HBRE3

HBR Realty Empreendimentos S.A. is a real estate company focused on urban income-generating assets, with common shares traded on B3 under the ticker HBRE3. Founded in December 2011 as the urban income arm of the Borenstein family, the company is built on the experience of the Hélio Borenstein S.A. group, which has been active in the Brazilian real estate market since 1961. Initially based in Mogi das Cruzes (SP), HBR Realty structured its growth around the development and acquisition of properties for lease, consolidating a portfolio of urban properties that includes convenience centers, shopping malls, corporate developments, and complementary assets. The entry of Dynamo in 2014 as a partner, through a contribution of assets and capital, strengthened corporate governance and enhanced the company’s ability to accelerate its expansion plan. In 2021, HBR Realty joined the Brazilian capital markets with its listing on B3, in an offering that enabled it to raise significant funds to support the growth of its business platforms.

HBR Realty’s business model is centered on generating recurring rental income through the development, acquisition, management, and eventual recycling of assets. The company operates across the entire real estate cycle, from land sourcing and financial and legal feasibility analysis, through architectural design, licensing, construction, marketing of leasable areas, and operational management of the properties. An in-house new business unit coordinates the identification of opportunities and project structuring, which are evaluated by a dedicated committee that considers expected returns, capital structure, and value creation potential. The strategy also includes the selective sale of assets that have reached an advanced stage of maturity and appreciation, freeing up capital for new investments, which adds dynamism to the portfolio composition.

HBR Realty’s operations are organized into four asset platforms that summarize its operating segments: ComVem, HBR 3A, HBR Malls, and HBR Opportunities. ComVem is the convenience center platform, made up of developments focused on essential services and convenience, typically located in densely populated, high-income neighborhoods, especially in the city of São Paulo. These assets can be developed as stand-alone projects or in partnerships with developers, placing the stores on the ground floors of residential projects with active frontages. The HBR 3A platform concentrates AAA-standard office floors in prime areas of São Paulo’s capital, such as Faria Lima, Pinheiros, Itaim Bibi, and Chucri Zaidan, prioritizing the development of high-standard office buildings over the simple acquisition of ready-made assets. HBR Malls comprises shopping centers acquired or developed by the company, focusing on dominant projects in their regions, such as Shopping Mogi, Suzano Shopping, and Shopping Patteo Olinda, where the strategy is to capture value through management improvements and commercial repositioning. Finally, HBR Opportunities concentrates complementary and opportunistic assets, including hotels, self-storage operations under the +Box brand, built-to-suit developments, sale-leaseback operations, and parking facilities.

HBR Realty’s revenue distribution shows a relatively diversified portfolio across its platforms. In 2024, consolidated net revenue was mainly composed of the shopping center segment (HBR Malls), opportunistic assets (HBR Opportunities), corporate office floors (HBR 3A), and convenience centers (ComVem). The shopping center segment accounted for a significant share of revenue, followed by opportunistic assets, which include hotels and self-storage. Corporate office floors also made an important contribution to revenue, with emphasis on the presence of a single corporate tenant responsible for more than 10% of net revenue in 2024. The convenience centers in the ComVem platform have been gradually increasing their share, accompanying the expansion in the number of developments, but still represent a smaller slice compared with the other main segments.

HBR Realty’s geographic footprint is concentrated in Brazil, with a strong presence in the state of São Paulo and selective expansion into other relevant urban markets. The company’s origins are in Mogi das Cruzes, where it consolidated assets such as Shopping Mogi and Shopping Patteo Urupema, and its strategy was progressively expanded to the city of São Paulo, the metropolitan region, and other states. The ComVem platform concentrates a large part of its developments in the city of São Paulo, leveraging a regulatory environment that encourages active frontages and mixed-use projects, but also includes assets in cities such as Guarulhos and in other states, such as ComVem Ecoville in Curitiba (PR) and ComVem Olinda (PE). In the Northeast, the company developed Shopping Patteo Olinda in Pernambuco, and in the prime urban corridor of São Paulo’s capital it added assets such as the HBR 3A Faria Lima office tower, corporate projects in Pinheiros and Itaim Bibi, and the W São Paulo Hotel in Vila Olímpia. In 2024, HBR Realty reached 48 operating developments, with a total gross leasable area of 240,674 m², with no revenue from foreign customers.

HBR Realty’s competitive positioning combines specialized exposure to urban income-generating properties with a focus on strategic locations and active asset management. In the ComVem convenience centers, the company seeks to harness urban density and retailers’ omnichannel demands, offering spaces that support physical and digital operations, last-mile delivery, and formats such as pick-up-in-store, with a tenant mix that includes pharmacies, fast-food chains, neighborhood supermarkets, and various services. In corporate office floors, the strategy is based on the perception of a relative scarcity of AAA properties in São Paulo’s prime areas and on the ability to develop more complex projects, from land acquisition to leasing, exploring value arbitrage and returns over development cost. In shopping centers, the company focuses on assets with a dominant position in their catchment areas, seeking operational efficiency gains, tenant mix review, and growth in ancillary revenues, all subject to the seasonal nature of retail in holiday periods.

From a regulatory standpoint, HBR Realty’s activities are subject to a broad set of federal, state, and municipal rules related to real estate development, zoning, urban land use, environment, historical heritage, leasing, and condominium law. The company must obtain and maintain operating licenses issued by municipalities, Fire Department inspection certificates (AVCB), occupancy permits (Habite-se), environmental licenses, and authorizations for the use of water resources, among others. In the shopping center segment, the legal structuring of the projects may take place through a building condominium (condomínio edilício) or a civil condominium, which affects how the company relates to tenants and co-owners. The company is also subject to personal data protection laws, especially the General Data Protection Law (LGPD), and to oversight by the National Data Protection Authority (ANPD) with regard to the processing of data from customers, visitors, and users of its properties.

With respect to environmental, social, and governance (ESG) practices, HBR Realty has been structuring an approach based on identifying the impacts of its activities and being transparent with stakeholders. The company publishes an Annual Sustainability Report, prepared in accordance with the Core option of the GRI standard, in which it reports performance indicators related to material topics defined in its materiality matrix. This report considers United Nations Sustainable Development Goals (SDGs) deemed relevant to the business, such as good health and quality education, decent work and economic growth, innovation and infrastructure, reduced inequalities, sustainable cities and communities, climate action, life on land, peace, justice, and partnerships. The company is in the process of structuring its greenhouse gas emissions inventory, with the intention of starting to measure emissions in different scopes, reinforcing the integration of climate aspects into the management of its real estate assets, even though the report does not yet follow TCFD recommendations or a specific external assurance framework for the ESG information disclosed.

Over the course of its history, HBR Realty has built a portfolio of urban income-generating properties that includes convenience centers, shopping centers, corporate developments, hotels, self-storage, and other specialized assets, anchored in a combination of in-house real estate development, selective acquisitions, and active management. HBRE3 shares provide exposure to this set of income-generating real estate assets concentrated in large urban centers, particularly in the city and state of São Paulo, with diversification across retail, services, lodging, and high-end office segments. Operating across multiple platforms allows the company to reallocate capital according to market conditions in each asset class, while maintaining a focus on generating recurring rental income and on the long-term appreciation of its properties.