One year ago, the Brazilian real estate sector was engulfed in uncertainties. After an exuberant growth period, the companies, both large and small, saw themselves before a crisis that promised to change the face of the market for the worst and seemed to have the potential to sweep financially weakened companies off the map. Enterprises were cancelled. Hundreds were fired. Banks were restricting credit to the maximum. Specialists were making somber projections. Buried under all the indexes and bewildered by what was happening in the world, most predicted a long and sever dry spell. It was during this moment of fear that the real estate market saw itself in face of a new and enigmatic character. The Spaniard Enrique Banuelos de Castro, an investor as rich as he is controversial, arrived in Brazil at the end of 2008 with the objective of buying companies and creating a real estate developer capable of competing with powerhouses like Cyrela, Elie Horn, and Gafisa, which includes American investor Sam Zell among its shareholders. Born in Sagunto, a small city on the coast with 60,000 inhabitants, located in the region of Valencia, 43 years old, about 5'7" tall, a seductive discourse and determined look in his eyes, Banuelos arrived in Sao Paulo with a personal fortune of around 2 billion dollars - and the uncomfortable fame of having been a lead player in the creation and destruction of a bubble that felled the Spanish real estate market in 2007. "When he arrived, I became apprehensive, like most people in the sector," says Sérgio Carettoni, a partner at the Sao Paulo company GAS Investimentos, which has minority shares in several Brazilian developers.

Banuelos has already signed contracts with Accor and the Jumeirah group to build more than 5,000 hotel rooms in Brazil

Almost one year has passed and the crisis wreaked much less havoc than the analysts had projected. The Brazilian real estate market continued being one of the most thriving in the world, and today analysts strongly recommend shares in the sector's companies. But Banuelos knew how to take more advantage than anyone of this period of fear. Over recent months, his company, Veremonte Participaçoes, invested nearly 500 million reais in four acquisitions. In December of 2008, he bought a 7% share in Agra, a Sao Paulo developer controlled by businessman Luiz Roberto Silveira Pinto. After that, he bought control of Abyara and Klabin Segall, medium sized companies that were facing cash flow problems and were on the verge of collapse. In September, Banuelos and Silveira Pinto bought the 20% share Elie Horn, owner of Cyrela, had in Agra. Finally, just a few weeks ago, Banuelos gathered all these companies under a single name - Agre, which emerges as the fifth largest company of a gigantic sector that moves 180 billion reais per year and is responsible for 6.2% of Brazil's GDP (see chart on page 26). Developers and real estate firms expect the greater offer of credit, the resumption of consumption by classes A and B and the drive of the federal government's popular housing program Minha Casa, Minha Vida, will kick off one of the most prosperous periods in the sector's history and transform the Brazilian market into one of the biggest opportunities in the world over coming years. "In 2010, the number of launches should be similar to 2007 and 2008, when sales were very strong," says Cristiane Amaral, partner at the consulting firm Ernst&Young, and responsible for the civil construction area.

In an exclusive interview with EXAME - the first with a Brazilian publication - Banuelos says his move in the real estate market is just the beginning. "Brazil is the big emerging country of the moment," he says. "For those who want to do business, it is even ahead of China." From many aspects, the Spaniard Banuelos is the personification of the foreign investor who begins to discover the country as a place to invest money and do business. Like Marcelo Telles, one of the controllers of the brewery AB InBev, recently affirmed: "I have never seen so much enthusiasm in relation to Brazil." Last year, direct foreign investments (those directed to the production sector) totaled 45 billion dollars, 350% more than the 10 billion dollars invested in 2003. Banuelos also affirms that the real estate sector should be the first out of several others that will receive monies from Veremonte. He has just signed two partnerships that will make him the biggest businessman in Brazil's hotel sector. One is with France's Accor. "Together we are going to invest 480 million reais in the construction of 4,880 popularly priced hotel rooms," says Banuelos. "Accor will handle the administration." The economic hotels shall be ready in three years and they will be built in inland and in small cities. Banuelos thus intends to gain from the regional growth of a country in which economic activity is still concentrated between Rio-Sao Paulo, but is beginning to move inland. The other partnership is with the Arab Emirates' royal family, which controls the Jumeirah hotel chain, owner of the Burj Al Arab, Dubai's postcard, among others. Banuelos will build 1,000 luxury hotel rooms in partnership with the sheikhs. These five and six star hotels will be built in Rio de Janeiro. In this case, Banuelos sees the opportunities offered by the World Cup and the 2016 Olympics. The hotel complex on the Sauípe Coast, in Bahia, is among his real estate acquisition targets. A deal was almost reached last year. (Besides increasing his operations in the real estate sector, the Sauípe Coast will help him enter the tourism sector. CVC, the largest tourism operator in the country is another target.)

