Good morning, ladies and gentlemen. Welcome to Multiplan's conference call regarding the results of the fourth quarter of 2019. We have with us Mr. José Isaac Peres, Chief Executive Officer, Mr. Armando d'Almeida Neto, Chief Financial Officer and Investor Relations Officer, Mr. Marcello Barnes, CIO, Mr. Hans Melchers, RM Planning Director, and Mr. Franco Carrion, IR Manager. We would like to inform you that the presentation to be made is available for download at ir.multiplan.com.br. We would like to inform you that participants will be in listen-only mode during the company's presentation. Afterwards, we will have a Q&A session when further instructions will be given. Should you need assistance during the call, please press star zero two to reach the operator.
Before proceeding, we would like to clarify that the forward-looking statements that might be made during this call in relation to the company's business perspectives, operating and financial projections and targets, are beliefs and assumptions of Multiplan's management, as well as information currently available to the company. Forward-looking statements are not guarantees of performance. They involve risks, uncertainties, and assumptions, as they refer to future events and therefore depend on circumstances that may or may not occur. Investors should understand that general economic conditions, industry conditions, and other operating factors may affect the future results of the company and may lead to results that differ materially from those expressed in such forward-looking statements. This call will last 60 minutes. After this period, the investor relations area will be available to you should you still have doubts.
Now, we would like to turn the floor over to Mr. José Isaac Peres, Chief Executive Officer, who will start the presentation. Mr. Peres, good morning. Thank you for the opportunity, and you may proceed.
Good morning, everybody. Ladies, gentlemen, and thank you for your patience to participate in our call. I would like to mention that I made a recent surgery on one of my eyes, and I can barely see, but very soon I will be able to see with two eyes, okay? I would like to say that we are presenting our results of 2019, which was a year of major transformations in Brazil. A year of strengthening, mainly of our own company and Multiplan. In these 45 years of existence had the joy of reaching this moment when the economy is recovering, and the economy is giving very positive signs.
I see the number of executive jets that are flying in our skies. In the last few years, I have flown a lot in Brazil, and I reach the airport, and there was nobody else. Recently I went to Curitiba because we carried out an expansion of one of our malls, and I got to Curitiba, and the manager said, "Well, things are fantastic here. You can see how many private jets are flying." This is a concrete sign that the economy is really soaring or taking off in an analogy. I see the aircraft lease and even the one that I use once in a while, has a very high demand today, and we have no doubt whatsoever that Brazil will be taking off really in the next few years, and now.
But I would like to say that we have celebrated 45 years of age, and in the current scenario, we see a much more positive situation. We are seeking more and more to improve our activity, to upgrade it. The results that we obtained this year once again show that we were able to find a path towards growth. The adjusted net income of the company or the NOI of the company exceeded BRL 1.5 billion. With a lot of work done with the mix and the offering of new solutions in order to solve not only our lives but also our consumers' lives, because our focus are our customers, our clients, and as I repeat all the time, God is the consumer, and the tenants are the kings, and we are only service providers. Our occupancy rate exceeded. The adjusted net income was BRL 1.5 billion , correcting.
Our occupancy rate, it was 98%, so we have recovered that. It is almost impossible for those who understand shopping centers. It's almost impossible to imagine that you will have 100% occupancy rate if you have one anchor store levy, you have to adjust it down to 1% or 2%. The quality of our portfolio and the gradual recovery of consumption accelerated the sales of our stores. That reached a new record. This year, up to December 19, sales reached BRL 16.3 billion, growing by 5.4%. You could maybe say, "Well, maybe 5.4 is not so much. It should be 10 or 15." But you must see that we have 4% interest rate and a growth rate of about 3%. So every time we have 10%, it is exceptional. It's outstanding.
