IDB Invest supports Panama’s historic district revitalization by financing a cultural heritage hotel
IDB Invest, a member of the IDB Group, provided a $10.2 million loan to finance the development, construction and operation of Hotel La Compañía, a historic heritage hotel in Casco Viejo, Panama City, Panama. The project will be affiliated with Hyatt’s Unbound Collection and aims to support the revitalization and economic growth of the city’s historic district, which was declared a World Heritage site by the United Nations Educational, Scientific and Cultural Organization (UNESCO) in 1997.
The hotel will be developed in the original site where de Jesuit mission La Compañía de Jesús first settled in Panama in the 16th century, offering a unique lodging experience while helping to restore a cultural and historical landmark. Once in operation, Hotel La Compañía will create approximately 165 jobs, 60 percent of which are expected to be filled by women and two thirds sourced mainly from the local community.
Through its supply chain, the hotel will have a positive impact on Panamanian small and medium enterprises that produce mostly food and handcrafts, creating new market linkages. The developer, Shebandowan Holdings, has already identified potential sources to activate local suppliers and estimates that approximately 60 percent of food and beverage purchases will be from local producers, amounting to approximately $800,000 per year. Furthermore, by attracting more visitors to the historic district, Casco Viejo, the project will also contribute to promoting further investments in the area.
The property will feature 88 rooms and suites, and five unique and complimentary food and beverage outlets for Casco Viejo visitors and local residents. In addition, the developer is taking important measures to restore and protect the ruins of an establishment that dates back to 1688, carries enormous cultural value and has a rich story to tell.
The transaction is an example of coordination between public and private sectors, as the government will restore part of the Jesuit ruins. The developer will also make improvements to a city-owned courtyard that is part of the ruins and will maintain it, under a long-term right-of-use agreement, as an open public garden for Casco Viejo visitors and local residents. Both projects will help transform the area into a key landmark in the historic district.
The operation potentially contributes to six of the United Nations Sustainable Development Goals: No poverty (SDG 1), Decent Work and Economic Growth (SDG 8), Industry, Innovation and Infrastructure (SDG 9), Sustainable Cities and Communities (SDG 11), Responsible Consumption and Production (SDG 12), and Partnerships for the Goals (SDG 17).
This transaction reinforces IDB Invest's commitment to supporting the tourism sector in Latin America and the Caribbean. Considering the significant impact of COVID-19 on the hospitality industry, providing financing for long-term sustainable tourism projects with strong fundamentals is now more important than ever.
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 $12.1 billion in asset management and 333 clients in 24 countries, IDB Invest provides innovative financial solutions and advisory services that meet the needs of its clients in a variety of industries.
About Shebandowan Holdings S.A.
Shebandowan Holdings S.A. is a special purpose vehicle solely created for the development of Hotel La Compañia. It is owned by individual investors of an international nature, with broad experience in the real estate and restaurant sectors. The company sees the potential of Panama and the restoration of its history, as a cornerstone to the continued development of sustainable tourism in Central America.