Alto Leblon Awaits Rocinha UPP

By Samuel Novacich, Contributing Reporter

RIO DE JANEIRO, BRAZIL – Throughout Rio, the implantation of UPPs in favelas have had predictable affects on bordering middle- and upper-class communities. As reported earlier, Santa Teresa is in the midst of a property boom, as real estate prices soar with the recent inauguration of UPPs in the favela communities of Prazeres and Escondidinho.

Many are anticipating what will happen when the favelas that still don’t have UPPs are “pacified”, and the effects on the surrounding real estate.

In the upper-class neighborhood of Alto Leblon, residents may look to Rocinha and the smaller bordering favela of Chácara do Céu with disdain.

Both territories are without UPP, and like most favelas throughout the city, their populations are on the rise. For decades, Rocinha has expanded, its territory first pressing up against São Conrado, and now edging its way into Alto Leblon.

Alto Leblon, normally ranking among the highest in the city with respect to property value and “rentability,” has experienced recent slumps in real estate values. Many are quick to blame the encroaching Rocinha favela as a main culprit, and with some justification.

Alto Leblon residents have long been concerned with drug trafficking violence in Rocinha, specifically citing the use of their neighborhood by drug traffickers as a potential escape route during gun battles. Over the years, attempts have been made to contain expansion of the favela.

Walls have been constructed to physically restrict Rocinha’s growth into the neighboring Mata Atlântica (Atlantic Forest), with one such project debated heavily in 2009 and strongly opposed by favela residents. However, Rocinha’s growth is not the only, or even the most important factor in Alto Leblon’s real estate woes.

Research by the Sindicato da Habitacão Rio de Janeiro (Rio de Janeiro’s Housing Syndicate, Secovi) highlights real estate availability and booms throughout the rest of the city as explanation of sluggish growth in normally strong neighborhoods.

This brings us back to the UPPs. The increase in property values and desirability in Santa Teresa was not an isolated experience. Real estate values have increased throughout the city, the result of both UPP installations and the impending Olympic Games and World Cup.

The inauguration of the city’s first UPP in Santa Marta resulted in higher property values in Botafogo (residential apartments now sell for an average R$6,475 per m2 according to Secovi), just as the UPP in Cidade de Deus drove up prices in Jacarépagua (R$1,925 per m2), and UPPs in the communities of Borel, Andarai, Formiga, Salueiro, and Turano led to an explosion in desire for real estate in Tijuca (R$3,761 per m2) and Vila Isabel (R$ 2,765 per m2).

Simply put, middle and upper-class Cariocas now have more options, and as a result, demand for real estate in Alto Leblon is not as high as it once was. Potential investors and renters can now choose from a greater array of neighborhoods, each with its own advantages.

Rocinha’s expansion certainly has an effect on real estate values in Alto Leblon, but so too does property fluctuation throughout Rio de Janeiro as a whole. Ultimately in the long term, residents of Alto Leblon can breathe easily, as they too stand to reap the indirect benefits of a UPP in Rocinha, although there seems to be no set date for that to happen.