CSFB 3rd Brazil Construction & Mortgage Field Trip

1

CSFB 3rd Brazil Construction & Mortgage Field Trip

Second Quarter 2006 Launches

Belle Vue – Porto Alegre Paço das Águas – São Paulo Vistta Ibirapuera – São Paulo Beach Park Living - Fortaleza

Blue Land – Rio de Janeiro

São Paulo, Brazil, August 30nd, 2006

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We make forward-looking statements that are subject to risks and uncertainties. These statements are based on the beliefs and assumptions of our management, and on information currently available to us. Forward-looking statements include statements regarding our intent, belief or current expectations or that of our directors or executive officers.

Forward-looking statements also include information concerning our possible or assumed future results of operations, as well as statements preceded by, followed by, or that include the words ''believes,'' ''may,'' ''will,'' ''continues,'' ''expects,'‘''anticipates,'' ''intends,'' ''plans,'' ''estimates'' or similar expressions. Forward-looking statements are not guarantees of performance. They involve risks, uncertainties and assumptions because they relate to future events and therefore depend on circumstances that may or may not occur. Our future results and shareholder values may differ materially from those expressed in or suggested by these forward-looking statements. Many of the factors that will determine these results and values are beyond our ability to control or predict.

“Safe-Harbor” Statement

3

Agenda

Company Overview 3

Culture and Business Model 8

Page

Opportunities Ahead 15

Operating and Financial Performance 23

Appendix 31

Overview of Operations 12

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Overview da Companhia

We are one of Brazil´s leading homebuilding companies, focusing on residential markets.

Over the last 50 years, we have been recognized as one of the foremost professionally-managed homebuilders

In December 1997, GP and CIMOB entered into a partnership whereby a new company was formed under the name of Gafisa S.A., following the transfer of its land reserves, brand and personnel.

In 2004, entities related to GP acquired a significant equity interest in our company and in the following year acquired the remaining stake held by CIMOB.

In 2005, an affiliate of Equity International Properties, acquired approximately 32% of our company.

Gafisa raised R$ 494.4 million in an initial public offering to invest in new residential projects.

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Well Defined Strategy

Create the leading residential development company in Brazil based upon sales, profitability and quality

Strong revenue growth

Focus on high return

opportunities

Maintain debt policy of

40% - 60% net debt / equity

Continued geographic expansion

Our Strategy

Maintain land bank of

2-3 years of future sales

6

Gafisa: Premier Growth Opportunity

Professional Managementand

Established Organization

Industry Leadership and Strong Brand Recognition

GeographicDiversification

World-class Shareholdersand the Highest Standards of Corporate Governance

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Led by GP and EI, Gafisa is the only homebuilder with an institutional shareholder base …

World-Class Shareholders and Corporate Governance

… and commitment to superior corporate governance standards

27.4%21.8%

Free Float

50.8%

Post-IPO Shareholder Structure 1

► Proven track record in the Brazilian capital markets

– Submarino, ALL, Cemar, among others

► A leading investor in real estate companies outside of the U.S.

► Portfolio includes Homex, Mexico’s leading homebuilder

► Founded by Sam Zell

► Novo Mercado listing

► 100% tag along rights

► US GAAP

► 2 independent board

members

► Audit Committee

Superior Governance Standards

Note:1 Excludes treasury stocks

8

Agenda

Company Overview 3


Page



Appendix 31


9

A superior organizational structure and professional management yield results …

Professional Management and Superior Organizational Structure

… and make Gafisa a scalable business platform

A unique business model in the industry oriented towards maximizing shareholder profitability

Gafisa People and its culture

Professional, experienced and motivated management focused on value creation

Committed to develop leaders

4 out of 7 directors joined the

company as interns

Results driven culture

40% to 60% of compensation

linked to aggressive targets

In depth industry knowledge

Management, on average, with more

than 14 years of experience

Ownership Culture

More than 25 managers hold

3.6% of the company

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Efficient and Scalable Organizational Structure Designed to Sustain Growth