When we look at the last 10 years, we can see that even with a challenging decade, almost a lost decade, our malls posted sales increase almost every year. The NOI of these assets more than tripled in the period. Although it was a very difficult decade, and with the real growth much higher than inflation. Today, we see a wider avenue for private initiative contributing towards the increase of efficiency and the expansion of investment in Brazil, generating new jobs and reinforcing the basis for society. Multiplan never stopped investing, and we have always done that. Last year, if I'm not mistaken, we invested about BRL 987 million. This year, I believe that we have already announced about BRL 1 billion in investments to be made this year. Another important fact is that we have a GLA of 921,000 sq m, and we will reach 960,000 sqm of GLA, which are Jacarepaguá.
On the other hand, it's important to see that we have 820,000 sq m of land acquired by the company at a low book value. These are areas that are neighboring to our projects, and we will have built area or floor area of 1 million sq m in the next two years. We have 820,000 sq m in our land bank. With a coefficient of one time the use of the land, and even with one time, this could represent for the company the realization of BRL 10 billion in projects in the next two years. The project alone that we are going to start this year in Porto Alegre, integrated to our shopping in the south, BarraShoppingSul.
We have a project that represents an investment over 10 years' time or a PSV of BRL 3 billion with BRL 1 billion in income. It is similar to what we did in Rio, the Golden Green. This is a very good project, and it took us 10 years to do that. We are doing this as we sell. We do not have the intention of launching 10 or 20 buildings at one time. This is a top-quality project. It is fully integrated. It is a closed condominium and with approximately 19. Neighboring our shopping center in Porto Alegre, 19 buildings. I would like to draw your attention to some data. I have a problem with my eyesight, as I have already said. Let's see. We had an adjusted net income of BRL 536 billion, and this adjustment is made based on the appreciation of our shares.
If it were not that, it would be BRL 536 million. BRL 470 net, v ery close to what we had last year, but this year we had an appreciation of 36% in our shares, and this had an impact on the financial result or the accounting result and not the financial result. I would like to mention a few points that I consider as important as the ones that I have already mentioned. BH Shopping is one of the five first shopping that we built, and it had positive growth of 7% in sales last year. We have a 100% stake in this shopping center, the Morumbi Shopping Center, very important, one of the first that we built. 10% increase in this quarter. In BarraShopping, growing by 7.5% in spite of all the difficulties in Rio de Janeiro that everybody is aware of.
Our newest shopping center, the ParkShopping Canoas, grew by 15.9% in sales, which is a very important fact as well. Another important point is our investment in terms of sustainability, and we see with a lot of joy the result of our photovoltaic plant that today supplies 100% of the clean energy to this shopping center and the Village Mall. We have also the ParkJacarepaguá, another green project that will start totally integrated to nature with high sustainability. This year, we started to expand this ParkShoppingBarigü i, and we have an additional 150,000 sqm to develop, and some have already been announced. Another relevant fact is the acquisition of the Diamond Mall. We are starting the expansion of the floor area of this shopping center this year. In the last 12 months, we announced investments amounting to almost BRL 1 billion.
It is almost the largest investment ever made by the company ever since it became a listed company during a one-year period. I believe that our investments will be even higher. We made these investments without waiving the modernization of the shopping centers that are already in operation and maintaining our commitment to generate more and more pleasure to people and integrating into our products more services, leisure, and culture options. I would like to draw your attention to a recent initiative. We took over the management of the theater located in the Village Mall, and now it has a new name, Teatro Multiplan, because we are the sponsors, and we are re-qualifying the content and making investments in culture and incentivizing art.
Multiplan starts to operate its own theater with the objective of bringing new shows and improving the quality of the cultural events that are held there. Another point that is of great importance to us is the partnership that we established with the Delivery Center into the pioneer and the integration of the physical world with the digital world. Last month, we announced a new investment in this company, the Delivery Center, and this operation has been contributing towards the success of our super app named Multi, which will be even more important in mid-July this year, and that already has 160,000 downloads. Delivery Center guarantees logistic excellence to the super app delivery service and one of the many functionalities offered by the company. I would like to mention that still in 2019, we paid BRL 280 million to our shareholders as interest on the equity.
