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Rio's Port Zone in Financial Strait

04/24/2017 - 11h14

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ITALO NOGUEIRA
FROM RIO

The crisis in the real estate industry has led to financial straits in the revitalization of Rio's port zone and threatens to affect the FGTS (Service Assurance Fund).

Six years after purchasing 6.4 million real estate titles, the Real Estate Investment Fund, Porto Maravilha, managed by the Federal Savings Bank, acknowledged that the papers have reached a standstill.

With the market pullback, developers are not interested in the titles, which authorize the construction of buildings taller than what is permitted.

The issue is that financing for works and public projects in the area, such as garbage collection and street lighting, is achieved through the resale of those documents, known as Cepacs.

With lack of interest in the market, the Federal Savings Bank did not achieve the pace necessary to meet the terms established during the purchase of the Rio's titles.

The city relies on this income to pay the concessionaire Porto Novo, responsible for activity in the area.

The port zone is one of the primary symbols of the infrastructure projects developed for the Olympics- and is cited in bribe cases linked to Lava Jato. 86% of the projects were completed, including the emblematic Olympic Boulevard and the Museum of Tomorrow.

The costs neared US $160 billion at the site. Planners foresee another US $160 billion in works and public services by 2026.

By purchasing the titles in 2011, the real estate fund committed to pass on the full value over the 15 years.

Translated by SUGHEY RAMIREZ

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