SeniorManagement

Regional Regional

Operations(Construction)

Sales Performance

Geography

Tasks

Operation Operation Operation Operation Operation Operation… …

…

…

IT

Finance

…

…

Human Resources …

Better execution, goals, standardization, best

practices

Goals definitions, Performance management,

best practices, standardization, economies

of scale

Back-office …

Gafisa’s Business Owner Structure is Unique on the Sector

11

An efficient business model, based on three main pillars…

Efficient Business Model

… oriented towards maximizing shareholder profitability (ROE)

ROE

High Asset Turn OverHigh sales velocity: 70% of units

sold before constructionSecuritize client receivables to

optimize working capital

Low CostOperations

Builds for some of Gafisa´s main competitorsStandardized construction techniquesInnovative materials and techniques

Land AcquisitionProven ability to source landAcquire land mostly via swap

Minimize cash outflowAlignment with landowner

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Agenda

Company Overview 3


Page



Appendix 31


13

A Diverse Product Mix Positions Gafisa to Take Advantage of Positive Environment

100 to 400100 to 500150 to 300up to 100# of Units

28%

2%

R$ 1,800 to R$ 2,000

100% CEF (directly to buyer)

R$ 32,000 to R$ 62,000

R$ 70k to 130K

45 to 65 sq.m

Affordable Entry Level Land SubdivisionMiddle and Mid-HighHigh-End

31%

62%

R$ 2,000 to R$ 3,600

Commercial Banks and CEF

R$ 70,000 to R$150,000

R$ 150k to 400K

70 to 150 sq.m

10%19%% of 2006 Launches²

44%

R$ 150 – R$ 800

Provided by Gafisa

Diverse

Up to 300k

100 to 1,000 sq.m

37%

Above R$3,600

Provided by Gafisa

Above R$150,000

Above 400K

100 to 500 sq.m

Typical Project Margin

Average Price sq.m

Financing

Household Income¹

Price Range

Size

Notes:¹ Annual household income. ² Gafisa has commercial buildings which accounted for the remaining 7% of the 2006 Launches

Lorian - SPBlue -RJ Side Park - SPThe Gold-SP

Gafisa’s product diversification is a key differentiating strategy…

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► Why expand through JVs with local partners?Develop local partnerships to leverage regional market knowledge, legal skills, risk mitigation and entry barriers

► Growth Opportunities Multiple drivers of other markets mitigate growth riskSmall and poorly capitalized competitorsBetter marginsBusiness Owners Organizational Structure provide a totally focused local management integrated and supported by Gafisa Corporate Unit in Sao Paulo

Present in 12 states, Gafisa is one of the most geographically diverse builders in Brazil

Although SP and RJ are still core markets, “New Markets” already represents 32% of Gafisa’s Launches

► How Gafisa is differentiated in Developing Markets?Strength of its brand and its track record in São Paulo and Rio de Janeiro

Innovative project concepts

Differentiated project designs

Delivery of products on time and demand-aligned payment conditions

Aggressive marketing strategy

Geographical expansion offers further growth potential in the medium term

North • Rapidly Expanding Export Platform• Brazil’s New Agricultural Frontier

Mid-west• High Dependant on the Agricultural Business South

• Nation’s Highest Income Per Capita

Northeast• Second Home, Foreign Investments

Gafisa’s core markets (SP / RJ)

Recently signed partnerships

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Agenda

Company Overview 3


Page



Appendix 31


16

Brazil’s housing market presents large and sustainable demand…

Robust Growth Prospects in Brazil and the Favorable Demographics Make It Difficult to Ignore Its Potential

-10 -8 -6 -4 -2 0

5-9

15-19

25-29

35-39

45-49

55-59

65-69

75-79

► Largest economy in South America

► Politically stable and fiscally conservative

► Strong economic fundamentals

– Unemployment rate: declining

– Interest rates: declining

– Country risk at historical lows

Favorable Housing Market TrendsBrazil’s Economic Trends

► Attractive demographics: young and growing

population

► Strong pent-up demand:

