Types of Brazilian REITs: Brick, Paper, Hybrid, FOF

Brick FIIs are the most traditional — they buy and manage real properties.

Logistics (Warehouses) Invest in logistics warehouses and distribution centers. Grew significantly with e-commerce. Long contracts (5-10 years), large tenants (Amazon, Mercado Livre, DHL). - Pros: long contracts, low vacancy - Cons: concentration in few tenants - Examples: HGLG11, XPLG11, BRCO11

Shopping Centers Invest in shopping malls. Income from store rent + percentage of sales. - Pros: tenant diversification, predictable cash flow - Cons: sensitive to economic crises and changing habits - Examples: VISC11, XPML11, HSML11

Corporate (Offices) Commercial buildings and office towers. Income from corporate rent. - Pros: long contracts with large companies - Cons: remote work reduced demand in some markets - Examples: HGRE11, BRCR11, PVBI11

Urban Income Diversified urban properties: supermarkets, bank branches, stores. - Pros: atypical (long) contracts, resilient tenants - Cons: lower appreciation potential - Examples: TRXF11, HGRU11

Agro Rural properties and agribusiness-related. - Pros: growing sector in Brazil - Cons: newer sector, less track record - Examples: RURA11

Paper FIIs Don't buy properties — invest in real estate debt securities (CRIs, LCIs, LHs). - Income usually linked to CDI or IPCA - When Selic rises, dividends increase - When Selic falls, dividends decrease - Less vacancy risk (no physical property) - More credit risk (borrower default) - Examples: KNCR11, KNIP11, MXRF11, HGCR11

Hybrid FIIs Combination of brick and paper. Offer natural diversification. - Examples: KNRI11, HGBS11

FOFs (Fund of Funds) Invest in shares of other FIIs. Useful for automatic diversification. - Pros: professional management, automatic diversification - Cons: double layer of fees - Examples: BCFF11, KFOF11

In PaxMoney, each type is automatically identified so you can see exactly how your FII portfolio is distributed — by fund type, sector, and risk.