SOFIA AIRPORT CONCESSION FL

Promoter – Financial Intermediary

REPUBLIC OF BULGARIA

Location

• Bulgaria

Description

The project consists of the financing of: i) the anticipated "Imminent Works" that are aimed at improving the existing airport facilities by rationalising the use of the current infrastructure, keeping up with the latest safety and security regulations and addressing current service level deficiencies; and ii) phase 1 of the airport development plan required to address operational resilience issues within the first seven years of the 35-year airport concession granted by the Republic of Bulgaria.

Additionality and Impact

The project remedies existing low levels of service at Sofia airport, the single airport facility serving Sofia and the main international air transport gateway of Bulgaria. Low levels of service and congestion from underinvestment constitute market failures. The airport forms part of the Core network of the Trans-European Transport Network for airports, it is a key node in the Orient - East Med corridor and is located on a less developed region.
The Bank's loan fills a market funding gap given the limited access of long term funding for this type of asset and is requested to finance the project, especially in the current Covid-19 crisis conditions. Considering that the project will be the first large scale infrastructure concession in the country, the presence of the Bank in the project will ensure that international standards are applied.
Given EIB's provision of a long term financing potentially longer than other senior lenders, it will play a role as anchor lender attracting future lenders at the time of refinancing.

Objectives

The investment will alleviate existing capacity shortfalls and address current service level deficiencies, enhancing operational resilience and passenger service standards but also improving the sustainability of airport operations in terms of building and equipment energy efficiency and safety considerations.

Sector(s)

• Transport - Transportation and storage

Proposed EIB finance (Approximate amount)

EUR 40 million

Total cost (Approximate amount)

EUR 101 million

Environmental aspects

A number of investment schemes included in this framework loan would normally be classified under Annex II of the Directive 2014/52/EU amending the EIA Directive 2011/92/EU, meaning that the Competent Authority makes the decision as to whether a formal environmental impact assessment (EIA) is required or not. Alignment to this and to other national and EU environmental legislation, including EU Directive on Energy Performance of Buildings, and the status of any pre-existing development consents will be reviewed and assessed during appraisal.

Procurement

The borrower has been assessed by the EIB as being a private company not subject to EU rules on public procurement or concessions.

Status

Signed - 12/07/2021