I would like to thank you all very much. This is very encouraging. The company has started again the investments, and during this year, we will probably have new investments, and we expect to keep this level of development, of quality, always focusing on the consumers and adapting to the new consumption needs that are totally different than the ones that we had 10 years ago already. For this reason, we continue to invest a lot in technology, and we understand that the apps that we will be offering will be facilitators to our consumers. Of course, offering our tenants almost a virtual store. Our tenants will continue to have their brick-and-mortar stores plus the virtual stores. We are already working hands-on, on this project, and we intend to start this this year. I would like to thank you all very much.
Our employees, our tenants, our investors, and everybody that participate in this ongoing growth process. I would like to thank you for your confidence, those of you who have been following us during all these years. I apologize for the difficult reading that I delivered this year because I have problems reading with one eye only. But very soon, I will have the two eyes very wide open. Now, d'Almeida. Armando d'Almeida.
Good morning. It's a very big challenge to summarize the many highlights that I would like to mention for the fourth quarter. On the operating aspect, when compared to Q4 2018, we see a growth in sales of 6.8%, with same-store sales of 5.8%. Rental revenue increased by 5.5%, whereas same-store rent was 8.3%.
If you read our report, you see the change in the weight of the segment in the mix of our stores over the years, especially with the increase in the services, entertainment, and food segments. This brought about a higher distribution of sales or a different one over the year. That is to see a lower concentration in December. More and more over the years with this change in mix, we see a different distribution. Another relevant point where the sales occur during the Black Friday, growing in importance in Brazil and representing more in our overall sales. The occupancy rate, as Mr. Peres said, was 98%, the highest since the first quarter of 2016. The occupancy cost dropped by 15 basis points to 11.6%, very positive, very favorable. One of the reasons for that was the photovoltaic plant.
But in fact, it is a process of reducing our condominium costs gradually, it was 5 points lower in the year, less by going to 12.6%. The NOI grew 4.7% to the quarter, reaching BRL 1.2 billion in the year. EBITDA growing by 9.9% to the quarter, reaching nothing than BRL 332 million in 2019. And net income growing by 26.3%, reaching BRL 471 million also in 2019. As Mr. Peres said, if adjusted by the shares, BRL 531 million. This year, we gave back to our shareholders BRL 280 million in interest on equity, the highest amount ever distributed by the company, and we invested an addition of BRL 787 million, primarily in acquisition of minority stakes in our shopping centers, development of new projects, and revitalization.
In this amount that we announced, we have not included the pre-emptive right, the exercise of the pre-emptive right in the fourth quarter, the stake in ParkShopping, RibeirãoShopping Center, as well as the acquisition of 50.1% in Diamond Mall. That was closed in January 2020 and not in 2019. Net debt of the company closed the year at 2.39 x the EBITDA, whereas the average weighted cost of the gross debt was 5.4%, 85 basis points higher than the Selic rate, 4.5%. That closed the year in 4.5 and now 4.25. Certainly, the lowest rate paid over the 45 years of age of the company. I would like to mention as well that between September and December 2019, we renegotiated BRL 820 million in debt, representing savings at present value for the company of BRL 50.5 million.
Due to the scheduled payment of interest on equity and the settlement of the pre-emptive rights already announced, we expect the financial leverage slightly higher than at the beginning of 2020. It is good to have this when you have the lowest interest rate ever in the country. Multi, our super app, developed to be useful and relevant for people that are already clients of the Multiplan shopping centers, had 160,000 downloads. We launched the super app in August. July, August, September, and by the end of the year, 160,000 downloads overall in this very short span of time. All our shopping centers are present at the app, 19 shopping centers, and the app is present with many functionalities, and in four of them, with already integrated sales.
The idea is to expand this over time, and we will continue to add new functionalities, making Multi more and more relevant, more important for the people who come to our shopping centers. We have also brought some case studies in our report. We try to show the value created and the resilience of properties that are well-located and well-managed over the years. I would like to highlight the case that is on page, if I am not mistaken, 17 of our report that shows the strong growth of sales and NOI over the years, and also the study that is on page 25 of the report that shows the evolution of the NOI yield. The yield, the return that they have when compared to the invested CapEx.