– Housing deficit currently grows at a pace of

300,000 units per year

…which is expected to continue significantly exceeding supplySource: Central Bank and Focus (Market Estimates)

0 2 4 6 8 10Source: IBGE

Brazil Demographic Pyramid - 2005

13

15

17

19

21

23

25

27

29

out02

fev03

jun03

out03

fev04

jun04

out04

fev05

jun05

out05

fev06

jun06

out06

fev07

Interest Rates (Selic) - Historical and Forward

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2,2 3,04,8

10,0

2,04,1

4,5

6,0

9,1

10,3

2,9

5,3

2003 2004 2005 2006E 1H05 1H06

Mortgage by Commerc ial Banks¹ CEF Mortgage Loans

► 2006 - Bradesco plans to triple mortgage lending activity this year to nearly R$2 billion.

► Itaú launches 15-yr fixed mortgage rate (18.85%p.a.)

► CEF comes back to middle income market (10.9%p.a.)

► Santander launches 20-yr fixed mortgage rate (16.9%p.a.) HSBC @ 12.68% pa. - 10 years

► Gafisa, HSBC and Santander offer pre-approved mortgages

► Central Bank may allow paycheck discount for mortgage lending

Commercial banks are coming to fuel the housing sector

R$ billion

Sources: ABECIP, Central Bank. ¹ Total mortgage lending using savings deposits funding (channeled-lending requirement).

104%

83%

13%

109%

20,3

13,9

9,0

6,7

4,9

9,4

Timeline - Recent Developments in the Housing Sector► 2005 - Individuals gets Tax

exempted on MBS Investments

► ABN Amro, Santander and HSBC reduce Mortgage Rates to 8%p.y from 12%p.a.

► Itaú, Bradesco, Unibanco follow suit

► Santander launches 10-yr fixed mortgage rate (21%p.a.)

► 2003 - Central Bank increases bank requirement to invest in the sector

► 2004 - Resolution 10.931 Improves Foreclosure regulation

Increasing credit availability and new regulation will support the potential of the sector

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Decreasing Interest Rates and Development of the Mortgage Market…

…will directly impact housing affordability

0%

10%

20%

30%

40%

50%

60%

2004 2005 1Q06 2Q06

9,232

2,308

6

12% p.a.

120,000

80,000

60%

200,000

Current Financing provided by Homebuilders

5,5835,573Required Monthly Household Income (R$)

1,3961,393Monthly Installment (R$)

2315Tenor (years)

8% p.a.12% p.a.Real Interest Rates

180,000120,000Mortgage Financing

20,00080,000Down Payment (R$)

90%60%Loan-to Value – LTV (%)

200,000200,000Unit Price (R$)

Expected Medium Term Scenario

Current SFH Mortgage

0%

10%

20%

30%

40%

50%

2004 2005 1TRI06 2TRI06

Gafisa’s Mortgage Penetration (Sao Paulo) Gafisa’s Mortgage Penetration (Rio de Janeiro)

% Mortgage / Total Pre-sales % Mortgage / Total Pre-sales

~16% of the labor market

~10% of the labor market

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High Fragmentation is also an opportunity

Market Share in São Paulo (2005)

Well capitalized companies will benefitfrom increasing demand

Market Share in Rio de Janeiro (2005)

Source: EMBRAESP and SECOVI

Others80%

5%

Cyrela Brazil Realty8%

Rossi Residencial2%

Company S.A.3%

Tecnisa2%

Source: ADEMI

Others42%

CHL9%

Carmo Calçada11%

Agenco13%

RJZ Cyrela12%

13%

Units (#)

Launchings (R$ bi)

2005 04-05Growth

33,748

9.0 19%

24% Units (#)

