Cyrela - Apresentação Institucional - Março de 2004

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BRAZIL REALTYBRAZIL REALTY

March 17th, 2004

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§ Brazil Realty acts in a huge variety of segments, from residential buildings to commercial and shopping malls developments, being one of the most diversified companies of the Brazilian real estate market.

§ Brazil Realty acts in all stages of the process, from land acquisition to market and property management.

§ Brazil Realty is recognized for the high quality of its products and active marketing strategies.

§ A solid financial position generates conditions to adjust to economic and market changes as well as to take advantage of buying opportunities that occurs in crisis.

§ Brazil Realty focus on most-profitable market niches in São Paulo, Santo Andre, Campinas and Rio de Janeiro.

Cyrela / Brazil Realty group has built more than 2 million sqm since its start

In 2003 Brazil Realty was awarded with 1st places for the “residential launch of the year” and “commercial development” according to Prêmio Folha

Office rents revenues is enough to support company’s fixed costs

THE COMPANY

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BRAZIL REALTYBRAZIL REALTYHISTORY

Mr. Elie Horn startsreal estatebusiness in Brazil

Brazil Realty US$80.5 million IPO.

Portfolio of 9 proprieties

IRSA and Mr. Horn capitalize Brazil

Realty with US$30 million

Brazil Realty issuesUS$ 75 million in 8-

year Eurobonds

19621962

19941994

19961996

19971997

20002000

JK Financial Centerdevelopment is

completed. REIT Brazil launched

US$ 10 million capital increase

19991999

Meliá Campinas starts regional

expansion20012001

Total assets reach R$ 471.2 million. Portfolio of 64 proprieties.

Expansion to Rio de Janeiro

20022002

Cyrela acquires IRSA’s stake in the company

20032003

Brazil Realty redefines its focus to residential

developments

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BRAZIL REALTYBRAZIL REALTYGROWING ELEMENTS

Professional Managing Team

Modern Managing Tools

Economy of Scale / Proven Track Record

In-house sales team

Land Banking / Solid Portfolio of Properties

Clients Database

Solid Financial Position / Own Capital

Construction Certify ISO 9000

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BRAZIL REALTYBRAZIL REALTYGROWING ESTRATEGY

Product Diversification

Regional Expansion

Partnerships with other developers

Alternative Access to Capital Market

New Financial Models

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BRAZIL REALTYBRAZIL REALTYPORTFOLIO

2) Offices

3) Shopping Malls and Exposition Trade Pavillion

1) Residential

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§ Brand is associated to top-brand quality products

§ Innovative products and marketing strategies

§ Prime locations

§ Administration services

1) RESIDENTIAL PORTFOLIO

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BRAZIL REALTYBRAZIL REALTY1) RESIDENCIAL PORTFOLIO MARKET

• Brazilian housing shortage:– 5,3 million houses. Fundação João Pinheiro, 2001– 6,7 million houses. SECOVI, 2000

• Brazil Realty’s markets:– 1,1 million in São Paulo. EMBRAESP, 2000– 0,5 million in Rio de Janeiro. EMBRAESP, 2000

• Critical factors:– Inflation– Interest rates– Long term credits

Cyrela / Brazil Realty Group’s Market Share in São Paulo: 6%

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Average price of residential properties in US$/sqm x GDP in billion US$ (source: Sinduscon / MCM)

BRAZIL REALTYBRAZIL REALTY1) RESIDENTIAL PORTFOLIO MARKET

200

300

400

500

600

700

800

900

1993 1994 1995 1996 1997 1998 1999 2000 2001 2002

Price (US$/sqm) GDP (Bi US$)

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SPECIFIC PURPOSE

COMPANY (B)

SPECIFIC PURPOSE

COMPANY (B)

DEVELOPMENT (B)DEVELOPMENT (B)

BRAZIL REALTY

BRAZIL REALTY

1) RESIDENTIAL PORTFOLIO PARTNERSHIP STRUCTURE

PARTNERS IN DEVELOPMENT

(A)

PARTNERS IN DEVELOPMENT

(A)

SPECIFIC PURPOSE

COMPANY (A)

SPECIFIC PURPOSE

COMPANY (A)

DEVEPLOPMENT (A)DEVEPLOPMENT (A)

PARNERS IN DEVELOPMENT

(B)

PARNERS IN DEVELOPMENT

(B)