T he seven projects, five shopping centers and two towers delivered between 2011, 2013, consolidated at a very difficult moment, but we are consolidated, already giving a return of 15.4% in 2019. W hen the Selic was 4.5, this shows the value creation, the value generation by means of these developments. I believe that these studies show the attractiveness over time of the development of new projects, and also they encourage us to tap into the many growth opportunities that we have in our company. We thank you very much for your support, for your interest, and now we would like to open the Q&A session. Thank you very much.
Ladies and gentlemen, now we will have a Q&A session. In order to ask a question, please press star nine. The first question is from Luis Stacchini from Credit Suisse. Good morning, Luis.
Good morning, everybody. Thank you, Mr. Peres. I have two questions. The first is related to investments. You have increased the number of announcements of acquisitions and minority stakes and new projects, and I would like to know what you intend to do in the scenario of reduction in the cost of debt and lower interest rates, and to which extent do you see Multiplan reaching net debt EBITDA ratio. That is to say, when you have the opportunity, where do we intend to go in this sense or what would be the limit. Do you have an expectation of the launch of the first phase, and what would be reasonable to expect in terms of gross margin in this project. Thank you very much.
Luis, this is José Isaac Peres. I'm answering your question about the Golden Lake project. The Golden Lake project is located in 180,000 sqm in the surface next to the BarraShoppingSul or the Jockey Club. This is a top-quality project in the same standard of the Golden Green that is considered the best closed condominium in the country with 12 buildings and two clubs. This condo is a code of 18, 19 buildings, and we understand we are going to do this over a 10-year time. The project has already been approved, and the South is extremely strict in terms of the environment and architecture, et cetera. It took us 10 years to have this project approved, and they were finally approved last month, but it is already very well-developed. In a short time, I believe that in June, we will be making our first launch, already having the urbanization of the whole area.
This project represents BRL 3 billion in PSV and will give the company a reasonable profit of, we believe, around BRL 1 billion. When you do everything at present value, of course, it is less. But on the other hand, this is not on the radar screen of the company today because we live based on income. So the financial results that we will be obtaining in the next two years are results that we will be adding to the results of the shopping centers, including the new expansions. I believe that this project is unprecedented in Brazil. It is right next to the Guaíba. It's on the banks of the Guaíba Bank and integrated two nautical clubs, and we expect to present this to the real estate market as a new concept for a real estate project. But the company is very well-capitalized and very confident.
We have enough funds to continue these projects in a very careful manner. In relation to the debt, you know that we are very cautious in terms of debt. Considering the fact that the world has totally changed and that the interest rates are almost negative interest rates, we understand that we can increase our debt now, should this be necessary, without having to increase our capital. We are going to hold back the company in this sense, less capitalization and more debt. I am an entrepreneur. I have been in the market for 57 years already, and I'm not that old because in spite of my age, I'm not old, okay? Because chronological age is one thing, and becoming old is an option, and this is not my option, so I'm not getting old.
Well, I have never imagined in this half a century of business life, I have never imagined that we would have less than 12% nominal interest rate a year, and we are around 4%. This is really surreal as far as I'm concerned, and I have been through so many crises, and I think this is very encouraging. It is very encouraging to see that we have now an administration in place that thinks in a very straightforward manner, and thinks about the development of the country and the reduction in the size of the government or the cost of the government, because we have an inefficient and huge government. We are talking about reducing taxes because it is no use carrying out a tax reform if the government or the administration continues to be that heavy.
I'm very encouraged about that, and I'm happy to say that, for instance, in 1963, when I started, my first project was in 1963, so it was the pre-revolution period. I had to face the 10 or 12 crises, and we have survived all of them. Now we find a much, much better situation, clear skies.
Please, I would like to add one point. We are at 2.4 and you take the EBITDA, and let's say it does not grow, then we would be talking about BRL 1.5 billion increase in leverage. When we think about development, we have the base of the project and when it will be launched, so it's very easy for us to have a cash flow. The only factor is the opportunity. You don't know when it is going to arise, so you have to react very quickly to an opportunity.
