touring version which opens at the flick of a switch. From the outside the design is plucky and

bold with greater appeal and style than the well known 5 GT series, making this the perfect car for the busy company executive. The version we test drove, the 318 d GT, has the well known 2.0 litres 143HP engine offering superb performance around town at 6 litres and an excellent drive both in town and on the open road.

In the Portuguese market the Series 3 GT will be available in three distinct finishes: Sport, Luxury and Modern, in addition to the popular sporty «M Sport» package in the version we tried, which provides not only a very sporty look but also comfortable sports seats finished in Dakota leather. Price: from €43,000

BMW 428i

The sporty car that’s different

The 4 coupé series that marks the Bavaria has size, dignity and space compared to its predecessor. This car’s performance has been significantly improved with excellent road handling on bends which is easily controlled in case of swerving. The engine that comes with this version, the 428i, is a 2.0 litre 245HP

powerhouse which achieves fantastic performances – 250 Kms/h maximum speed, normally associated with a sports car, but with fairly economical fuel consumption at around 8.5 litres. This model comfortably carries 4 adults, not to mention the fine quality of the interior fixtures and fittings, and the ease of access of all the controls, the easy to reach rear seats

and the comfortable steering wheel reach thanks to the fully adjustable driving seat. This model has four driving variants (EcoPro, Comfort, Sport and Sport+) which makes this sports car the sensible option for whoever loves a pure sports car in the true sense of the word and promises to be a sure hit with BMW enthusiasts. Price: from €49,700 | 49 | 49


[ PA RT NE R S OPINION ]

STORIES OF LUXURY VALTER ALCOFORADO BARREIRA | Executive Director, KNOWING COUNTS

C

ustomers’ experiences of luxury products and services, and harnessing their enjoyment and enthusiasm for the savoir-faire and quality of their materials and services to the benefit of that brand, are unique and frequently go far beyond what is imagined when buying. Indeed one enters into an exclusive world of current and potential benefits and relationships.

Harnessing customers’ enthusiasm for luxury brand products can only strengthen the brand’s image in the marketplace argues Valter Alcoforado Barreira, Executive Director of Knowing Counts. And how many fantastic and inspired stories luxury brands must surely have in their portfolio? Stories about their founders, innovative products and distinctive customers? I am certain that there is a world of facts based on events that have happened which could be transformed into stories with a strategic interest for the brand, and with different goals in mind; like for example, communicating who is the company, communicating and transmitting corporate values, increasing cooperation, sharing know-how and knowledge, dealing with staff in uncertain times and dealing with internal rumours or rumours in the market place.

The powerful story of a customer dazzled by a luxury brand is incommensurable (it is also one of a dissatisfaction in the opposite sense which is just as powerful), and the techniques of storytelling can help in the two cases – to capitalise the first And knowing that people often don’t and relativize in the second. exactly buy a product or a service, but rather a story, the experience that these These situations of satisfied customers, encapsulate is the one that is told by with unique and exclusive experiences, if someone in whom other believe. At the known by the brands in question, could be very limit, people buy “people”, and these used to benefit the brand in many strategic people who they prefer to work with are forms, could they not? From the the ones they know, like and trust. motivation of production staff, to the staff in the shops, and the brand’s There are no stories without people, communication with customers, to which is why the creation, cultivation communication between customers (word- and capitalisation of a good network of of-mouth marketing and the creation of contacts with a stake in a particular references), too just mention a few. luxury brand (e.g. customers, suppliers, opinion leaders,..) and the Good stories, when strategically used, capacity of a brand to create visibility crystallise into the idea of an emotion, through this network using which could cause a voluntary action (for pleasantness and trust, is fundamental example the act of buying), all in a natural for the identification, creation and way, one that is pleasant, memorable and propagation of stories that are strategic probably able to be replicated, even in a for the pre-defined objectives of these viral form. companies. 50 | Prime Retail

If stories enable an idea or an emotion to be formed, then the management of a network of contacts enables a personal layer of trust over the brand value proposition. And the increase of trust in the luxury brand’s internal and external target public is a fundamental factor for its business. A friend of mine, director of a luxury car brand, summed this up very well in a conversation that we had some days ago in his office. He told me that for a customer to part with €800,000 for a car – and showed me a photo of the model – one has to have a high degree of trust in the person selling it. Exactly! Which is why the ability to manage relationship networks is a key organisational skill for luxury brands and which should be developed as a priority by some of its professionals. The degree of trust in these contact networks will bring advantages that might materialise, for example, in two situations: 1) When a potential customer is involved emotionally in a story that he or she hears from another person and through the power of this reference is spurred on to buy the product. 2) By the excellence of the formal and informal relationship of the brand’s staff with their current customers, leading to brand loyalty and an increase in Share of Wallet. 

vab@knowingcounts.net


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Issue nº 9 partners inbusiness magazine