Shopping Estacao Celebrates One Year in BRMALLS' Portfolio

RIO DE JANEIRO, Brazil, May 12 /PRNewswire-FirstCall/ -- BRMALLS Participacoes S.A. (Bovespa: BRML3), the largest integrated shopping mall company in Brazil, hereby announces to its shareholders the details of Shopping Estacao's evolution in its portfolio. Shopping Estacao was one of the largest acquisitions BRMALLS concluded in 2007.

Shopping Estacao was acquired on February 5th, 2007 and started to contribute to BRMALLS' results in April 2007. BRMALLS acquired the totality of the shopping mall and the convention center annexed to the mall, the Embratel Convention Center, by the total amount of R$ 108.8 million. BRMALLS also obtained the right to act as service provider for management and leasing of the mall. Since its acquisition, we have been concentrating efforts towards operational improvements focusing on several fronts.

Shopping Estacao was inaugurated in November of 1997 and is located in the city of Curitiba, in the state of Parana, in one of the most important avenues of the city.

Shopping Estacao has 52 thousand m(2) of GLA and is the only mall in the city of Curitiba that provides shopping, entertainment and culture activities in one place.

Main efforts towards improvement of the mall

1. Hiring of a Facilities Management Company that focuses on the shopping
mall's main operations such as maintenance, cleaning and security.
2. Usage of BRMALLS' Commercial Team extensive network to reduce the
vacancy of the mall.
3. Outsourcing of the parking activity through the hiring of a dedicated
service provider;
4. Inclusion of the mall in BRMALLS' marketing campaigns; and
5. Hiring of GL Events, multinational French company specialized in the
management of convention centers to manage Embratel Convention Center.

Asset Valuation

In February, 2007 BRMALLS paid the amount of R$108.8 million for 100% of the mall and convention center. The valuation expected an unleveraged real IRR of 12.2% p.y. BRMALLS financed a large portion of the acquisition with a R$70 million loan with Banco Itau. This is a 12 years loan with monthly amortizations and a 12 month grace period maturing on March 2019. The loan pays quarterly interest at IGPM + 9.75% p.y. The expected leveraged return in February 2007 was 19.2% p.y. The same projections reflected an estimated cap rate of 10.8% in 2007 and 12.6% in 2008.

Due to the efforts mentioned above, the mall has achieved a NOI much higher than last year's figures and above the initial projections made during the acquisition, as showed below. The estimated leveraged IRR, considering the actual NOI in 2007, is today, 17.1% (using the same premises used in the acquisition), while the leveraged IRR is 30.5% p.y. The current cap rate for 2007 and 2008, is respectively, 12.4% and 14.9%.

For further information please access: www.brmalls.com.br/ir.

First Call Analyst:
FCMN Contact:

Source: BRMALLS Participacoes S.A.

CONTACT: Renata Motta, IR Manager, +55 11 35293640

Web site: http://www.brmalls.com.br/ir

2008-05-12 19:30:04 0359460 PRNEWSWIRE