TRX Group, a large São Paulo-based real estate developer and asset manager, has built a portfolio in Brazil that includes enormous grain silos, logistics centers for storing and shipping merchandise and equipment, warehouses and self-storage centers. It has developed more than 15 million square feet of mostly industrial and commercial properties in its home country and manages real estate assets of about $1.8 billion.
Now it’s operating in Miami.
“In 2013, we decided to come to the United States to diversify our business, and opened our U.S. subsidiary — TRX Investments — in Miami a year later,” said Luiz Augusto Faria do Amaral, the co-founder and CEO of TRX Brazil and TRX Group. “We have a lot of experience in real estate development and management of real estate assets, and we decided to expand in the U.S., starting with Florida. Working in partnership with local developers, we are investing here in the warehouse sector and in low- and high-rise multifamily residential units. We offer space solutions.”
The huge U.S. market offers TRX a lower risk profile than Brazil and other emerging nations because it has readily available and accurate information on land prices, sales, valuations, rents, demographics and comparable transaction prices, TRX executives said. The U.S. also has title insurance, transparent government approval processes, fixed development contracts, low inflation, access to tenant credit ratings and competitive financing options.
Data on potential projects, for example, is much easier to acquire here than in Brazil, simplifying risk evaluation. “It’s like a Disney World of information for us here,” said Scott F. Pryce, founder and CEO of Miami-based TRX Investments. “In the U.S., we can do a market study in four hours. In Brazil, it would take four months. We have abundant, transparent market data and information here.”
In many emerging markets, basic information — such as clear land titles — can be difficult or impossible to obtain.
TRX Investments focuses on a range of industrial and commercial warehouses, ranging from large structures to small bay and modular units. “We look for market segments where there is demand and good prospects for revenue growth,” Pryce said. TRX does a careful evaluation of each potential development site, looking at possible competition, accessibility, determining if roads need to be built, if there are environmental issues and estimating how much investment would be necessary to make a new site viable.
Currently, TRX Investments is developing a modular warehouse in Doral with 200,000 square feet of gross leasable area on 440,000 square feet of land, and is evaluating additional properties to develop or acquire throughout the state.
Miami-based TRX Residential is the unit of TRX Investments that focuses on multifamily residential development and asset management. Fernando Fiuza de Souza is the founder and managing director of the residential subsidiary, which currently has projects in Plantation and Boynton Beach.
The name TRX is derived from tamiz, which refers to a sifting screen like those used by gold prospectors to separate gold nuggets from other materials, plus the initials of other companies, Faria do Amaral said. “The idea is we separate value from other elements,” he said. Tamiz is the name of a company owned by Faria do Amaral’s family that has worked in construction and homebuilding in Brazil for more than a century.
TRX Investments and TRX Residential have already built an asset portfolio in Florida worth about $150 million, including projects under development, Faria do Amaral said. About $60 million of the total is concentrated in multi-family housing and the rest in warehousing. The company expects its assets here will grow to more than $200 million by the end of 2016.
TRX Group has 80 employees internationally, and eight in Miami.
A civil engineer and economist specializing in real estate, Faria do Amaral has more than two decades of experience in real estate development, portfolio management and capital markets. He is the co-founder and managing partner of Logbras, a TRX joint venture with Caixa Economica Federal, a major Brazilian bank, that specializes in building logistics centers, and MetroFit, a joint venture between TRX and Illinois-based Metro Self Storage that develops self-storage businesses in Brazil.
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Pryce has over three decades of experience in international real estate and real estate asset management. Formerly a U.S. Marine Corps officer, he has held executive positions at U.S. and international companies. Pryce has a bachelor’s degree in international relations from Wesleyan University, a master’s in international economics and strategic studies from John Hopkins University’s School of Advanced International Studies and an MBA from INSEAD, France’s graduate school of business.
Before joining TRX, Fiuza de Souza was managing partner of Biscayne USA, a firm that buys and renovates distressed single-family homes, and worked in management positions at two large banks in Brazil. He has a degree in business administration from Brazil’s Universidade Paulista and an MBA in finance from Insper, the school of higher education in Sao Paulo specializing in business, economics, law and engineering.
TRX Investments and TRX Residential have ambitious plans in the U.S. and are looking for new investors.
“All our assets currently are in Florida,” Pryce said. “This is Stage 1 of our strategy for the U.S. market. In the next stage, we are expanding into an area shaped like a triangle, bounded by Texas, the District of Columbia and Miami.”
TRX’s focus will remain on the warehouse and multifamily projects businesses, he said. “We will continue doing what we know how to do well.”
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Business: TRX Group is a large, Brazilian-based firm that develops and manages infrastructure and industrial/commercial property assets. It has developed more than 15 million square feet of industrial and commercial warehouse space and master-planned industrial parks in Brazil. In 2014, the group set up a subsidiary in Miami, TRX Investments LLC, as an investment fund for identifying, developing and managing projects in the United States. TRX Investments focuses on industrial and commercial warehouses, while its TRX Residential unit works in the multi-family residential property sector. TRX also has a joint venture with Illinois-based Metro Self Storage that develops self-storage centers in Brazil.
Corporate headquarters: São Paulo, Brazil.
U.S. headquarters: 600 Brickell Ave., Miami.
Founded: TRX Group was founded in São Paulo in 2007; TRX Investments was set up in Miami in 2014.
Senior management: Luiz Augusto Faria do Amaral, co-founder and CEO of TRX Group; Scott F. Pryce, founder and CEO of TRX Investments; and Fernando Fiuza de Souza, managing director of TRX Investments and founder and managing partner of TRX Residential.
Employees: Total 80, with eight in Miami.
Ownership: Owned by a group of private investors.
Assets: TRX Group manages $1.8 billion in total real estate assets. TRX Investments in the U.S. manages about $150 million of this total and is expanding.