Starwood Capital Group Makes Major Investment into MRV Logistica e Participacoes S.A., a Pan-Brazilian Commercial Real Estate Platform

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Jul 18, 2011, 04:25 ET

GREENWICH, Conn., July 18, 2011 /PRNewswire/ -- Starwood Capital Group ("Starwood"), a leading private investment firm focused on real estate, today announced it has committed to invest R$250 Million (approx. $156 Million) to acquire a 33% stake in MRV Logistica e Participacoes S.A. (“MRV Log”), the commercial real estate subsidiary of MRV Engenharia e Participacoes S.A. (Ibovespa: MRVE3) (“MRV”). MRV is the preeminent publicly-traded Brazilian low-income homebuilder and has a market cap, as of July 14, 2011, of R$5.4 Billion.

Starwood is investing alongside the original shareholders of MRV Log, who are contributing an additional R$100 Million in the current equity private placement on substantially the same economic terms. MRV Log is primarily focused on the development and leasing of its industrial real estate and, opportunistically, retail and office properties. The company will enjoy a proforma market value of approximately R$750 Million making it a major player in this very attractive space. The proceeds of the equity infusion will be used to fund construction of a nearly 10 million square foot pipeline and build a land bank for future development. Currently, 1.5 million square feet of this national portfolio are delivered or under development. MRV Log will benefit from MRV’s proven ability to source opportunities and execute development in a fast and cost-efficient manner on a national scale.

“We are very excited about this opportunity to join one of Brazil’s leading developers in building a national portfolio of Class A commercial real estate. We are tremendously impressed with the depth of the team and their sustained track record of achieving amazing growth while maintaining ‘best in class’ profitability,” said Barry Sternlicht, Chairman and CEO of Starwood Capital Group. "We are very confident in MRV Log’s execution capabilities as demonstrated by the tenfold increase in EBITDA at MRV between 2007 and 2010. We remain bullish on the market’s fundamentals."

Rubens Menin, Chairman and CEO of MRV and Chairman of MRV Log, said: “MRV believes that industrial real estate presents a tremendous opportunity in Brazil with huge pent up demand. We feel proud and privileged to be partnering with Starwood as they bring not only capital but also an extensive and highly successful track record in real estate investments in the US and abroad. Their knowledge and expertise will most certainly be of great help to our venture.”

Starwood opened an office in Sao Paulo in August of 2010. Ryan Hawley, VP in Acquisitions, joined two seasoned Sao Paulo-based real estate investors, Vitor and Rodolfo Senra, to establish Starwood’s Brazil business. Commenting on this transaction, Ryan said, “We have been studying the Brazilian market for some time. It is easy for a foreign investor to recognize the strength of the market fundamentals. Finding the right way to invest is more challenging. We believe that this management team is one of the strongest in Brazil. We are excited about this partnership and look forward to helping build this business.”

About Starwood Capital Group Global, LP

Starwood Capital Group is a private, U.S.-based investment firm with a core focus on global real estate. Since the group's inception in 1991, the firm, through its various funds, has invested over $9 billion of equity capital, representing nearly $28 billion in assets. Starwood Capital Group currently has approximately $18 billion of assets under management. Starwood Capital Group maintains offices in Greenwich, Atlanta, San Francisco, Washington, D.C., and affiliated offices in London, Luxembourg, Paris, Mumbai, and Sao Paulo. Starwood Capital Group has invested in nearly every class of real estate on a global basis, including office, retail, residential, senior housing, golf, hotels, resorts and industrial assets. Starwood Capital Group and its affiliates have successfully executed an investment strategy that includes building enterprises around core real estate portfolios in both the private and public markets. Additional information about Starwood Capital may be found at www.starwoodcapital.com.