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BRAZIL REALTYBRAZIL REALTY1) RESIDENTIAL PORTFOLIO

TYPICAL CASH FLOW

1 2 3 5Year 0 4-

Lastinstallment

End of project

Construction ends

Construction acelerates

Launch

Constructionstarts

Landacquisition

+ +

Accumulated Cash Inflows

Accumulated Cash Outflows

Net Cash Flow

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BRAZIL REALTYBRAZIL REALTY1) RESIDENTIAL PORTFOLIOSÃO PAULO

• New developments (2003)– Mandarim (56% B.Realty)

• Brooklin Novo• 338 units• Sale Volume of R$ 57 million

(R$ 32 MM B.Realty)– A Reserva (50% B.Realty)

• Chácara Flora• 264 units• Sale Volume of R$ 53 million

(R$ 26,5 MM B.Realty)– Grand Garden (50% B.Realty)

• Jardim Avelino• 324 units• Sale Volume of R$ 53 milhões

(R$ 26,5 MM B.Realty)

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BRAZIL REALTYBRAZIL REALTY1) RESIDENTIAL PORTFOLIOSÃO PAULO

• New developments (2003)– Atmosfera (25% B.Realty)

• Vila Olímpia• 220 units• Sale Volume of R$ 68 million (R$

17MM B.Realty)

– Contemporâneo Moema (34% B.Realty)

• Moema• 39 units• Sale Volume R$ 25 milhões (R$

8,5MM B.Realty)

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BRAZIL REALTYBRAZIL REALTY1) RESIDENTIAL PORTFOLIO

SÃO PAULO (CYRELA / B.REALTY GROUP)

• New developments (2004)– 11 developments through

partnerships– Brazil Realty’s stake in sale

volume is R$ 250 million

• Potential land banking not used (2004)– 6 developments through

partnerships– Brazil Realty’s stake in sale

volume is R$ 160 million

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BRAZIL REALTYBRAZIL REALTY1) RESIDENTIAL PORTFOLIO SÃO PAULO

ÇIRAGAN

§ Jardins / Paulista Ave.

§ Site: 6.360 sqm

§ 252 unis

§ Units of 51 to 224 sqm

§ 48 office units

§ Sale Volume of R$ 80 million

§ Delivery date: April 2007

§ Architect: Itamar Berezin

§ 38% Brazil Realty’s stake

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BRAZIL REALTYBRAZIL REALTY1) RESIDENTIAL PORTFOLIO RIO DE JANEIRO

• New development (2003)– Le Parc (53%)

• Barra da Tijuca• 768 units• Sale Volume of R$ 323 million (R$

170 MM B.Realty)

• New development (2004)– 6 developments in partnerships– Brazil Realty’s stake in sale volume is

R$ 140 million

• Potential land banking not used– 4 developments in partnerships– Brazil Realty’s stake in sale volume is

R$ 135 milhões

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BRAZIL REALTYBRAZIL REALTY1) RESIDENTIAL PORTFOLIO RIO DE JANEIRO

LE PARC

§ Barra da Tijuca

§ Land: 55.000 sqm

§ 13 buildings / 768 units

§ Sale Volume of R$ 323 million

§ Units of 100 to 350 sqm

§ Delivery date: June 2006

§ Architect: S&W / Collaço & Monteiro

§ 53% Brazil Realty’s stake

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§ Prime location

§ Large Floorplates

§ State-of-art technology and features

§ Top-notch quality

§ Long term tenants, large national and multi-national companies

§ Own property managing team

2) OFFICE PORTFOLIO

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BRAZIL REALTYBRAZIL REALTY2) OFFICE PORTFOLIO

source: CB Richard Ellis / Cushman Wakefield Semco Dec/03

Occupancy and Rent Revenues History

24.000 (e)

15.88112.26611.400

9.0007.622

95%95%

96%92%99%

100%

0

5000

10000

15000

20000

25000

30000

1999 2000 2001 2002 2003 2004

,000

R$

88%

90%92%

94%

96%

98%100%

102%

2004: according to data table presented aheadRent Values in Latin America

-20%-15%

-5%-36%-7%-63%

05

101520253035

Argen

tina

México

Vene

zuela Bra

silChile

Urugua

i

US

$ pe

r sqm

2001 2003

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OFFCIES Monthly Total Occupancy Value Value B.RealtyRevenues (R$) Area (sqm) R$ / 000 per sqm Stake

