The Inter-American Development Bank today announced the approval of $100.4 million loan to the Municipality of São Paulo to support the renovation and transformation of the central core of the downtown area.
The project will support planning and investments to restore the dowtown area by financing the rehabilitation of buildings and homes, temporary housing for street families, establishment of high-technology service industries and regularization of informal businesses.
Urban infrastructure and historic buildings will be upgraded, and modern management systems introduced. Public transportation and traffic circulation will be improved, and the administrative capacity of the Municipality will be strengthened.
A pilot program will benefit very low-income families by reclaiming abandoned buildings for low-cost rental properties.
Incentives will be provided to families wishing to move downtown, and while new construction will accommodate those families that need to be resettled because of the urban renewal construction process.
The program will revitalize the economic and social development of downtown São Paulo, which is suffering a loss of middle class population and falling property values. The project will consolidate a participative model for decision-making by the municipal government to promote inclusion of groups now isolated from civic life.
The project, to be carried out by the Empresa Municipal de Urbanização,* reflects the Bank strategy of encouraging local governments to undertake programs to improve the quality of life of their populations and provide essential infrastructure.
The total cost of the project is $167.4 million. The loan is for a 25-year term at a variable annual interest rate with a six-year grace period. Local counterpart funds total $67 million.
In a related project, in 2001 the Bank approved a $37 million loan to the state of São Paulo for a project to assist low-income families in cities buy homes or improve their residences.