PPP of R$ 4.6 billion aims for the construction of 20 thousand houses in the center of SP

27/02/2013 | 19h17
By Guilherme Soares Dias


SÃO PAULO  - The government of São Paulo defined the model of public-private partnership (PPP) that will ensure the construction of 20,000 housing units on unused lands in downtown São Paulo. The total investment reaches R$ 4.6 billion, of which R$ 2.6 billion to come from the private sector, R$ 1.6 billion from the state government, and R$ 404 million from the municipality. For the proposed model, companies may require R$ 184 million of financing from the Federal government through the program "Minha Casa, Minha Vida" or the Guarantee Fund for Length of Service (FGTS).


The PPP provides an internal rate of return between 8% and 10% and it will deliver in 20 years. The goal, according to the Secretary of Housing in São Paulo, Silvio Torres, is to promote urban redevelopment of the central area and ensure that most buildings are occupied by families who earn less than five minimum wages. "95% of the lands are already marked as special areas of ​​social interest (ZEIS) and they should be expropriated and demolished”, said Torres in an interview on Wednesday with Valor PRO, real-time information newspaper.

Of the 20,000 units, 12,000 will be allocated to people who earn less than five minimum wages (R$ 3,7 thousand - in São Paulo the minimum wage is R$ 755), and 2,000 units will be directed to people who are linked to entities with operations in the downtown area and that are already registered at the municipal government. The value of financial assistance in this case should range from R$ 150 to R$ 300 a month. The other units will be for families that earn less than 16 minimum wages (R$12,000).


"The priority is given to people who work downtown and live in other regions. We are following the policy of the city's masterplan to invest in housing projects located where there are urban facilities”, said Torres. Companies will earn money with the commercialization and administration of these projects. In addition to providing housing, the units must have spaces for public facilities such as day care centers and schools. "The units will be mixed and they will ensure profit for the investor with finance management and the condominium, among other things," affirmed the Secretary.


The chosen PPP model was presented by the Urbem Institute, incorporating proposals by the companies MPE and Impacto Gouvea, which constitute the Reviva consortium. Five companies presented studies for the project. The areas are located in 13 districts on the greater central area of São Paulo. 35% of the total areas are in the Luz neighborhood, where the Mayor of São Paulo, Fernando Haddad, withdrew the revitalization project of former Mayor Gilberto Kassab (PSD). The project was called "Nova Luz" and intended to regenerate the cracolândia area. "This new project aims to induce private sector initiative in the region. The degraded area isn`t good for investments, and now we want to attract them back to the center”, said the State Secretary of Housing of São Paulo.


Of the 20,000 properties, 7,000 are in the region of Barra Funda, Luz, Pari, Bom Retiro and Santa Cecilia (sector 1), 2,900 in the region of Republica and Bela Vista (sector 2), 2,900 in the region of Liberdade and Bras (sector 3); 2,400 in the region of Cambuci and Mooca (sector 4), 2,600 in the region of Belenzinho and Bresser (sector 5), and 2,400 in region of Belém and Celso Garcia (section 6).

This is the first PPP housing project proposed by the State. The government also plans to launch a second stage that will provide at least 30,000 properties in the metropolitan region of São Paulo, in Santos, Campinas and in the region of Glicério in downtown São Paulo.


Tomorrow the Governor of the state of São Paulo, Geraldo Alckmin (PSDB), and the Mayor of the city, Fernando Haddad (PT), will sign an agreement for cooperation in the project and authorization for the bidding process. A public call is scheduled for next week. The notice document should be published in May and it is expected for the contract with private companies to be signed in October. The construction should take from two to six years to be completed, and it includes the demolition of current buildings and construction of new projects. "There won’t be any interventions in heritage sites. Since their facade cant be modified, they can’t be turned into housing units”, said the Secretary of Housing of São Paulo.

The project also envisages walkways to cross over the railway line that runs through the region of Barra Funda, enabling new accesses to the area. The residents of the Moinho slum, according to the Secretary of Housing of São Paulo, will be transferred to the region of Vila dos Remedios, in the western part of the city, and are not included in this project.

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