The retail market has been positively impacted by the continued economic recovery, with 2010 GDP growing 7.5% versus 2009. Credit as a percentage of GDP is currently at an all-time high of 47%, up from 25% in 2004, as home and consumer financing becomes increasingly available to a greater percentage of the population. Household real wage growth experienced a 7.1% year-over-year (“YOY”) increase in December 2010. This trend supports our belief that Brazil’s economy should maintain a long-term, healthy upward trajectory.

Notwithstanding the Central Bank´s tightening monetary policy, we expect consumer spending to continue to drive sales at our properties, as evidenced by record low unemployment, increasing household income, expanding consumer credit, and high levels of consumer confidence. Retail sales saw strong growth in 2010. Holiday season sales topped estimates and grew 15.6% as compared to December 2009. In 2010, non-auto retail sales growth accelerated to a 14.5% year over year increase.

The market continues to be active in development, as several shopping center companies continue to announce new expansions and greenfield projects. Despite some M&A activity in the market, meaningful acquisition opportunities are lacking, which is expected to be beneficial to the Fund as we continue to execute on our asset sale strategy and prepare for our future exit strategy.