Launchings (R$ bi)

2005 04-05Growth

8,832

3.0 2%

23%

Gafisa´s strong brand and market positioning are a competitive advantage against the many family-owned and non-professional competitors

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“Gafisa” has a very strong appeal to the buyers, with a direct link to its Real Estate products

Size and Strong Brand Matters in this Sector

… made Gafisa’s brand one of the best-known in the Brazilian real estate industry

Palazzo Farnese - SP

Strong brand and track record enables it to enter into swap agreements, paying for the land with units of the future development

“Safe hands” appeal to the buyers results higher in pre-sales velocity compared to smaller players

First look at land and partnership deals

Product and geographic diversity

Strong balance sheets

Scale to leverage processes and supply agreements

Expertise to underwrite, control and process land

Attract and retain high talent work force

Greater relative investment in technology

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Land Bank representing 2-3 years of future sales

Potential Units by Income Segment

Strategic Land Bank

São Paulo

Rio deJaneiro

OtherCities

Total

%

Gafisa’s Current¹ Land Bank

846

604

638

2,089

Future Sales(R$ mm)

67%

90%

92%

84%

%acquiredby swapHigh Middle Lots &

Com

336

1,032

444

1,812

23%

2,118

1,080

2,115

5,313

68%

8

418

270

696

9%

AEL

-

-

-

-

0%

São Bernardo do Campo

Rio de Janeiro

¹ As of June 30th

22

Even in cities like Sao Paulo and Rio de Janeiro, Land is far from Scarce

A Land bank representing 2-3 years of future sales is enough to sustain our strong growth rates

Verdes Pracas - SP

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Agenda

Company Overview 3


Page



Appendix 31


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Destaques Operacionais

293 333 325254

450

168

381

2001 2002 2003 2004 2005 1S05 1S06

Lançamentos (R$ milhões) Vendas Contratadas (R$ milhões)

389 388 377

207

652

436

180

2001 2002 2003 2004 2005 1S05 1S06

142%

127%

Mix de Vendas Contratadas – 1S06

Alto – Alta Renda: > R$3,600 Médio- alto – Renda Média Alta: R$2,800 < > R$3,600Médio – Renda Média: R$2,000 < > R$2,800 Baixa Renda – Médio Baixa e Baixa Renda: R$1,800 < > R$2,000 Comercial – Comercial: R$4,000 < > R$7,000 Lotes – Loteamento: R$150< >R$800

Segmentos (Preço Médio por metro quadrado)

19%

23%

2%

10% 7%

39%

AltoMédio-AltoMédioBaixa RendaLotesComercial

62,3%

25

15

4251

2027

9

34

12%12%

4%6%

4%

12%

8%

2001 2002 2003 2004 2005 1H05 1H06¹

Adj. Net Income Net Margin

Operating Highlights

67

114142

124 139

68 75

32%

26%28%

27%

32%34%

34%

2001 2002 2003 2004 2005 1H05 1H06

Gross Profit Gross Margin

26

64

8466 65

36 38

19% 19%

14% 13%

17%

14%13%

2001 2002 2003 2004 2005 1H05 1H06¹

Adj. EBITDA EBITDA Margin

Net Revenues (R$ mm) Gross Profit (R$ mm)

EBITDA (R$ mm) Net Income (R$ mm)

197

334440 436

494

212285

2001 2002 2003 2004 2005 1H05 1H06

34%

9.6%

8%

265%

¹ Adjusted EBITDA ¹ Adjusted Net Income

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2Q06 Pre-sales x Recognized Revenues (R$000)

… as we are recognizing previous years revenues

Launched in 2006

Launched in 2005

Launched in 2004

Launched in 2003

Launched in 2002

Others

Developments Pre-Sales

143,699

48,347

16,557

13,832

6,436

na

% of Pre-Sales

63%

21%

7%

6%

3%

na

16,042

44,542

33,951

36,963

8,240

12,809

Revenues % of Revenues

11%

29%

22%

24%

5%

8%

152,547 100%Total

84%

59%

228,870 100%

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Income Statement doesn’t necessarily reflect the economics of the Sector

