The real estate investment fund that is under scrutiny by the courts of accounts.

Since January 20th, the city hall of São Roque, a city in São Paulo state located in the Sorocaba metropolitan region, has been trying to divest its R$ 20 million investment in the Nest Eagle Real Estate Investment Fund, but is facing difficulties in recovering the invested resources.

The investments were made by São Roque Prev, the municipality's own social security system (RPPS), in the fund's first share issuance in November 2024. However, since last year, the city has been questioned by the Court of Auditors of the State of São Paulo (TCE-SP) about the investment.

Managed by Nest Asset Management and administered by Daycoval, the REIT is intended for the acquisition of luxury and ultra-luxury properties. Even before the completion of its initial offering, Nest Eagle and its shareholders approved the acquisition of properties involving potential conflicts of interest with individuals linked to the management company.

Minutes from the RPPS investment committee meeting of January 20th of this year reveal discussions between representatives of São Roque and Safra bank, which holds the fund's custody, to facilitate the redemption. Given the lack of liquidity, a test sale of 2,000 units (approximately 1% of the total held) at R$ 93 – 7% below the entry price – was agreed upon.

Recent data from São Roque Prev indicates that Nest Eagle is the only REIT in the portfolio, representing 3.6% of the savings of municipal employees.

In its statement to the RPPS (São Paulo State Public Pension System), the Public Prosecutor's Office of the State of São Paulo (MPE-SP) questions the concentration in the fund, the low liquidity, the lack of a tracking record , and the fact that only pension schemes invested in the initial offering of Nest Eagle.

"Because it is a closed-end fund, with no redemption options, the only way for an investor to exit the investment is by selling their shares on the secondary market at B3," Nest informs NeoFeed in a statement.

"Regarding the concentration of RPPS (Regime Próprio de Previdência Social - Public Sector Pension Scheme) investors in closed-end funds, such as the Nest Eagle FII, the manager monitors the liability profile to ensure that the investment policy is compatible with the investors' time horizon, in accordance with regulations," the text adds ( the full text is at the end of the report ).

The Public Prosecutor's Office also raises suspicions about the fact that the investment in Nest Eagle was discussed by the São Roque committee in September 2024, two months before the fund's prospectus was released in November of that same year.

In addition to São Roque, the Public Prosecutor's Office of São Paulo (MPE-SP) notified the RPPS (Regime Próprio de Previdência Social - Public Pension System) of Cajamar, which also participated in the initial offering of Nest Eagle, with a contribution of R$ 25 million.

At least seven other pension funds invested in the REIT, according to the São Paulo State Public Prosecutor's Office. The largest investment was from RioPrevidência , which put R$ 75 million into Nest's fund, followed by the City of Maceió, with R$ 50 million.

Five other municipal pension funds in Mato Grosso do Sul contributed between R$1.5 million and R$2 million to the fund: Fátima do Sul, Angélica, Bodoquena, Aquidauana, and Tacuru. Of these, Angélica and Fátima do Sul also purchased Master's financial instruments in recent years.

By February 2025, Nest Eagle had raised R$ 198.8 million from its own social security systems (RPPS), according to documents from the São Paulo State Public Prosecutor's Office (MPE-SP).

Conflicts in luxury

With the money raised, Nest Eagle intended to acquire properties linked to people connected to the fund itself. The purchase, which involved conflicts of interest, was even put to a vote at an extraordinary general meeting (EGM) in February of last year, about a month before the fund's first offering was completed – and it was approved.

The list of properties with conflicts of interest includes up to twenty houses from the Jardin D'L'Helvetia project, located in the city of Indaiatuba, São Paulo state, and future units of the São Paulo Surf Club Residences project, in the city of São Paulo, without specifying the quantity.

According to the document, the São Paulo Surf Club units presented conflicts of interest involving individuals connected to the seller and the specialized consultant hired by the fund, while the Indaiatuba properties also involved conflicts with the manager and one of the partners of the Nest Eagle manager.

In the document, the asset manager is represented by Nest International Administradora de Carteira de Valores Mobiliários, a holding company whose shareholders are the founding partners of Nest Asset, Felipe Prata and Luis Castro da Fonseca, as well as 11 other partners and two holding companies.

The seller and the fund's specialized consultant, who allegedly had conflicting interests, were not detailed in the documents.

At the same meeting, authorization was also approved for the fund to incur expenses related to the acquisition of properties in the Nampur Azul and Residencial Nampur Ávora condominiums, both located in Porto Seguro.

Nest clarifies in the statement that "in compliance with regulations, and to provide transparency to investors, the acquisition of assets with a potential conflict of interest with parties contracted by the Fund was submitted to the unit holders for deliberation at an Extraordinary General Meeting. Had the unit holders not approved, these assets would not have been acquired. The Fund's portfolio was built to have a capacity of R$ 500 million. As the fundraising result fell short of expectations, we focused on acquiring assets that would bring better potential returns to the unit holder."

