ANNOUNCEMENT 26 Oct 2018
In October 2018, the European Investment Bank (EIB) signed a loan agreement with Lar España Real Estate SOCIMI, S.A to support its construction project of a retail shopping centre in Lagoh, Spain. The loan will be guaranteed by the European Fund for Strategic Investment (EFSI).
NUMBER OF INTERVENTIONS
The European Investment Bank, Financed Projects, SUSTAINABILITY RETAIL DEVELOPMENT: http://www.eib.org/en/projects/loan/loan/20180043
The European Investment Bank, Project summary, Project No. 20180043, SUSTAINABILITY RETAIL DEVELOPMENT: http://www.eib.org/en/projects/pipelines/pipeline/20180043
The European Investment Bank, press release of 26 October 2018, Juncker Plan: EIB signs loan with Lar España to support urban regeneration: http://www.eib.org/en/infocentre/press/releases/all/2018/2018-272-juncker-plan-eib-signs-loan-with-lar-espana-to-support-urban-regeneration
Lar España Real Estate, Regional Shopping Centre development in Seville, with a catchment of 1.5 million inhabitants: https://www.larespana.com/en/portfolio/shopping-centre-lagoh/
European Commission (13 January 2015): The Investment Plan for Europe: Questions and Answers: http://europa.eu/rapid/press-release_MEMO-15-3223_en.htm
EIB: European Fund for Strategic Investments - Questions and Answers. Available at: http://www.eib.org/attachments/press/investment_plan_for_europe_qa_en.pdf
The loan agreement between the European Investment Bank (EIB) and Lar España Real Estate SOCIMI, S.A was signed on 26 October 2018 and has a total value of EUR 70 million (approx. USD 79.7 million).
The loan supports the company's construction project of a retail shopping centre in Lagoh, Spain.
Lar España Real Estate SOCIMI, S.A business activities focus on investments throught Spain in real estate assets including shopping centres. The company has its headquaters in Spain.
A state act in the GTA database is assessed solely in terms of the extent to which its implementation affects foreign commercial interests. On this metric, the investment support granted here is discriminatory.
The EIB's loan to Lar España Real Estate SOCIMI, S.A signed on 26 October 2018 was issued under the European Fund for Strategic Investment (EFSI). The loan has a total value of EUR 70 million (approx. USD 79.7 million) and will support the company's construction project of a retail shopping centre in Lagoh, Spain.
The EFSI is a joint initiative by the EIB and the European Commission to promote investment in Europe. The EIB has designated EUR 7.5 billion of its capital for lending to European projects with a higher risk profile than usually taken on by the bank. To compensate for the increased lending risk, the European Commission has agreed to fully guarantee all lending under the EFSI up to a budget of EUR 26 billion. The loan described was issued under the EFSI and thus benefits from a full guarantee through the EU budget.
EFSI support does not fall under EU State Aid rules as it is meant as a tool to address "market failures or sub-optimal investment situations". However, the investment support does include favourable conditions in the form of public assumption of risk.
As described in the European Commission's Fact Sheet from 13 January 2015: "The type of risk-financing instruments will be designed so as to take uncertainty out ("first loss protection") of as such viable projects and therefore crowd-in private sector investments. Since the EFSI will take riskier tranches in investment projects, the private sector will be able to join under more favourable conditions." Furthermore, the EIB states that "The new initiative [i.e. the EFSI] will benefit from the EIB’s strong credit standing that enables funding at favourable conditions and across maturities".