Tropicalia Sustainable Tourism

inactive

The IIC will support the construction and operation of a 169-room Four Seasons hotel and 24-unit branded residential component (the “Project”) to be known as Tropicalia, located in the municipality of Miches, Dominican Republic, a town of approximately 21,000 inhabitants, mostly unskilled workers and farmers (68.9% of whom live in poverty and 21.0% in extreme poverty). Tropicalia is sponsored by the real estate division of the Cisneros Group, a media, entertainment, telecommunications, and tourism group headquartered in the U.S.A. (“Sponsor”). The Project encompasses an area of approximately 27 hectares with 1 kilometer of beachfront. The Project will feature multiple restaurants, meeting facilities, a wellness center and spa, a local crafts market, and a variety of complementary recreational amenities.The total Project cost is estimated to be US$240 million, and will be funded with a combination of equity from the Sponsor and debt from development finance institutions and local commercial banks. The IIC will provide an A-Loan of up to US$ 40 million for the debt portion. The proposed IIC financing will be structured as a senior secured loan and have the tenor of up to 12 years.The Project is an important economic catalyst for the Dominican Republic, which welcomes more than five million visitors annually. In response to the Project’s holistic approach to development, Tropicalia established its foundation, Fundación Tropicalia in 2008 to design and implement programs for the neighboring communities in the areas of education, environment, productivity, and socio-cultural advocacy. The Foundation’s goal, together with the local community, is to be a driver of sustainable and socioeconomic development in the region. The Project will seek the Leadership in Energy and Environmental Design (“LEED”) certification and will employ numerous sustainability features to reduce environmental impact. In addition, the IIC will provide financial additionality given that long term financing for large-scale tourism projects in the Caribbean is very limited.The Inter-American Development Bank Group has been actively working with Tropicalia for several years. After identifying the need to promote economic development, the Multilateral Investment Fund (“MIF”) initiated the project “Inclusion of Microenterprises and Small Businesses in the Sustainable Tourism Value Chain in Miches” in 2012, with the objective of improving the social and economic conditions for local agricultural producers and small business operators. Realizing the slow but consistent positive impact of this initiative (see more below), the IDB decided to further support the region and accelerate its growth by financing the construction of the DR-104 highway, a modern highway connecting the popular town of Punta Cana to Sabana de la Mar, located west of Miches, that opened in 2016. The highway, which extends for approximately 110 kilometers, has dramatically reduced the drive time from the Punta Cana Airport to the area to less than one hour. Tropicalia seeks to build upon the successes of the MIF and IDB to further catalyze and accelerate the development of Miches through a private sector, high-impact sustainable Project.