SANTIAGO, Chile--(BUSINESS WIRE)--Parque Arauco S.A. (SSE: PARAUCO; Bloomberg: PARAUCO:CI) (“Parque Arauco”) announces that its subsidiary, Parque Arauco Colombia S.A. (“PACSA”), signed a collaboration agreement, “The Agreement” with the real estate developer and contractor IC Constructora S.A. (“IC”) to develop a multi-family residential property in Bogota, Colombia.
The Project called "Proyecto Calle 72" consists of the construction of a residential property with an approximate total GLA of 6,500 m2 of residential space and 1,500 m2 of commercial space. This 7-floor building is expected to have 132 apartments, 111 parking spaces, and will also include amenities such as a gym, co-working area, BBQ area, game room, washing machine room, and a rooftop panoramic terrace. The project will begin construction in 2022 and is expected to be completed in 2024.
In accordance with the Term Sheet signed on December 21st 2021 by Inversiones Colombianas Arauco S.A.S. (“INVECA”) and IC, this Agreement states that the Project will be developed through a trust and that once construction is completed, 80% of the shares will be owned by Parque Arauco Colombia S.A. (“PACSA”) and 20% of the shares will be owned by IC.
As part of the collaboration agreement, IC will provide the property and will be responsible for executing and carrying out the construction of the Project, as well as its management. Parque Arauco will be responsible for monetary contributions according to an investment and construction schedule. Parque Arauco will contribute its experience and knowledge in the development of real estate projects to define the technical specifications, the general project schedule, the final budget, technical and financial aspects of the Project, the architecture, and the progress of the work.
The project will require a total investment, at the asset level, of approximately US$ 11 million. The obligations of the Parties of the collaboration agreement are subject to the fulfillment of usual legal conditions for this type of transaction. The agreement states the option for PACSA to acquire the remaining 20% of IC, and for IC to sell it, subject to certain terms and conditions that must be fulfilled over the years following the start of operations.
Eduardo Pérez Marchant, General Manager of Parque Arauco International mentioned, “This agreement marks the beginning of our investments in stand-alone properties of an asset class distinct from shopping malls. We believe that multi-family properties will grow strongly in Colombia over the next few years. We are convinced that investing in this type of real estate will contribute to reinforcing our strategic growth and profitability pillars. On the other hand, obtaining expertise in multi-family will allow us to continue developing successful shopping centers in central areas of important cities in the region, densifying and increasing the profitability of these commercial projects. We are actively looking for other multi-family projects in Peru and Colombia that will positively impact our EBITDA in these countries.”
Currently, Parque Arauco has 1,069,500 m2 of total GLA in Chile, Peru, and Colombia. The company inaugurated its first shopping center in Chile in 1982, entered Peru in 2005 and Colombia in 2008. The company’s assets include 17 regional shopping centers, 10 neighborhood centers, 7 premium outlet malls, 21 strip centers and 9 offices, medical centers, and hotels across Chile, Peru and Colombia. In addition, Parque Arauco has a land bank to contribute to the company’s future growth plans. For more details, visit the company’s website: www.parauco.com.
