| Volume # 146 |
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Corporate Real Estate Advisors l Atlanta
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Caracas, Venezuela
 Caracas and its Commercial Real Estate Market are unique in many respects. Did You Know… · Caracas, the capital and largest city in Venezuela, is located in the northern part of the country, and has a metropolitan population of over 5 million people. It is the Venezuela’s center for politics, economy, education, culture, and transportation. The Metropolitan District of Caracas encompasses the Capital District, and four other municipalities in the state of Miranda: Chacao, Baruta, Sucre, and El Hatillo.
· The economy of Caracas is mostly service based. Important industries in the city include chemicals, food, iron, leather, textiles, wood products, rubber, and cement. The city’s dense population has promoted the growth of the retail wholesale market, which is an important contributor to the economy. The city also hosts many service companies, banks, and malls. Aeromall, expected to open in 2009, is expected to have an area of 6.7 million square feet and 12,500 parking spaces, making it the largest mall in all of Latin America and ninth largest in the world. · Caracas is home to many foreign and local companies, including the state owned Petroleos de Venezuela (PDVSA), which is the largest company in Venezuela. PDVSA’s oil reserves make Venezuela fifth in the world for proven reserves of conventional oil. PVDSA focuses on the exploration, production, refining, and exporting of oil, as well as the exploration and production of natural gas. · The labor force in Caracas is skilled and well educated. Central University of Venezuela and Simon Bolivar University are two of the most prominent universities in the country. The Central University of Venezuela was founded in 1721, making it one of the oldest universities in Latin America. In 2000 its campus was acknowledged as World Heritage by UNESCO. · Despite traffic congestions, Caracas has a good transportation system. The city is well connected to its suburbs and to the rest of the country. Simón Bolívar International Airport of Maiquetia, located 13 miles from the center of Caracas, is the largest and most active airport in Venezuela. · The office market in Caracas continues to see strong demand. The city has a total of 7.5 million square feet of class A and AB office space, and has an overall vacancy rate of approximately 1.1%, a new record low. Due to the high demand and low supply, class A rental rates have drastically increased in the past few years. Rental prices currently range from $3.25 to $4.70 per square foot per month. Class A office sale value is approximately $500 per square foot, while the value of class B is over $372 per square foot. · New supply of class A has been very low since 2002. Over the next two years, about 807,000 square feet will be added to the market; however, most of the space currently under construction has already been leased. In the next few years, the real estate market in Caracas is expected to continue experiencing high demand, an increase in rental prices, low vacancy rates, and a shortage of class A space. |
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