What Happened with CARE11 in the July 2026 Report?
An accounting mirage and a formal registration correction. The Structured Monthly Report for July 2026, filed under ID 1314591 on Oct 9, 2026 by administrator Mérito DTVM, showed a dividend yield for the reference month of 3.0925%—after marking 15.45% in the previous document (ID 1300658 on 08/26/2026). For the unwary unitholder following aggregators without checking, this data might suggest that the CARE11 real estate fund had resumed distributing earnings to the market. It had not.
The reality of the accounting facts is absolute: the CARE11 real estate fund (Brazilian Graveyard and Death Care Services FII) has not distributed a single cent of earnings since September 2021, totaling more than 56 consecutive months with zero payouts to unitholders. The indicated value of 3.0925% stems from distortions in the standardized structured reports that have accompanied the fund since the administration transfer from Trustee to Mérito DTVM.
At the same time, the document brought a structural change to the unit registry: the number of issued units was corrected to 7,201,226.4800 units. In the previous report, the registry showed the inconsistent figure of 36,006,138.40. Net asset value closed July 2026 at R$ 249,012,074.89 (R$ 249.0 million), resulting in a net asset value per unit (NAV) of R$ 34.579120 (R$ 34.58).
Did CARE11 Actually Pay Dividends or Is It a Reporting Error?
No dividends were paid. The fund closed the month with 0.0000% amortizations and a negative asset return of -0.0603%. The official history shows that the last earnings credited by CARE11 occurred for the September 2021 period, when it paid R$ 0.001677 per unit. Since then, it has been nearly five years of strictly zeroed payouts.
This absence of payouts does not stem from mere discretionary retention of resources, but rather from a chronic shortage of positive financial results. In fiscal year 2025, as detailed in the December 2025 Annual Report (item 4.1), the fund's result was negative by R$ 1,422,529.04 (a deficit of R$ 1.42 million). In the first quarter of 2026, financial results remained in the red, posting a deficit of R$ 477,335.98 in the Quarterly Report dated 03/31/2026. Without operating profit earned on a cash basis, the fund operates with a payout ratio of 0.00%.
Indicator Warning: The 3.0925% dividend yield field in the structured report from Oct 9, 2026 is an accounting noise resulting from the formulas in Mérito DTVM's bookkeeping spreadsheet. CARE11 neither generated nor distributed earnings during the period.
| Reference Month | Declared Earnings (R$/unit) | Operational Status |
|---|---|---|
| July 2026 | R$ 0.000000 | 3.0925% DY in report is a bookkeeping error |
| Q1 2026 | R$ 0.000000 | Negative financial result of -R$ 477,335.98 |
| Year 2025 | R$ 0.000000 | Fiscal year result of -R$ 1,422,529.04 |
| September 2021 | R$ 0.001677 | Last earnings distributed before suspension |
| August 2021 | R$ 0.008400 | Regular monthly earnings for the period |
| July 2021 | R$ 0.008400 | Regular monthly earnings for the period |
Why Is the CARE11 Real Estate Fund in Liquidation?
Because unitholders themselves voted for the formal winding down of the fund. In a formal consultation concluded on Mar 8, 2026, the general meeting approved that administrator Mérito DTVM and manager Zion Gestão draft a Liquidation Plan containing estimated timelines and the schedule to monetize assets and return owed resources to investors.
This process replaced the former investment thesis, which depended on a potential initial public offering (IPO) or strategic sale of the stake in Cortel Holding. Now, the fund's existence has a numbered countdown: management and administration must detail the steps to liquidate assets, create a consultative Unitholder Committee composed of 5 members, present quarterly governance reports, and hire an independent audit before submitting the final execution to a new formal consultation of unitholders.
What Does CARE11 Invest In? What Makes Up the R$ 249 Million Portfolio?