For that, we have a very good space, so to say. The real estate fund industry grew a lot. We have many partners and other shopping center companies as well. We can do a lot and tap into these opportunities. Our biggest partner is the shareholder. This is something I would like to highlight. We have many people wanting to be together hand-in-hand with the company in this project. As much as possible, we try to keep within our own possibilities, and we have an excellent technical structure. So we preserve this technical structure in spite of the moment of crisis, and now we are going to reap the fruits from these investments that we have made. Thank you, Luis.
Thank you very much.
Alex Ferraz from Itaú BBA.
Good morning.
Good morning, Mr. Peres, Armando. Thank you for the presentation. I have two questions. The first is related to something that Armando said during the presentation. Every fourth quarter, you show the gross leasable area per segment. Year-on-year, 2019 against, what we saw was a structural change in the services sector gaining relevance. In 12 months, we see that it was reasonably stable. What major change do you foresee in this sense? It seems to me that there is a good adjustment nowadays. Do you foresee a very big change, or do you believe that this whole wave of services has already been adjusted to your portfolio? The CapEx of the Greenfield, you highlighted Jacarepaguá and also to the Global Parque. Do you have a CapEx for Parque Global already, or are you reviewing the project and the specs before you launch the project?
Alex, good morning, and thank you for the questions. These changes in segment are not something that happens overnight or all at the same time, and they do not disappear totally the following year. This is something that undergoes a transformation, and the best way is to show you in the managerial report on page 10. When you take the 10 years, you see a more expressive change. Another example of that is the turnover, and this will be helping you together with the change in segmentation. Last year, we had a turnover. I expected it to be lower than 2018 because of the economy, because of the crisis. It was 5.2% of the gross leasable area, 42,000 sqm almost. With a large shopping center, 333 tenants, more than Jacarepaguá. We are bringing better operations, new operations, even in the same segments.
We are bringing new ideas, new concepts, new ways to establish a relationship with the consumers, and this drives the change in segments over time. In relation to the Parque Global, we have CapEx, we have investments, and the project is being rediscussed and will be submitted to approval, and we will be waiting for the approval of the project in order to be able to continue. There is always some kind of expense and also investments. They have been small so far because of the stage in terms of approval and the changing mix you can see in the new project. It is a totally different concept. You see many more different services of restaurants or green areas when compared to the already existing project. Jacarepaguá, the amount of entertainment and restaurants, et cetera, in Jacarepaguá, and amusement and services, this is totally different.
This changes the concept of a shopping center, the integration with the green, leisure, and commerce. We have always based ourselves on. We are along these lines. It's a little bit art, a little bit fun, a little bit entertainment. Of course, in the project, we include retail, shopping, et cetera. You must take into account the fact that people today are looking for more immediate sensations and experiences. When the shopping center becomes more attractive, in order to achieve this, you have to give more pleasure to people. This is a major objective, to bring pleasure to people, because nobody lives without pleasure. Brazil, specifically, is a country in which our streets, where in the past, you were able to have a stroll, and nowadays people go for a stroll in shopping centers even because of security reasons.
We do not want security to be a negative factor. In Rio de Janeiro, we see more positive signs in terms of security and crime rates going down and more efforts in terms of fight against crime. We want to gain with the quality of our product and not because of that. We will be launching in Curitiba. It is 16,000 meters of expansion. We are going to throw a party. We have stores and restaurants and 3,000 in a medical center that is being very highly demanded, and an additional 2,000 sqm . We are seeking to diversify with new options. A parenthesis here, we were the pioneers in terms of placing large medical centers all over the world. When we did that 27 years ago in BarraShopping.
We had that in Ribeirão Preto as well, and now we are doing the same in Curitiba and with a very different experience. The highest demand that we have is for professionals in the health area. Because when we place a medical center in a shopping mall, we create a way of having medical care together with pleasure because people go to the shopping mall for pleasure, and people think it is better. It is less painful to go to a medical center in a shopping center because there is pleasure around it.