Son of a steel worker who passed away when he was 9 years old and a housewife, Banuelos is described by friends as an ambitious man. His critics and enemies call him a megalomaniac. "He thinks big and talks as if doing deals worth millions was easy," says a real estate businessman with earnings of more than 1 billion reais per year and who was recently looked up by the Spaniard. "He has a scary attitude." Indeed, Banuelos is proficient when he lays out his investment plans. He involves his listeners with discourses filled with enthusiasm and ambitious plans. The real estate sector would be just one among several investments in Brazil. He says that in 2010 Veremonte will invest 2 billion reais in business tied to the health, energy, infrastructure, shopping mall, environment, food and real estate loan areas. Banuelos says the money will not all come from his personal fortune. A large part of the applied resources will come from American, European, Arab and Chinese investment funds - he will not reveal the names. His onslaught in several sectors - it is no accident they are all pointed to as having great growth potential over coming years - can be labeled a lack of focus or arrivism. But, for Banuelos, it is pure strategy. "I always start activities in a country through the real estate sector," he says. "Then, I move on to other sectors." That is what he did in Spain, where after creating Astroc, his real estate developer, he invested in the Union Fenosa energy company, the Sabadell Bank and the air taxi firm, Rentalia. He is now repeating the script in Brazil, Eastern Europe, Middle East and China.

Ever since he left Spain in 2007, Banuelos decided to team up with local partners and stay out of managing the companies in which he invested. Nor does he participate in boards of administration. Several executives heard by EXAME said that would be a way to avoid having his reputation as a controversial businessman - acquired after the Spanish real estate bubble burst - contaminate his business in Brazil. "Many companies and banks do not want to do business with him because they have misgivings," says an executive at a large developer. For the Spanish, Banuelos went quickly from a phenomenon of social mobility to a vital player in the current financial crisis. In 2006, Astroc, specialized in summer properties along the coast of Valencia, had become one of the country's largest developers. At the time, he specialized in buying lots in rural areas that were later transformed into urban regions. With the global credit spree, Spanish, English and Nordic investors began to buy their second home in the region. Astroc prospered. At the beginning of 2006, Banuelos decided to make the company public with the idea of transforming it into a national business. At the IPO, 25% of the shares offered were bought by large institutional investors, like Spanish businessman Amâncio Ortega, who owns the Zara retail chain. Launched at 9 dollars, the shares had jumped to 98 dollars less than nine months later. The search motivated Astroc to make another public offering, while keeping 51% of the capital. Banuelos rose to the third richest man in Spain and 95th richest in the world, with a fortune worth 7.7 billion dollars, according to the American magazine Forbes. In 2006, when he inaugurated his foundation geared towards social and artistic projects in New York, he offered paella for 28,000 guests or people just walking through Central Park.

Tourism Interested in buying or becoming a partner at CVC, the country's largest tourism operator

Leisure He has plans to buy and modernize the Jockey Club of Sao Paulo and Rio de Janeiro together with the Arab Emirates' royal family

Hotel Industry He is going to build more than 5000 hotel rooms starting in 2010 and he is interested in purchasing the Sauípe Coast complex in Bahia.

Environment He has plans to enter the business of selling carbon credits and is studying the purchase of forests

Energy Hydroelectric plants are one the businessman's targets. He already invests in the electric sector in Hungary.