CARE11 invests predominantly in illiquid equity stakes in the funeral sector and cemetery plots. The fund, formally established under the corporate name Brazilian Graveyard and Death Care Services Fundo de Investimento Imobiliário (CNPJ 13.584.584/0001-31) and operating since Dec 12, 2011, concentrates the bulk of its total assets of R$ 249,578,820.05 in very few assets with extremely low liquidity:
- Cortel Holding Shares: The fund holds 3,472,932 common shares (ON) of Cortel Holding S.A., representing 19.92% of the company's share capital. This stake was valued in the Quarterly Report dated 03/31/2026 at R$ 157,554,529.15 (R$ 157.6 million), corresponding to approximately 63% of the fund's entire net asset value. Cortel operates 16 cemeteries, 8 crematories, 2 crematories for pets, and funeral plans distributed across 6 states. It is a privately held company with a valuation based on a discounted cash flow report prepared by UHY Bendoraytes, lacking secondary market liquidity following the suspension of the IPO project structured by XP in 2021.
- Cortel Receivables: Credits totaling R$ 17.9 million linked to the funeral holding company itself.
- Plots at Morumby Cemetery: Physical real estate for funeral destination with a slow pace of commercialization over the years.
- Cash and Government Bonds: The July 2026 report registered a total maintained for liquidity needs of R$ 3,854,895.83 (R$ 3.85 million), with R$ 1,403,609.36 in immediate cash availability and R$ 2,451,286.47 invested in federal government bonds. Private bond and fixed-income fund fields show a balance of R$ 0.00.
What Is the Real Value per Unit in Liquidation Versus the Market Price?
The answer depends entirely on the discount that will be applied to the sale of Cortel's assets. On Oct 9, 2026, CARE11's market price closed at R$ 3.55. Given an accounting net asset value of R$ 34.58 per unit, the P/NAV multiple stands at 0.1027—representing a price traded at roughly one-tenth of the assets recorded in accounting reports.
The market prices the units at R$ 3.55 precisely because the R$ 157,554,529.15 stake in Cortel Holding depends on private negotiation among closely held shareholders. In a forced liquidation process without an open secondary market, block sales typically involve steep price concessions relative to theoretical valuation reports. If the asset is realized for fractions substantially lower than the UHY Bendoraytes report, the final value returned to unitholders will fall well short of the accounting R$ 34.58.
Verdict: Sell (Rating 3.0 out of 10)
CARE11 remains classified as a Sell by the Rico aos Poucos team. The distortion in the July 2026 report—showing a 3.03% return and a 3.0925% dividend yield in a fund that has not generated earnings for 56 months and accumulated deficits of R$ 1,422,529.04 in 2025 and R$ 477,335.98 in Q1 2026—only confirms the operational and governance noise surrounding the vehicle.
With liquidation approved by unitholders on Mar 8, 2026, the thesis has turned into a pure capital recovery battle in illiquid assets. For those on the outside, the risk of facing years of meetings, audit costs, and unitholder committee expenses does not outweigh the apparent screen discount.
What Should Investors Track in CARE11 Moving Forward?
Investors who hold units of the fund or follow its outcome should focus strictly on the presentation and terms of the document that will define the vehicle's wind-down. Critical points for monitoring are:
- Release of the Liquidation Plan: The delivery of the detailed proposal by Mérito DTVM and Zion Gestão, containing the estimated schedule for realizing the 3,472,932 shares of Cortel Holding (valued on the books at R$ 157,554,529.15) and the R$ 17.9 million in receivables.
- Depletion of the Liquidity Reserve: The burn rate of available cash, which closed July 2026 with R$ 1,403,609.36 in cash availability and R$ 2,451,286.47 in government bonds (totaling R$ 3,854,895.83). Administrative expenses, independent audit hires, and Unitholder Committee costs will consume this liquidity if new revenue does not materialize.
- Convening of the New Formal Consultation: The moment when the final plan is brought to a vote among the 6,893 unitholders to approve asset value cuts and redemption timelines.