When you go to hospital, there is no pleasure around it. We try to reduce the resistance on the part of people. Those who go to shopping centers every day are usually people that have to go to a doctor's office very often. Globally, in the most recent congress of the ICSC, a lot was said about shopping malls having to have medical centers, mainly because of the aging of the population. We have been doing this for a long time, so we are pioneers, and Curitiba is a big surprise because this is a very good sign. We have a large area for that. Have I answered your question?
Thank you very much. Yes.
Okay. The next question comes from Nicole with Bank of America. Nicole, good morning.
Good morning. Thank you for the call, and congratulations on the results. I have two questions. Firstly, do you think you can tell us more about your initiatives to lower condominium costs? I notice it is going down over the years. I would like to know if there is further room to go down. Also, what are the projects that you are considering down the road in order to further reduce these costs? Second question is about parking lots. I was surprised that the revenues of parking lots are growing. Car flow is surprisingly going up. Could you give us more color on this, please? What about this increase in flow? Is it only in some shopping centers or comparing, for example, those that are at the center of a city, downtown, or in smaller shopping malls? What is behind this parking lot revenue increase or flow? Thank you.
Nicole, thank you for your questions. First, answering about condominium costs. There is a number of initiatives and decisions that are made in order to lower condominium costs over time. They involve the use of systems that eventually lower personnel expenses, and also unification of processes. Also some events like the photovoltaic plant that Dr. Peres mentioned before, which also lower condominium costs, and renegotiation of several agreements. We have a single goal in mind in order not to impair the quality of the condominium. At no time do we challenge our teams or ourselves to lower condominium costs if we have to impair our quality. So what about opportunities? Considering there is a number of processes that can be further improved, no doubt we're going to have an impact on cost. You also have to think about expansions and the natural dilution of condominium costs over time.
As to your question about parking lots, we had a growth in our car flow. I don't remember top of mind for the year, but this quarter the increase was 1.5%. That's for cars only, which is very significant. This has an impact directly in the parking lot with higher flow. But what we also notice about the question about the change in the mix is that the time of stay of consumers in the mall is also increased, and it also brings a stronger impact on parking lot revenues.
Thank you very much.
The next question is from André Mazini with Citibank. André, good morning.
Good morning, Dr. Peres, Armando, the whole team. Thank you for taking my question. I have two questions. First question about Santa Úrsula, with a stake acquisition up to 100%. The low price per square meter was low, around BRL 3, and the cap was also good, double digit. On the other hand, Santa Úrsula is a shopping center that is lagging behind. So now that you hold 100% of the mall, I know you already managed it before.
So can you do anything different? If we check the release, you also mention Ribeirão, and the city is very well supplied for GLA in Multiplan. So can you change the mix? Shopping Santa Úrsula is right in downtown. So what about the last mile or having more services compared to the portfolio average, considering Ribeirão is so big? So people might also go to Ribeirão Mall. So what can you do now that you hold 100%? The second question is about a one-off event that lowered revenue slightly in the fourth quarter for rent revenues. Do you expect to see an increase in the first quarter of 2020? Could you give us more color, please? Thank you.
André, good morning. Santa Úrsula. Just a couple of numbers now. Sales increased 9.1% last year. Increase in rent revenue 17.7% last year, and an increase in car flow of 3.2% last year, which is good. These numbers compared to any other mall is very good. Naturally, Shopping Santa Úrsula is a shopping center that still needs some changes to the mix. It takes some adjustments in a city that increased a large GLA at the same time. Strong malls like ours, including RibeirãoShopping and everything we've done with expansions in recent years, and now with the creation of the medical center. So our partner there sees an opportunity of holding 100% stake of the mall. Naturally, we have the plans of changing the mix over time.
Not only because we acquired, that is not the only driver, but also the right timing. You cannot do everything overnight. We are happy to see the mall growing as it did. With regards to rent, there was an impact. There was an impact on the fourth quarter. At the end of the day, we had an impact on October, slightly less in December, and we expect to see a recovery now in January owing to the change. This is more related to discount accounting. I would just like to say that 100%, the decision-making process is faster, and we managed to change the mix better. It is also motivation to improve the mall. We can expedite the process and expedite improvements in the mall.
