IDB Invest and American Industrial Park Boost Global Supply Chains in El Salvador
IDB Invest has provided a $25 million financing to American Industrial Park (AIP) in El Salvador, a company owned by Aristos Inmobiliaria, which is responsible for the development, construction, and administration of industrial parks, technology parks, and free trade zones.
The deal will allow AIP to develop and build a new free zone in the Department of La Libertad, that will include several industrial warehouses for national and international clients. The expansion will be aimed at companies whose operations fit the global supply chain, logistics, and manufacturing.
The deal, which has a tenor of twelve years and a grace period of one year, consists of long-term financing that includes a committed tranche of $18 million and an uncommitted tranche of $7 million.
The project is expected to increase the availability of industrial roofs in the country. Currently, the largest industrial warehouse in Central America of 667,000 ft2 is being built and it is expected to have 1,076,000 ft2 with a three-year projection.
In addition, it will allow the installation of renewable energy sources to promote the operational sustainability of the park, mitigating the carbon footprint, allowing its tenants to contribute to the continuity of the business in the face of the possible risk of failures or instability in the public network, as well as provide stability in rates. Additionally, it contributes to the environmental sustainability objectives of its clients.
The new free zone will have around 2,745,000 ft2 of green area reforested with more than 8,000 new trees planted. It will also have a comprehensive recycling program and efficient water management.
This project will be a boost for job creation in El Salvador with the expected hiring of about 200 people in the construction and development phase, and more than 3,500 people when construction is completed in its entirety.
In addition, IDB Invest will offer advisory services to validate the implementation of a battery system for the storage of electrical energy to improve the supply of loads. To do this, a study will be carried out that will verify the implementation of a 1MW pilot plan, to later validate the replicability of the technology to the rest of Aristos Inmobiliaria's industrial parks.
The creation of free zones has allowed El Salvador to increase economic dynamism as a result of investment through exports, the main origin of which is derived from the production of the manufacturing sector, these exports representing close to 50% of the total exportable supply of the country.
This deal is expected to contribute to three of the United Nations Sustainable Development Goals (SDGs): Affordable and Clean Energy (SDG 7), Industry, Innovation and Infrastructure (SDG 9), and Responsible Consumption and Production (SDG 12).
About IDB Invest
IDB Invest, a member of the IDB Group, is a multilateral development bank committed to promoting the economic development of its member countries in Latin America and the Caribbean through the private sector. IDB Invest finances sustainable companies and projects to achieve financial results and maximize economic, social, and environmental development in the region. With a portfolio of US $13,1 billion in assets under management and 385 clients in 25 countries, IDB Invest provides innovative financial solutions and advisory services that respond to the needs of its clients in a variety of sectors.
About Aristos Inmobiliaria
Aristos Inmobiliaria is the division of Grupo Aristos that owns and operates four industrial parks and free zones in the country: American Industrial Park, El Progreso Industrial Park, Apolo Industrial Park, and Sirius Industrial Park. With more than 30 years of experience in developing the best industrial parks in El Salvador, Aristos Inmobiliaria has more than 2,800,000 ft2 of industrial roof, with 40 international clients, and generates more than 14,000 direct jobs. All Aristos Inmobiliaria developments are supplied by photovoltaic solar energy, becoming one of the first 5 solar energy generators in El Salvador. It also has an entire sustainability strategy that allows it to contribute to 9 Sustainable Development Goals in the departments of La Libertad and Sonsonate.
About American Industrial Park
American Industrial Park (AIP) is the largest industrial park in El Salvador with more than 2,260,000 ft2 of industrial roof, which houses more than 26 international companies focused mainly on the textile, clothing, logistics, and storage sectors. The park was founded in 1993, and since then it has continued to grow and diversify, since it constantly invests in the conceptualization, design, construction, and maintenance of industrial buildings for local and international companies, as well as in the diversification of its line of business in the renewable energy sector, mainly in photovoltaic projects both for self-consumption and for supply to local distribution companies in the country.