Nova São Paulo 429.484 12.485 100% 53.860 3.748 100%

Verbo Divino 228.562 8.403 75% 28.663 2.975 100%

CENESP 63.137 2.844 100% 7.918 2.207 100%

Brasílio Machado 346.130 10.585 78% 43.406 4.000 50%

Brasilinvest 133.581 2.923 100% 16.752 5.369 100%

Faria Lima Financial Center 430.742 6.914 56% 54.017 10.685 100%

Corporate Park 232.265 4.510 100% 29.127 7.369 41%ABC Office 144.482 5.572 89% 18.119 3.252 20%

Total 2.008.382 54.236 251.862

Sep 30, 2003

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BRAZIL REALTYBRAZIL REALTY2) PORTFOLIO ESCRITÓRIOS LOCAÇÃO

JK 1455Faria Lima Square

UNDER Acquisition Site Total Delivery B.RealtyDEVELOPMENT Date (sqm) Area (sqm) Date Stake

Faria Lima Square mai/01 4.825 18.000 jul/05 13%Av, JK 1455 jul/00 5.257 20.197 jul/05 54%

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FARIA LIMA FINANCIAL CENTER

§ Site: 6.900 sqm

§ Total Private Area: 26.512 sqm

§ 17 floors from 1.280 to 2.220 sqm

§ Delivery date: Feb 2003

§ Architect: HOK / Collaço & Monteiro

§ Triple A building (new technologies / sofisticated high class)

§ Quality Award Prêmio Folha 2003: 1st place – office building

§ Tenants: Itaú-BBA, Credit Suisse, ING Bank, among others.

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§ 100.700 m² of leasable area

§ Own managing team

§ Diversified mix of stores

3) SHOPPING MALLS AND TRADE PAVILLION

SHOPPING CENTERS Delivery Gross Leasable Annual Revenues B.RealtyDate Area (sqm) (,000 R$) Stake

ITM Expo jun/96 44.430 5.250 36%ABC Plaza Shopping set/97 32.765 16.050 20%Avenida Industrial nov/99 23.551 2.940 34%

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§ Prime location

§ Potential sale volume R$ 690 MM

(R$ 293 MM B.Realty’s stake)

§ Changes in municipal laws: potential for construction is already assured

4) LAND INVENTORY

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BRAZIL REALTYBRAZIL REALTY5) ECONOMICS / FINANCIAL DATA

Annual Sales - B.Realty

84

127140

-

2040

6080

100

120140

160

2001 2002 set/03

MM

R$

New Developments - Brazil Realty

-2468

1012141618

2001 2002 set/03 2004 (e)

#

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Cash Flow

0

1.000

2.000

3.000

4.000

5.000

6.000

7.000

8.000

9.000

10.000ja

n/02

fev/

02

mar

/02

abr/

02

mai

/02

jun/

02

jul/0

2

ago/

02

set/0

2

out/0

2

nov/

02

dez/

02

jan/

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fev/

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mar

/03

abr/

03

mai

/03

jun/

03

jul/0

3

ago/

03

set/0

3

Construction

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Net Operational Revenues

-20406080

100120140160180

1999 2000 2001 2002 set/03

MM

R$

Net Profit

-

10

20

30

40

50

1999 2000 2001 2002 set/03

MM

R$

Stockholder's Equity

-

50

100

150

200

250

300

350

1999 2000 2001 2002 set/03

MM

R$

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Net Profit per Share

-

0,10

0,20

0,30

0,40

0,50

0,60

0,70

1999 2000 2001 2002 set/03

R$

Return on Net Equity

0%

5%

10%

15%

20%

25%

30%

1999 2000 2001 2002 set/03

MM

R$

Pro-rata

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401,2

125,1

125,8

117,7

79,5

363,7

0

100

200

300

400

500

600

700

Assets Liabilities

MM

R$


Current Assets

Long-Term Receivables

Permanent

Current Liabilities

Long-Term Liabilities

Stockholder’s Equity and Minority Interests

5) ECONOMICS / FINANCIAL DATA – BALANCE SHEET

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(MM R$) Sep 30, 2003

CURRENT ASSETS 401,157

Available Funds 143,559

Accounts Receivable 71,632

Properties for Sale 185,966

LONG-TERM RECEIVABLES 125,831

PERMANENT ASSETS 79,547

TOTAL ASSETS 606,535

CURRENT LIABILITIES 125,144

LONG-TERM LIABILITIES 117,692STOCKHOLDER'S EQUITY + MINORITY INTERESTS 363,699

TOTAL LIABILITIES AND STOCKHOLDER'S EQUITY 606,535

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BRAZIL REALTYBRAZIL REALTY5) ECONOMICS / FINANCIAL DATA – STATEMENT OF INCOME