Modus Operandi

Of the nine RPPS (Brazilian public pension funds) that invested in Nest Eagle, six allocated resources to Master's financial instruments . Besides RioPrevidência, which was the target of a Federal Police operation, São Roque, Cajamar, and Maceió were also among the RPPS that purchased the most securities from the bank.

There is also a temporal coincidence between the investments made in Master and Nest. At São Roque Prev, for example, the decision to invest in both products was made at the same meeting by the Investment Committee.

In Maceió, the investment in Nest Eagle was presented at the meeting following the one that discussed investments in Master's financial instruments and prior to the one that dealt with investments in funds linked to the conglomerate.

Minutes from investment committees obtained by NeoFeed reveal that the fund was formally presented to the RPPS (Regimes Próprios de Previdência Social - Public Pension Systems) through contracted consulting firms.

The report identified at least three specialized companies that actively participated in offering the fund: Crédito & Mercado, Amplie Invest, and Vibra Investimentos, also known as Vamos Investir Brasil.

In some cases, the fund presentation was made directly by Nest Asset partners, as in the investment made by the São Roque pension fund.

But not everyone bought into the fund's idea, judging the risks to be too high relative to the expected return. The list includes the pension plans of Bom Despacho (MG), Venâncio Aires (RS), and the São Paulo cities of Itanhaém, Registro, and Araras.

According to the documents, Nest Eagle was offered to the public pension systems primarily through consultancies hired by the RPPS themselves.

Email exchanges obtained by NeoFeed between the Araras RPPS (Regime Próprio de Previdência Social - Public Pension System) and the consulting firm Crédito & Mercado show that the fund was offered with an expected return of IPCA+5.50% and an indication of potential for additional appreciation, with an estimated internal rate of return (IRR) between 20% and 30%. There was no mention of potential conflicts of interest.

In the emails, the consultant from Crédito & Mercado also admits the absence of valuation reports on the fund's potential acquisitions, even with the offer already underway, in addition to the lack of an operational track record for the transactions. The proposed management fee was 2.18%, plus a performance fee of 20% on anything exceeding the IPCA+5.5% benchmark, without the option of early redemptions.

Given the conditions, the Araras investment committee unanimously decided to reject the investment, concluding that "the return presented is low and very close to our actuarial target, and presents a high risk."

The refusal of some RPPS (Regimes Próprios de Previdência Social - Public Pension Systems), however, did not prevent the fund from completing its first offering, albeit in a smaller amount than expected. Of the projected R$ 500 million, the Nest Eagle Real Estate Investment Fund raised R$ 157.8 million.

In April, less than a month after closing its first offering, the fund launched a new offering – this time expecting to raise R$ 360 million – but managed to raise only R$ 28.9 million. There were five investors and, as in the first offering, all were classified as "other legal entities," the same category used to designate RPPS (Brazilian public pension funds).

Already under the spotlight of the audit courts, the Nest Eagle Real Estate Investment Fund held another extraordinary general meeting in November of last year to deliberate once again on the purchase of properties involving conflicts of interest. This time, the majority of shareholders decided not to ratify the acquisition of the properties whose purchase had been approved in February 2025.

At the last meeting, a change in the fund's administrator was also proposed, with a migration to Inter DTVM.

The text submitted to the investors stipulated the ratification of all administrative and management acts of the fund carried out up to that point by the administrator and the manager, as well as by third parties contracted by them, "including granting them full, total and unrestricted release, so that they could not claim anything more, at any time or for any reason whatsoever." However, the migration was rejected by the majority of investors.

Although investors reversed their decision in November 2025 regarding investments with conflicts of interest, Nest Eagle's periodic reports reveal that since December 2024 the fund has maintained virtually all of its investment in income-generating properties.

There were three acquisitions in 2024: two properties in Fazenda Boa Vista for R$ 35.55 million and R$ 19.19 million, and three properties in the Saint Barthélemy Condominium, in Vila Nova Conceição, São Paulo, for R$ 36.9 million. The ownership stakes in these properties are listed up to the quarterly report of June 2025, but are absent from the report for the quarter ending in September.

The monthly report for December, the last one released by the fund, shows R$ 182.77 million invested in completed income-generating properties and only R$ 585,000 in liquid assets. Nothing has been distributed to investors so far.

Maceió backs FII and denies relationship with Master.

The news outlet contacted Nest Asset and the mentioned RPPS (Regimes Próprios de Previdência Social - Own Social Security Regimes), but only the Maceió pension scheme responded to the questions.

According to Maceió Previdência, the investment was selected "as the most suitable option to fill the real estate exposure gap" and decided upon after "in-depth technical analyses by a duly accredited external investment consultancy," namely Crédito & Mercado.

“There was a formal written recommendation in favor of the investment, substantiated by technical reports dated October 2024, which analyzed credit, market and liquidity risks, as well as compliance with applicable legislation.” The decision to invest, however, came from the Investment Committee and the Executive Board of Maceió Previdência.

