Meeting increased housing demand in Brazil by investing in novel building technologies

Emerging Market Governments Need to Address Housing Problem for Growing Population

Much of the exponential growth in global population projected for the next decades is driven by the expansion of developing economies in Latin America, Asia and Africa. With the middle class on the rise and much of the population migrating towards the urban centers of emerging markets, the pressing need for housing has become one of the most urgent items governments need to address. 17 of the 20 largest cities in the world are located in emerging markets. The exponential growth of these megacities has put infrastructure under pressure to accommodate rapidly growing numbers of people, often resulting in extremely poor living conditions as best demonstrated by slums. 

Brazil’s Economic Renaissance and Push for Affordable Housing 

One of the economies leading the way in making housing a top priority is Brazil. After battling with a recession between 2014 and 2017, the largest economy in South America has been growing since and is forecasted to expand at a rate of 2% in 2020. With a nominal GDP of R$6.826 trillion (US$1.868 trillion), Brazil is the 9th largest economy in the world. As a result of this successful economic turn-around, the construction sector of the country has also seen new life. The industry is forecasted to grow at 2.3% over the next 3-year period, after facing years of sluggishness and contraction. About one-third of current construction in the country is accounted for by residential developments, proving that the government is serious about its promises to provide housing for all Brazilians.

ARXX - Leading Sustainable Innovation in the Brazilian Construction Industry 

While environmental politics in Brazil have been highly controversial, meeting the pressing need for housing requires high quality, efficient and sustainable materials. True North has recognized the potential of innovative building technologies and joined forces with ARXX Building Products S.A. in 2018 as trusted partner for the companies’ series B financing round. 

ARXX has developed and brought to market insulating concrete form (ICF) blocks which are market-beating. They enable construction projects to be completed easier, quicker, with less waste, and the product itself is a much better insulator creating significant annual energy savings over the life of the building. Furthermore, it is price competitive to traditional brick and mortar construction materials.

Having passed a rigorous certification and regulatory process, ARXX is currently uncontested in its market segment and has seen its sales pipeline grow to over 3 months and over R$50M (ca. CA$12M). True North is excited to see the growth of ARXX in the coming year.