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Harvard Investment in Brazil Tangled in Landholding Dispute

Harvard Management Company is housed in the Boston Federal Reserve Building.
Harvard Management Company is housed in the Boston Federal Reserve Building. By Karina G. Gonzalez-Espinoza
By Henry W. Burnes and Lucas Ward, Crimson Staff Writers

A University investment in Brazilian farmland may be in danger of a lawsuit as prosecutors in the state of Bahia review allegations that a company linked to Harvard’s endowment does not rightfully own titles to the land.

Harvard Management Company—which controls the University’s $37.1 billion endowment—owns its holdings in Western Bahia through its subsidiary Guara LLC. Guara owns Caracol Agropecuaria, the company that holds the property titles, according to University filings.

Caracol is valued at around $44 million, according to Harvard’s 2016 endowment tax filing. The commission listed irregularities with 24 titles for Caracol land holdings, Bloomberg News first reported.

“Caracol has the property title, but it couldn’t prove how the land, at the dimensions it has today, has been formed over time,” Barbara Camardelli Loi, an official in the prosecutor’s office, said in an interview with Bloomberg. “If we prove this is an area owned by the state, the company will lose it.”

The dispute has gone on for years and covers titles for a large majority of the farm. It is the second recent controversy surrounding foreign land holdings for HMC, after its farms and forests assets lost over $1 billion in value. Included in these losses was an investment in a eucalyptus plantation in Uruguay that fared particularly poorly.

Complaints from subsistence farmers in Bahia that they had been evicted from government land predate Caracol’s involvement in the dispute. A 2014 report from a state commission recommended titles be revoked after finding a “festival of irregular and illegal procedures which resulted in usurpation of public lands.”

Brazil began restricting foreign ownership of farms in 2010, prompted by increased international investments.

In the face of steep losses, HMC has begun a program repositioning its foreign land investment.

HMC decided to exit from another Brazilian farm investment of at least $150 million last year, contributing to the write-down of the natural resources portfolio. HMC has had a number of other properties in Brazil.

HMC CEO N.P. Narvekar explained the company’s decision to move away from natural resources in a September letter.

“For years, HMC benefited from an internally managed natural resources program that generated strong returns,” he wrote. “At this stage, however, while most assets remain attractive, a few have significant challenges.”

“Our natural resource platform will take multiple years to reposition,” he added.

In another recent offload, HMC sold $73 million of farmland in New Zealand.

—Staff writer Lucas Ward can be reached at Follow him on twitter at @LucaspfWard.

—Staff writer Henry W. Burnes can be reached at

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