Exxon Mobil maximizes value of land in Ipanema in sale process coordinated by Ocupantes

The Company

Exxon Mobil Corporation is a United States multinational oil and gas company headquartered in Irving, Dallas County in the state of Texas. Exxon Mobil was formed on November 30, 1999 in the merger of Exxon and Mobil, two companies resulting from the split of Standard Oil Company in 1911. Exxon Mobil Corporation currently operates in the market under the ExxonMobil brand, and also operates the Exxon, Mobil, and Esso brands.

Its Brazilian headquarters is in the city of Rio de Janeiro. In mid-2003, a support center was created in Curitiba, which serves the company’s various operations both locally and around the world, mainly with information technology and controlling services.

Ocupantes coordinated the sale process of the last beach front property available for development, in Ipanema, Rio de Janeiro. The transaction resulted in the highest sale price per square meter in Brazil. Through an international partnership, Ocupantes was retained by Exxon Mobil, owner of the Esso brand, to coordinate the demobilization of its surplus land throughout the country. Among this land, Ocupantes began the process for a specific site, where an Esso gas station was still in operation and was to be deactivated. The 760 m² site is located on Vieira Souto Avenue, in Ipanema, one of the most noble addresses in the city of Rio de Janeiro, facing the sea and next to a large green area, known as Jardim de Alá. To maximize the sale value of this site, Ocupantes, together with Esso, opted to undertake the sale through a bidding process that was coordinated by Ocupantes.

First, Ocupantes undertook a comparative analysis of the best use (residential, commercial, hotel/flat, retail) to identify the vocation of the site. The result pointed to a residential development, given the demand for very high standard apartments in the region and the fact that this was the last remaining land in Ipanema, facing the sea, available for development. Considering this scenario, Ocupantes undertook a valuation of the site through the preparation of a discounted cash flow, considering the point of view of a developer. This allowed Ocupantes to verify the maximum possible values to make a residential development at that address viable.

Ocupantes’ demobilisation team began the Bid Process by inviting several companies, national and multinational, to participate in the process. Among those invited were developers and investors in the real estate market, as well as individuals interested in exploring the land. After the publicity phase, the interested parties registered themselves and received a public notice with all the information about the process, such as the characteristics of the land, the rules of procedure, documentation, and the minimum price, which was pre-established based on the evaluation that had been prepared.

The result could not have been better. The applicants presented proposals, in accordance with the rules of the bidding, in sealed envelopes. Ocupantes carefully analyzed the documentation and selected, together with Esso, the best commercial proposal. In June 2007, after all the procedures were completed and with a sale price 24% higher than the minimum pre-established price, the sale was concluded to an investor in the Rio de Janeiro real estate market. The sale price per square meter of this land is considered to be the highest in Brazil to date.

One of the major challenges of the Bid Process overcome by Ocupantes was to manage, concomitantly, the deactivation of the filling station, with a pre-established timetable that would not affect the sale of the land. Ocupantes successfully coordinated the process, harmonizing the timetable for sale of the land with that for deactivation of the filling station, resulting in one of the best sales in Brazil.