Fraport Group’s Lima Airport Partners (LAP) has signed a $1.2bn project funding agreement for the development that is currently underway at Jorge Chávez International Airport (LIM) in Peru.

The capital will used to support the construction works at LIM as well as repay the $450m funding that LAP secured in 2020.

Airside expansion works include a second runway, taxiways, a firefighting station, along with other ancillary facilities.

This project also includes a new air traffic control (ATC) tower designed to offer complete coverage of the expanded airfield.

The financing has been arranged by various financial institutions including BBVA, IDB Invest, KfW IPEX Bank, Mitsubishi UFJ Financial Group (Mufg), The Bank of Nova Scotia, Société Générale, Sumitomo Mitsui Banking Corporation (SMBC).

Fraport AG CFO Dr Matthias Zieschang said: “This is a landmark transaction. We are pleased by the continuous strong demand from the international capital markets for financing Lima Airport’s strategic development.

“More than ever, well-managed aviation hubs like Lima are highly regarded as critical infrastructure and reliable long-term investments. This privately financed infrastructure development underscores our commitment to the long-running Lima airport concession and to Peru.

“We are confidently transforming the Lima hub with future-oriented, flexible, and sustainable infrastructure to meet the aviation challenges in the decades ahead.”

LAP also selected Inti Punku consortium, which includes Spanish firm SACYR and Cumbra of Peru, as the general contractor for the engineering, procurement and construction of a new passenger terminal.

This terminal is slated to begin operations by January 2025.

The construction works also include aircraft parking stands, a utilities complex, access roads and public parking.