GoldenTree InSite Partners, Atua Construtora Announce R$200MM Joint Venture Focused on Brazilan Affordable Housing and Initial 394-Unit Development

NEW YORK, Sept. 29 /PRNewswire/ -- GoldenTree InSite Partners announced that it has committed up to R$200MM of equity to a joint venture with Atua Construtora that will focus exclusively on developing affordable housing in and around Sao Paulo, Brazil. The R$200MM equity commitment is anticipated to finance projects representing over R$1.2Bn in total sales proceeds ("VGV"). The joint venture also announced the closing of its first investment, a 394-unit development located in the Belem neighborhood of Sao Paulo's eastern zone representing approximately R$54MM of VGV.

"We are extremely pleased to partner with a talented and experienced developer like Atua Construtora," said Tom Shapiro, President of GoldenTree InSite Partners. He added: "Though this is our fifteenth investment in Brazil, this is our first investment in the affordable housing space, an area in which we see tremendous potential."

"We are similarly excited to team up with GoldenTree InSite Partners," said Gilberto Farah, CEO of Atua Construtora. "GoldenTree InSite's experience investing in Brazil and the caliber of the team it has assembled here makes it an ideal partner as we continue to rapidly grow our business."

The initial project is located in a middle-class Sao Paulo neighborhood, but a special municipal zoning designation requires that it be developed as low-income housing, with unit pricing based on a multiple of the municipality's minimum wage requirement. As such, this investment highlights one of the key aspects of the joint venture's strategy -- building affordable housing in desirable middle-income neighborhoods close to significant infrastructure and amenities. By building attractive product in good neighborhoods at a discount to what units in neighboring buildings sell for, the joint venture anticipates strong buyer demand for its homes.

"Of the often-quoted eight million unit housing deficit in Brazil, over 95% is concentrated in the low and middle-low income segment," observed Josh Pristaw, Managing Director of GoldenTree InSite Partners. "Clearly there is a significant unmet demand for this type of product in the marketplace," he added.

"Beside the latent demand, there is significant government support for affordable housing at the federal, state and municipal levels," said Joao Teixeira, Managing Director and head of GoldenTree InSite Partners' Brazil efforts. He continued: "Through a variety of initiatives and agencies, the Brazilian government has channeled a significant amount of funds to affordable housing buyers, greatly increasing the availability of mortgages for this demographic while reducing their cost. This confluence of desirable, infill sites, substantial and growing buyer demand and increased government support and funding for affordable housing has resulted in a very attractive investment opportunity and one we intend to address in a meaningful way with the creation of this joint venture."

ABOUT GOLDENTREE INSITE PARTNERS

GoldenTree InSite Partners is a global real estate investment firm headquartered in New York with an office in Sao Paulo, Brazil. The firm was formed in February 2005 in partnership with GoldenTree Asset Management. GoldenTree InSite has 32 employees and manages over $1.1 billion of committed equity. The firm pursues value-added real estate opportunities through direct equity investment and non-traditional lending activities. To date, the firm has committed capital to residential, retail, industrial, office, hotel and mixed-use projects in the U.S. and Brazil. The firm's principals have over 80 years of investment, management and operations experience, which spans all major property types and geographies. By combining hands-on real estate expertise with a disciplined investment approach, GoldenTree InSite creates value for its investors and partners. For further information please visit our website at www.goldentreeinsite.com.

GoldenTree Asset Management, with offices in New York, London, Los Angeles, Chicago and Luxembourg, manages a variety of absolute return strategies, which invest in bank debt, high yield bonds, distressed debt, equities and middle market loans. GoldenTree manages $14.4 billion as of September 1, 2008, of which $10.1 billion are absolute return assets, and the firm has over 200 employees. For further information regarding GoldenTree Asset Management please visit their website at www.goldentree.com.

ABOUT ATUA CONSTRUTORA

Atua Construtora is a joint venture signed in April, 2008 between Yuny Incorporadora and Econ Construtora to develop projects for the affordable housing segment. This strategic alliance combines Econ's affordable housing expertise with Yuny's proven ability to develop differentiated, innovative products. Econ Construtora was founded in 2001 by principal Gilberto Farah as a developer focused exclusively on affordable housing. Since its inception, Atua has developed over 3,600 units in 13 developments resulting in over R$385MM in VGV.