Maceió Previdência also mentions that they were presented with the properties that made up the acquisition pipeline along with technical audit reports (information that contradicts the exchange of emails between representatives of the consulting firm and the Araras RPPS).

Maceió Previdência also stated that the fund projected a return of IPCA+5.50% per year. This return is significantly lower than that of the NTN-B maturing in 2045, currently at IPCA+7.23%. In shorter terms, the return is close to IPCA+8%.

The RPPS also stated that it has been questioned by the TCE and MPE of Alagoas regarding investments in Nest Eagle, but that it "has already presented a detailed technical defense, demonstrating the integrity of all actions taken."

It was also denied that there was “any operational or decisional link” between the allocation in the Nest Eagle REIT and the acquisition of Master's financial letters, “except for the fact that both occurred within a legitimate diversification strategy.”

Below is the full text of the statement sent by the management company Nest:

The Nest Eagle FII was structured for the general public. Due to aligned commercial strategy among the participants in the public offering, greater emphasis was placed on institutional investors (RPPS). The public offering was approved and registered with Anbima/CVM and B3, respecting all governance and transparency required by regulations. The Fund's units are listed on B3.

All participants in the public offering of the Fund's units were widely disclosed, as well as their duties and remuneration. Securities consulting firms or investment advisors are not part of the group. The latter are hired and remunerated by the distributing institution. Securities consultants, on the other hand, are hired and remunerated by the investors who contract them.

The fund aims to increase the investor's share price through a combined strategy of appreciation and profitability, by acquiring and leasing luxury and super-luxury residential properties. Various market research studies and data have shown consistent appreciation and resilience in this market over the last few decades, with performances exceeding double digits annually.

Because it is a closed-end fund with no redemption options, the only way for an investor to exit the investment is by selling their shares on the secondary market at B3.

Regarding the concentration of RPPS (Regime Próprio de Previdência Social - Public Sector Pension Scheme) investors in closed-end funds, such as the Nest Eagle FII, the manager monitors the liability profile to ensure that the investment policy is compatible with the investors' time horizon, in accordance with regulations. We are talking about a long-term real estate investment fund, where, following the investment policy and the investments already made, we expect to deliver positive returns to the investor.

Negative returns in the first few years are expected due to the impact of costs involved in the public offering, as well as acquisition costs for assets that are not yet performing, disbursements necessary to prepare the properties for lease, and maintenance costs of the Fund itself. Appreciation results may be seen in the unit prices in annual valuations of the portfolio's assets, as well as in any asset transactions – sale or exchange – and income from leases.

It's worth noting that, like all assets in investment funds, the assets may experience small variations when traded, but we are looking at a longer horizon. In short, profitability and performance initially stem from disbursements, representing the "J" curve, so common in this type of investment, and will smooth out as the fund matures, as is common in the market.

In accordance with regulations, and to provide transparency to investors, the acquisition of assets with a potential conflict of interest with parties contracted by the Fund was submitted to the unit holders for deliberation at an Extraordinary General Meeting. Had the unit holders not approved, these assets would not have been acquired. The Fund's portfolio was built to have a capacity of R$ 500 million. As the fundraising result fell short of expectations, we focused on acquiring assets that would bring better potential returns to the unit holder.

In parallel, we are evaluating other strategies to increase the portfolio's asset diversification, as well as to increase its net worth, in order to dilute the liability in RPPS (Brazilian pension funds), for this we are talking with other managers and other real estate investment funds with strategies and objectives similar to Nest Eagle FII. All information about the assets comprising the Fund's portfolio is made available to shareholders monthly.

Regarding the outcome of the November Extraordinary General Meeting, this decision is final and we respect the shareholders' wishes. We understand that the agenda items were intertwined and interdependent, making it difficult to vote on isolated matters, given that the main topic was the proposed change in administration, custody, and registrar.

Regarding the observations made by regulatory bodies, it should be noted that the manager has not received any request for clarification. As for the investors, this is a routine activity of the supervisory bodies, and as long as we are prompted by the shareholders, we will pass on all the information that is within our purview.

Nest is the manager of Nest Eagle FII (EAGL11), duly authorized by the CVM (Brazilian Securities and Exchange Commission) to manage securities, specifically in the Fund Management category. The Fund is managed by Banco Daycoval SA, a financial institution authorized by the CVM to manage securities, specifically in the fiduciary administration category. Prior to acquisition, the assets undergo legal due diligence, market valuation, and technical inspection, all conducted by independent specialized firms, in accordance with best market practices. The fund is audited annually by an independent specialized company, as stipulated in its bylaws and regulations.

Finally, we would like to highlight that Nest Asset Management, founded in 2017, is an asset manager focused on equities, fixed income, and alternative investments. It has a team of 18 professionals with a solid track record in independent asset management firms, investment banks, and financial consultancies, bringing together more than 90 years of accumulated experience in the capital markets.