Lobraus to build 21 story office tower and logistics facility in the port of Montevideo

Simulation of the proposed Lobraus Tower in the port of Montevideo’s free trade zone

The logistics company Lobraus is expected to begin a major development project within the port of Montevideo’s free trade zone by early in 2014. The project will include a 21 story office tower and a 30,000 square meter logistics depot.

The logistics company Lobraus was the only company that bid on a public tender to improve the port issued by Uruguay’s National Port Administration (ANP). The ANP is in the final stages of reviewing Lobraus’ proposal and is expected to approve it in the next few weeks.

Lobraus had originally presented the undertaking to ANP in 2007 as a private project but now they will operate a public concession. The proposed Lobraus tower would be the first high-rise building in the port. It is predicted to house offices for more than 250 companies, along with restaurants, a convention center and auditoriums.

The building will be 17,000 square meters and utilize the latest generation technology to guarantee security and reduce its environmental impact. There will be four parking levels.

The tower will be complemented by the largest storage and logistics facility in any Uruguayan port. The proposed facility will be able store 800,000 cubic meters.

The total cost of the project is predicted at $55 million USD. 70% of the investment will be financed with bank loans and the remaining 30% will come from development funds and private sources. Construction is expected to take three years.

The port facility will be constructed first and then the tower. Lobraus will receive a 30 year concession for the area being constructed as well as additional space attached to the development. The concession begins

The project will be built within the port’s free trade zone, which grants tax benefits to business located within it. Additionally, a foreign company can open an office within that section of the port without creating an Uruguayan company.

The idea behind the project is that foreign companies will locate their offices within the tower and store their merchandise at the depot before it is distributed or sold in the region.

Although Lobraus was founded in the United States in 1989, today it is headquartered in Montevideo with offices in the ports of Montevideo and Punta Sayago. It also has offices in the United States and Brazil. The company is already involved in the construction of several other logistics depots throughout the region.

This Uruguayan Business Reports news article is a translation of a news article that appeared in the Uruguayan newspaper El País. The original article is available in Spanish here. Uruguay Business Reports translation by Donovan Carberry.

In Uruguay’s construction industry unions and construction companies agree to peace to avoid a flight of investors

The Chamber of the Eastern Construction Industry (CICE) and Single Union of Construction and Annexes (SUNCA) agreed to open a dialogue to avoid drastic measures like occupying work sites.

The two sides are concerned about the realities affecting the construction sector, which has been hurt by Uruguay’s tax sharing agreement with Argentina and the foreign exchange crisis in Argentina, and so have agreed to head off an eventual crisis between management and workers that would produce a “run by some investors”.

The agreement was reached during a working meeting that both parties attended Tuesday night, June 12 in the CICE’s headquarters. “Neither of the two sides want a run by investors. It was a very productive meeting because we agreed on all the points we touched on”, the president of the CICE Miguel Corbo told El País.

“There were more points of agreement than disagreement. Some projects are moving extremely slowly. There are other projects that rumors say will not begin. We are eagerly waiting to see if they are true or not. They can not delay continue to delay the start of projects that have been advertised for before the end of the year” said Corbo.

“We agreed to continue meeting to analyze the topic that concerns us all which is maintaining a source of work and the theme behind that is not letting construction fall. Basically we are talking about conflicts. Both parties want to tone down conflicts now before the end of the year. Not stopping [work] but searching for decisions before making a decision to stop. It was an exchange of opinions so that we both could see how the other side views the situation. We agreed on the topic of combating the informal economy” said Corbo.

 The businessman also pointed out that the peace agreement seeks to avoid an investor, invoking “a force majeure” clause on delayed project to avoid delivering units on time or in correct form to willing buyers”. A stoppage or a strike in the sector could be used as an excuse by some developers. “We don’t want some investor to use it for their own benefit” Corbo emphasized.

There already are some Argentinean investors that because of their anxiety and problems getting dollars, have warned of a possible stop in investments.

This Uruguay Business Reports news article is a translation of a newsstory by Marcelo Gallardo which appeared in the Uruguayan newspaper El Pais. The original spanish language article is available here. Uruguay Business Reports translation by Donovan Carberry.