Perfect. Great. Thank you. Good morning.
The next question is from Marcelo Motta with JP Morgan. Marcelo, good morning.
Good morning. Two brief questions. First, could you make some comments about sales in January and early February? Just to give us a better understanding if you have the same good pace that you had in 2019 or it is even improving. What about retailers' appetite? We can see a wave of retailers raising capital, considering growth. When you think about the number of malls that are expected to open, sometimes it does not match the expansion size. What about this new format, new stores? Could we consider a positive impact along 2020? Thank you.
Motta, good morning. With regards to sales, we can see growing sales. Dr. Peres has mentioned before, speaking of 10% is totally different compared to the past. We can see sales growing above inflation rates. January, well, February, we cannot just consider that well. It depends on Carnival. The comparison base sometimes is different.
We have to consider the whole quarter. Our vision is very bullish and very positive considering the growth and the rent area as a leverage over time. We never said we expected it would be a great recovery because it never went really down. Our sales were always positive, a new record quarter on quarter since we went public. We still see growth. As for retailers' demand, the question is very good, actually, because that is what we have been saying over time. We need more room. Retail grows in the mall. When you think about the retail sales percentage, if you consider 10 or 20 years back, all you see is growth over time. Once again, a comment that he said previously. He said that people used to walk, and now today they do not walk on the street, they walk in the mall.
They also drive on the streets, even though people say that cars will eventually come to an end and self-driven car will come to stay. It will take 10 or 20 years to see this coming to Brazil. People still drive to the mall, and urban transportation, public transportation is very bad quality, so people are forced to drive to get somewhere. If to come to a safe harbor, you need to be in the mall. You are not going to park your car on the street. I come from the tram time. The tram, wherever it was, progress would come along. Sales were close to the tramway.
Now with cars, we change completely how we see trade and shops. I have been in the shopping mall business for nearly half a century. I am one of the pioneering players. We noticed from the very beginning with the first commercial centers that now consumers are cars, no longer pedestrians. I am not saying we do not have a big flow of people who come with public transportation or apps like Uber or cars, et cetera. In a couple of cities, we already have a city surrounding our mall, particularly the older malls. They created big cities in the surrounding areas, so people can even walk to the mall.
But naturally, we can still see in Brazil, when one retailer comes to Brazil, he pursues the main shopping mall chains to be there. He is not going to go out on the street, because whatever he finds is inadequate. Wherever there is rational, adequate, and convenient space, it has to be in the mall. The mall is an alternative. I would like you to understand that shopping centers are the retail industry.
If you think about Copacabana Avenue, for instance, which took a century to exist. Sometimes you build a mall and there are so many stores as you find along the whole Copacabana Avenue. With a mall, you create a new avenue. A new avenue that gives you AC, comfort, leisure, entertainment, security, and a number of other factors. And condominium costs in Brazil are really high because you feel unsafe outside. When you have safer cities, this cost will go down on the mall. I would just like to share this information because I see our industry as an essential industry to the population, to our society, and to the development of cities. Cities no longer have so many urban solutions, and if it were not for the malls, if there were a strike one day, it would be chaos in the city. Where would people go?
Where will cars park? But when we see that despite competition, e-commerce, apps, our flow continues to go up. I see that as a very positive sign, far more positive than 10 years ago, when flow increase was higher. But today, we suffer from e-commerce competition. Every store has its websites, its apps. What is happening is that the shopping center is not only a big product showcase, but also a center where merchants perform most of their transactions. Now, I would like to highlight the importance of having big commerce avenues in the mall. There is a saying, the shopping center is a copy of the major avenue of trade, and not only that. That is why we are investing in new areas. Canoas, for instance, back in 2017. It was not that obvious to expand at that time, but we did. W e are doing the same expanding in Jacarepaguá.
Many people ask, "Why are you investing if the country is doing so poorly?" Precisely because we noticed the demand of room by tenants. Some things are not so visible. We also invested very heavily in areas that are close to our malls, and now obviously, with a drop in interest rates, the real estate market will grow a lot because the source of income in Brazil, well, we no longer have the jurists. Or not jurists, but that is a pun in Portuguese. People who pay interest rates. If you think about people who are consumers, who are going to buy with lower funding and loans. But I would like to say that the real estate market is the big bet. That is my personal viewpoint. It is the big bet for the coming years.