Earnings recognition per year

11% 48% 42%

Accumulated earnings recognized (a x b) 11% 59% 100%

Year 1 Year 2 Year 3

Historically, almost 90% of a year’s earnings are based on previous’ years launches

However, earnings “lag” provides strong predictability

Earnings are recognized under the percentage of completion method

Accumulated Sales (a)

Percentage of completion (b)

70% 90% 100%

15% 65% 100%

28

Strong Pre-sales performance will positively impact future earnings

… with margins record high margins of 43.3%

Currently, Gafisa has approximately R$243 million of results to be recognized (a 91% growth compared to 2Q05)…

2Q05(a)

1Q06(b)

Revenues and Results be Recognized (R$ mm) Backlog Margin (%)

Sales to be Recognized

Costs of Units Soldto be Recognized 1

Results to beRecognized

Margin to beRecognized

473,4

(278,9)

194,5

41.1%

383,2

126,9

33.1%

Note:1 Includes only land and construction costs

(256,3)

2Q06 (c)

560,7

(317,8)

242,8

43.3%

(c)/(b)%

18%

14%

25%

(c)/(a)%

46%

24%

91%

43.3%41.1%

33.1%

2Q05 1Q06 2Q06

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Strong Financial Position…

Short Term DebtLong Term Debt Total Debt

Cash and Cash Equivalents Net Debt (Net Cash)Shareholder’s Equity

Total Capitalization

(R$ million) 2Q06

85191276

423(147)806

1,082

1Q06

86199285

481(196)788

1,073

…coupled with focus on working capital management

Net Debt/ Equity -18% -25%

2Q05

38102140

11921321

461

7%

In order to optimize its working capital, Gafisa has been demanding new product from banks:

Gafisa and Banco HSBC offer pre-approved mortgage in Santo Andre (Sao Paulo)

Gafisa and Banco Santander Banespa Launches No-paperwork mortgage in Rio de Janeiro

Gafisa and Banco Santander Banespa offer mortgage with discount on rent during construction period

More recently, Gafisa’s Board approved a R$100 million securitization of Receivables from clients

30

Our Goals for 2006

► Launching growth guidance for 2006 of 25-28% in nominal currency terms

► EBITDA margin for FY06 of 16-17% (as % of Net Revenues)

Continued Growth Pace

Margin Expansion

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Agenda

Company Overview 3


Page



Appendix 31


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► Market research

► Project analysis

► Sales strategy

► Internal approvals

► Permitting

► Market research

► Project analysis

► Sales strategy

► Internal approvals

► Permitting

► Sales: 70% of units

► Secure client financing


► Secure client financing


► Secure construction financing

► Efficient construction


► Secure construction financing

► Efficient construction

► Securitization

► Bank mortgage (customer)

► Securitization

► Bank mortgage (customer)

Development Process

LandPurchase Launch Construction Delivery

- 6th to 0 month 0 to 12th month 12th to 36th month After 36th month

33

The nature of the business requires funding for the first year of development…

LandPurchase Launching Construction Delivery

Notes:1 Construction financing provided with funds from SFH2 Middle-income with swap agreement project

Cumulative Cash Flow to Equity 1, 2

… followed by significant cash in-flows

► Beginning of construction

► Project launching

► Securitization of remaining receivables

► End of construction► Customer gets

commercial mortgage financing

► Construction Finance (SFH) repayment

Expected ROIC = 35%

-6 – 0months

0 – 12months

12 – 36months

36 +months

Maximum exposure: 10% to 12% of

sales contracted

(15)

(5)

5

15

R$

milli

on

Typical Project Cash Flow

Documents

CSFB 3rd Brazil Construction & Mortgage Field Trip