(,000 R$) Jul 01 - Sep 30, 2003 Jan 01 - Sep 30, 2003

Gross Sales and Services 39.088 99.932

Developments 32.562 83.739

Rent of Properties 5.933 14.583

Services rendered and other 593 1.610

Deductions of Gross Revenues -1.728 -3.943

Net Revenues of Sales and Services 37.360 95.989

Cost of Goods and Services -13.602 -43.454Gross Profit 23.758 52.535

Operating Expences / Income -3.180 -15.630

Operating Profits 20.578 36.905Profit before Taxation 20.578 36.905

Income Tax and Social Contrib. Provision -1.170 -3.079Deferred 562 1.656

Minority Interest -303 -504Net Income for the Period 19.667 34.978

Number of Shares 79.777 79.777Profit per Share 0,2465 0,4384

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ce: B

anco

Bra

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5) ECONOMICS / FINANCIAL DATA

American Companies Economic Value Economic Value Economic Value/ Assets / Net Profit / Shareholder's Equity

CONS TOMOKA LAND CO-FLORIDA 1,56 36,37 2,20NEWHALL LAND & FARMING CO-LP 2,08 29,44 n.d.THE ST JOE COMPANY 2,16 26,83 5,26CENTEX CORP 0,85 21,82 3,70WCI COMMUNITIES INC 0,60 17,20 1,71TECHNICAL OLYMPIC USA INC 0,81 17,08 2,08WILLIAM LYON HOMES INC 0,75 16,95 2,54AVATAR HOLDINGS INC 0,49 16,27 0,86TOLL BROTHERS INC 0,97 14,14 2,84DR HORTON INC 1,02 12,10 2,45STANDARD-PACIFIC CORP 0,84 12,05 1,94DOMINION HOMES INC 0,79 11,50 1,72PULTE HOMES INC 0,61 11,08 1,52KB HOME 0,94 10,94 2,49HOVNANIAN ENTERPRISES-A 0,77 10,94 2,18BEAZER HOMES USA INC 0,82 10,48 1,82M/I SCHOTTENSTEIN HOMES INC 0,87 10,43 1,48MDC HOLDINGS INC 0,91 10,10 1,82RYLAND GROUP INC 0,67 9,87 1,63ORLEANS HOMEBUILDERS INC 0,80 9,77 2,69NVR INC 2,04 9,11 5,97LENNAR CORP-CL A 0,74 8,92 1,91HOMEFED CORP 1,07 4,86 n.d.Average 1,01 14,71 2,40Brazil Realty 0,60 8,82 1,44

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BRAZIL REALTYBRAZIL REALTYAWARDS

� Most Admired Companies in the Real Estate Sector (Interscience/ Carta Capital magazine)

– 2000 - Cyrela 1st, Brazil Realty 2nd place– 2001 - Cyrela 3rd, Brazil Realty 1st place– 2002 - Cyrela 2nd place– 2003 - Cyrela 2nd place

� Top Imobiliário– 1996, 1997, 1998, 1999, 2000,

2001, 2002

� Valor Econômico– 2001 - Executivo de Valor

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BRAZIL REALTYBRAZIL REALTYPREMIAÇÕES

� Top de Marketing / ADVB – 2001

� Summit de Varejo / IPEDV FGV - 2002

� Fiabci’s Prix D’Excellence– 1997 - Centro Têxtil

� Prêmio Qualidade Folha– 2003 – 1st place Launch of the Year: Vert Supreme– 2003 – 1st place Office Building: Faria Lima Financial Center

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BRAZIL REALTYBRAZIL REALTYOffice

Av. Brigadeiro Faria Lima, 3.400 10 andar

04538-132 - São Paulo – Brasil

Tel. (11) 4502-3000

Investors RelationshipLuis Largman – Director

[email protected]

(11) 4502-3153

SymbolCYRE4

Investor Relations

Cyrela - Apresentação Institucional - Março de 2004