Banks Make Biggest Loan Since Turkish Coup to Back Port Projectby
Six Turkish banks lent 1.02 billion euros ($1.14 billion) to a venture run by companies owned by billionaire Ferit Sahenk and businessman Serdar Bilgili for the development of Istanbul’s Galataport, the biggest financing for a project since a failed coup in July.
The joint venture between Sahenk’s Dogus Holding AS and Bilgili’s BLG Gayrimenkul Yatirimlari AS, known as Salipazari Liman Isletmeciligi ve Yatirimlari AS, signed a 14-year facility with the lenders, Dogus Chief Executive Officer Husnu Akhan told reporters on Wednesday. There will be no repayments for the first 3 1/2 years, he said.
The company will use the loan to repay $600 million it borrowed in 2014 to finance a $702 million bid for the 30-year rights to build and operate Galataport, Akhan said. The remainder will be used to finance the project, which will have a total investment cost of 4.5 billion liras ($1.52 billion) that will include ports for cruise ships, shopping malls and a hotel project at Istanbul’s Karakoy district, he said.
The agreement was signed with lenders including Yapi Kredi Bankasi AS, which provided 275 million euros to the project, Turkiye Garanti Bankasi AS, which allocated 255 million euros, and Turkiye Is Bankasi AS, which contributed 150 million euros. TC Ziraat Bankasi AS is providing 130 million euros, TSKB AS 110 million euros and Finansbank AS 100 million euros, according to a statement.
The venture also signed an agreement with Hongkong and Shanghai Hotels Ltd. to build a 300-million-euro hotel at the site, Akhan said.