North Coast of Santa Catarina is experiencing economic boom

Anyone traveling along the North Coast of Santa Catarina sees a scene of transformation in the region’s cities. The pace of work is frenetic, both in the central regions and on the banks of the main highways, such as BR-101, where warehouses, warehouses and business condominiums are being built. The region is experiencing a demographic and economic boom.

Two of the cities in the region, Itapoá and Barra Velha, are among the seven that grew the most in population in the country between the 2010 and 2022 censuses, points out the Brazilian Institute of Geography and Statistics (IBGE). The average growth rate was more than 6% per year, which means that the population more than doubled during the period. Brazil’s population expansion over these 12 years was 0.5% per year, and the average for the entire state of Santa Catarina was 1.7%.

Private investments in cities and surrounding areas contributed to this scenario. The Gross Domestic Product (GDP) of the eight cities in the region – Itapoá, São Francisco do Sul, Balneário Barra do Sul, Araquari, Barra Velha, Piçarras and Penha – grew at an average of 7.53% per year between 2002 and 2020 ( last available data), almost four times the national average in the period (1.97% per year).

The North Coast also benefited from the expansion of economic activity in nearby centers, such as Joinville and Jaraguá do Sul. Logistical issues also favor the region: within a radius of 200 kilometers, there are four airports (Curitiba, Joinville, Navegantes and Florianópolis) and five ports (Paranaguá, Itapoá, São Francisco do Sul, Navegantes and Itajaí).

Another attraction are the beaches in the region. The lack of land availability and high property prices in Balneário Camboriú, where the price per square meter can exceed R$ 32 thousand in high-end buildings facing the sea, is driving investments in the real estate sector to other cities of the North Coast of Santa Catarina.

“It’s an area that’s booming,” says Thales Silva, commercial director of the construction company Rôgga, from Joinville, which has a strong presence on the North Coast. The company expects to reach an overall sales value of R$1 billion in 2024.

The combination of business hubs and ports has an impact on another front in construction: the emergence of large warehouses and complexes focused on logistics operations. “The segment is expanding rapidly and is professionalizing very quickly. There has been a lot of progress since the pandemic”, says Jonas Tilp, a specialist in properties for corporate purposes.

The trend towards a reduction in the Selic rate could also provide an additional stimulus for the civil construction and real estate segments. Since August, the Central Bank’s Monetary Policy Committee (Copom) has been promoting reductions in the economy’s basic interest rates. The rate went from 13.75% per year to 12.25% at the beginning of November, and the BC signals further cuts ahead.

The Rôgga executive explains that the drop in the Selic gives greater stimulus to real estate credit: “The cost of financing falls and increases the purchasing power of customers”.

Itapoá had the fifth highest population growth in the country

One of the examples of transformation in the region is experienced by Itapoá, with more than 30 thousand inhabitants, and which had the fifth highest demographic growth among Brazilian municipalities.

According to consultant Osvaldo Aly Júnior, from Arkhe, two factors were decisive for this turnaround: the duplication of BR-101 and the arrival of Porto Itapoá. “There was a synergistic effect between these factors and the development of Itapoá, which generated opportunities for the municipality to grow economically with the conditions to manage this process”, he says.

Since 2011, when the port terminal was opened, R$2 billion have been invested and 7,000 direct and indirect jobs have been created. According to the president of Porto Itapoá, Cássio Schreiner, another R$2 billion in investments are planned for the next ten years. “The flow will depend on the growth in demand,” he says.

For 2024, a 10% growth in cargo movement for export and import is expected. This year, the terminal has already handled 1.1 million TEUs (a measurement equivalent to a 20-foot container).

“With the port came more companies in the segment. This generated more resources for the city”, highlights the municipality’s Development Secretary, Sérgio Grassi.

He highlights that expectations are favorable for the city. There are plans to build a new port terminal, from the Paraná cooperative Coamo, the largest in Brazil. Investments are estimated at R$1 billion and include the construction of three berths for grains, fertilizers, liquids and gas. There is still no deadline for the start of works.

“The announcement of the installation of a new private port, in addition to the expansion of the Itapoá terminal and investments in doubling access to the site, are important attractions for civil construction, but they are not the only ones. It also has beautiful landscapes and a strong tourist appeal”, says the president of the Construction Industry Union of Joinville and Region (Sinduscon), Carlos Lopes.

Itapoá also reformulated its master plan. Last year, the local City Council approved the onerous grant, which allows the construction of taller buildings.

One of the construction companies taking advantage of the opportunity is Grassi Zapellini, which recently launched a 17-story building with 59 apartments. “After Covid, many people started to prioritize quality of life, which benefited the city”, says partner Gerson Grassi.

Business expansion favors Barra Velha

Barra Velha also experienced a demographic boom, which, according to IBGE, had the seventh highest population growth in the country between 2010 and 2022. The number of inhabitants between the censuses jumped from 22.4 thousand to 45.4 thousand .

Large companies have set up shop in the region. The city received one of the largest distribution centers for retailer Havan and also a factory for the multinational Cebrace, which manufactures glass for the automobile industry. Nearby, just over 20 km north along BR-101, in neighboring Araquari, is the only factory in Latin America of the German luxury car manufacturer BMW, and a synthetic yarn factory owned by Hyosung, a Korean conglomerate.

“The economic expansion and ease of access via BR-101 have made Barra Velha an attractive city”, highlights Silva, from Rôgga. People from Paraná and São Paulo are among the construction company’s main customers.

Another point he highlights is that the location, as well as Balneário Piçarras and Penha, is opposite the highway for those arriving via Navegantes airport, the second busiest in Santa Catarina and widely used by those visiting Beto Carrero World, a one of the main theme parks in the country and located in Penha.

Accelerated growth poses challenges to the region

Rosana Silva dos Reis, professor of Architecture and Urbanism at UniSociesc, highlights that this accelerated growth imposes a series of challenges on the region, such as water and energy supply, access to sewage, and drainage. Others are health and teaching units.

According to Reis, the North Coast of Santa Catarina has few water sources and faces problems of lack of energy at times like the end of the year. A major concern is also the tendency for the soil to become waterproof, which can lead to flooding.

“More people demand more sewage, water and energy. It requires reinforcement in urban planning so that cities do not collapse”, she highlights.

Another concern of the professor is with the process of gentrification, in which low-income urban areas undergo revitalization and appreciation, often forcing local residents to leave and replacing them with people with greater purchasing power, which can lead to the transformation of the community identity and culture.