Silicon Border, the industrial park being built near Mexicali for global high-tech chip makers, has formed a partnership with ING Real Estate to develop, construct and operate the park. The deal, scheduled to be announced today, calls for ING to make a $1 billion investment in four phases over 20 years. The money will be spent on infrastructure, commercial services, highways, power generation and water treatment. As yet, the park has no confirmed tenants.
“This is a big win for us,” D.J. Hill, Silicon Border's chairman and chief executive, said yesterday. “They've not only committed to the first phase but the next four phases.”
ING Real Estate asset director Alejandro Cuadros said the New York-based international real estate and asset management firm is increasing its profile in Mexico.
“Silicon Border presents a great opportunity to capture a project that not only do we consider a good investment, but it's also a project that will bring a lot of growth to Baja California and California,” he said in a phone interview from Dallas.
Plans for the 10,000-acre high-technology science park catering to semiconductor process technology and other capital-intensive technology sectors were unveiled in July 2004 by Hill and Ron Jones. The two Rancho Santa Fe entrepreneurs have backgrounds in high-tech industrial park development in Asia.
They gained commitments from Mexico's federal and Baja California's state governments to extend tax and other incentives to companies locating in the Silicon Border park.
In mid-2005, Silicon Border held a ceremonial groundbreaking on two parcels west of Mexicali that total 15 square miles. About $10 million has been spent so far on the land and on marketing and sales efforts, Hill said.
So far, no companies have decided to locate at Silicon Border.
However, Hill said, “There's a number of clients in the due diligence process.”
He said the amount of investment needs to be high to create a science park that will attract leading-edge manufacturing operations for semiconductors, flat-panel displays, solar panels and biotechnology.
In addition to special wiring and plumbing for high quality power and water, Hill said, the park will include technical training and research facilities in a campuslike setting.
He said profits from the enterprise will be split roughly 50-50 between Silicon Border and ING.
“They'll put in most of the capital,” Hill said.