His dream began to collapse in March 2007, when Astroc's shares became the target of strong speculation and began to fall. One month later, they were worth 4 dollars, obliging Banuelos to leave command of the company. The day after he left, the securities appreciated 39%. With the fall, the businessman became a sort of public enemy in the country. Attorney Felipe Izquierdo filed a lawsuit in Spanish courts accusing Banuelos of balance sheet fraud and of making transactions with related parties to increase the value of Astroc shares. Izquierdo was supposedly representing 50 investors (he doe not reveal their names) and calculates having lost 20,000 Euros with Astroc shares. The lawsuit was dismissed, reopened and has yet to be tried. At present, Banuelos has less than 5% of Afirma's shares, the company that succeeded Astroc, and he sold his 4% share in the Sabadell Bank. The attacks he has suffered since the bubble burst are the doings of Spanish conservatives, he says. Banuelos claims the country's high society never looked well upon the child of a common laborer, without any tradition, becoming one of the world's richest men.

Despite his distance from the day-to-day activities of his companies, it would be an error to treat Banuelos like a mere institutional investor. He is the one who defines his companies' strategy and growth plan. He then hands over execution to hand-chosen people. In Brazil, Banuelos has elected two men of confidence. One is Marcelo Parachinni, former vice-president of Santander Bank in Spain and Veremonte's main executive. He is the one who looks for new businesses in which the Spaniard can invest. The other is Silveira Pinto, his partner at Agre. Founder of Agra, he is considered one of the great developer managers in the country. His credibility at banks was also decisive in choosing the partnership. Silveira Pinto was responsible for negotiating the purchase of Abyara and Klabin Segall and for renegotiating their debt, of more than 1.2 billion reais, with banks. The purchase of the two developers revealed the daring way Banuelos and his envoys do business. There were no audit processes in any of the companies. The cash situation at both was so critical, quick action was needed. "They assumed the risk and took advantage of the moment prices were very low to buy two good companies undergoing problems," says Eduardo Silveira, civil construction analyst at Banco Fator.

After the Spanish real estate bubble burst, Banuelos' fortune fell from 7.7 billion to the current 2 billion dollars

For Banuleos, his cinematographic fall in his native land, Spain, represented not only a change in business strategy but also deeply affected his personal life. Veremonte's headquarters was moved to London. That is where Rentalia's executive jet, a Gulfstream 550, takes off from to take him around the world. His most frequent destination is Brazil, where he has already spent 160 days this year. Until the end of October, Banuelos used to stay at Sao Paulo hotels during his visits to the country. A few weeks ago, he moved to a penthouse apartment in Vila Nova Conceiçao, a noble district next to Ibirapuera Park (a half-marathon enthusiast, the businessman runs in the park whenever he can). When he is in the country, his relaxes by walking the streets of Sao Paulo. "I like to walk and don't know how to drive. So I walk a lot." His family still lives in Valencia. His wife works for the government as a tax agent. His daughters, 9 and 11, study in a normal school, have private lessons in Mandarin and lead a life as common as any billionaire girls can. "I want them growing up as normal children," says Banuelos. The businessman talks to the girls twice a day by videoconference. On weekends, he flies to Valencia or the family goes to London. The comfortable lifestyle Banuelos can offer his daughters contrasts greatly with his difficult childhood. After his father's death, victim of a work accident, he, his mother and sister went through financial difficulties. The company where his father worked paid for his studies, but there was not sufficient income for other family needs. "The food often finished before the end of the month," he says. He opened his first business at the age of 16 with three friends, Miel de Luna, a small honey factory. He created a real estate firm at 19. One decade later, his company already had a respectable size. That is how his life as an investor in the real estate market began. In 2005, his company was already worth 1 billion dollars.

Banuelos overcame misery, survived, although injured, the collapse of the Spanish market, and now, at the age of 43, he is trying to repeat his prosperous period in Brazil. "Little by little, he began showing his plans, investing his own money and overcoming misgivings," says Sérgio Carettoni, a minority shareholder at Agre. But Banuelos himself knows that to get rid of the dark clouds that follow him, he needs to make his plans become real businesses.