Because naturally, buying a flat, paying at 10 or 15 years at an interest rate of 5% or 6%, it will be permanently more affordable. The payment installment will be very similar to the rent paid for the flat. I believe there are still many areas. 1 million sqm surrounding our shopping center. This 1 million sqm will bring dividends to the company, since the company has a real estate arm that is still very sustainable and strong.
Perfect. Thank you very much.
Thank you, Marcelo.
The next question is from Pedro Rudge now with Bradesco BBI. Pedro, good morning. Pedro, can you hear me? Hello? Pedro, can you hear us?
Yes, I can hear you.
Please go ahead.
Good morning, everyone. Thank you for the call. Congratulations. I have two brief questions. First question about ParkJacarepaguá. Last quarter, you mentioned the sales were good, even exceeding 50%. I would like to learn more about sales in the fourth quarter, if they continue with the same good pace and the expectations until construction is completed. The second question is about ALL. Now that you closed the year, we notice that provision balance increased compared to 2018. I would like to know if you could give us more color or the reasons why there was an increase in the balance, considering delinquency levels are healthy and flat.
Pedro, your connection was very poor. I hope I got your question. Firstly, Jacarepaguá continues to follow with the rents. Today, we have 70% GLA already negotiated. There will be a gradual increase over the year. We have no hurry to rent. We want to rent well and with the best mix possible. As for ALL, there was a slight increase, a reclassification in the accounts that generated this. Right now, owing to BH Shopping, we have an increase in the mall ALL. We posted a small growth, but two one-off events. Reclassification and BH Shopping.
Clear. Thank you.
The next question is from Jorel with Morgan Stanley. Jorel, good morning.
Good morning, everyone. Thank you for your time. I have two questions. The first question is, revenue growth that we consider in the best malls like Morumbi, BarraShopping, it was a lot better compared to the performance of other mid-tier malls like Jundiaí. Could you give us more color about the difference in performance? Do you believe it has come to stay? The second question is more about M&A in general. We can see a trend of consolidation in mall companies globally, in the U.S., in Europe, and the last offer was. I would like to know what you think about this global trend and if you believe this trend may come to the Brazilian mall market.
Thank you. Jorel. José Isaac Peres now. BarraShopping, Morumbi, naturally, these malls increased their sales positioning, and that is because we had adequate marketing efforts and also a renewal in the mix. Naturally, it brought attractiveness to the mall and also some renovations in-house which provide more comfort to consumers. The summation of these drivers brought to these malls that are very strong malls, improvement in sales. On the other hand, you also had a question about M&A, right? I think it will happen in Brazil. It will happen sometime. I do not think it will not happen, because that is the trend.
Companies want to be more productive. Shareholders want to have more results. Whenever you have two companies together and the summation is greater than two, naturally, there's always a reason for you to have a merger, a partnership, an M&A. I think it will eventually happen. For now, here we are sailing on our own and we know we are always very well. People come to us very often and we have conversations with some partners, and it might, it could happen. I cannot tell you anything because we don't have anything concrete.
Thank you.
This concludes the question-and-answer session. We would like to clarify that any questions that remain unanswered will be answered by the IR area later on. Now we'd like to come back to the last part of the meeting, turning the floor back to Mr. José Isaac Peres for the final remarks. Over to you, sir.
Once again, I would like to thank you all who are listening to us, investors, analysts, shareholders, journalists who follow up our reports. The company is really delighted to meet you all whenever we share the earnings and address some of the news that we are working on. The company celebrates 45 years of existence now, and we hope that the next decade is as prosperous as the last 10 years when the company tripled its size. That's what I have to say to you. It's not easy to triple the size of the company that is slightly bigger, but everything is possible. Thank you. This concludes the fourth quarter 2019 Multiplan's earnings conference call. We thank you all for being with us. Have a good day.