Infra Insight Blog

Los Angeles World Airports (LAWA) and LA Gateway Partners, LLC  (LAGP), together with equity providers and lenders, achieved Financial Close on the approximately $2 billion consolidated rent-a-car facility (ConRAC) at Los Angeles International Airport (LAX) on December 6, 2018.

LAGP is owned indirectly by funds managed by Fengate Asset Management ("Fengate LAGP US I, LLC", 83.3%) and PCL Investments USA, LLC ("PCL LAGP Partnership LP", 16.7%). After achieving Commercial Close on November 6, 2018, Fengate and PCL proceeded to secure private financing for the project  comprised ...

The State of Delaware and a subsidiary of Gulftainer Company Limited (Gulftainer) have finalized a concession agreement for the operation and further development of the 100-year-old Port of Wilmington (Port).

While the concession agreement signed on September 18, 2018 is not publicly available, it is expected, based on deal terms described in Port documents submitted in support of approval of the P3 transaction,[1] that the agreement grants Gulftainer exclusive rights to manage the Port for a 50-year term. In return, Gulftainer agrees to invest up to $584M in the Port in the first ...

On June 8, 2018, the City of Los Angeles, acting through the Los Angeles World Airports (LAWA) Board of Airport Commissioners, and LAX Integrated Express Solutions, LLC (LINXS) successfully reached financial close on the $4.9 billion agreement for the APM project.

After reaching commercial close with LAWA on April 11, 2018, LINXS proceeded to secure equity contributions and to arrange and close both bond and bank financings for the project.  Private financing for the project is comprised of approximately (a) $1.2 billion in private activity bonds issued by the California Municipal ...

The Automated People Mover (APM) train system project at Los Angeles International Airport (LAX) reached a remarkable milestone this week with Los Angeles City Council’s unanimous approval of a $4.9 billion agreement with LAX Integrated Express Solutions (LINXS).

With City Council’s approval in hand, the City, acting through the Los Angeles World Airports (LAWA) Board of Airport Commissioners (BOAC), and LINXS reached commercial close on April 11^th, signing the project agreement. LINXS will now proceed to obtain private financing for the project, and financial close is ...

The Canadian government is taking a new approach to P3s.  By the end of 2017, PPP Canada will have ceased operations, and the Canada Infrastructure Bank (the CIB) will be launched.

Year end is nearly upon us.  What has PPP Canada accomplished, and what is expected from the new CIB?

PPP Canada’s Contributions

PPP Canada was established by the Harper government in 2008.  At that time, certain provinces were already very experienced in the delivery of large and complex public infrastructure projects using P3 delivery models (including British Columbia, Alberta and Ontario).  The specific ...

Los Angeles World Airports (LAWA) released the Final Request for Proposals (Final RFP) for the procurement of the elevated 2.25-mile Automated People Mover train (APM) at Los Angeles International Airport (LAX) on July 28, 2017. The Final RFP was provided to the three short-listed Proposer teams participating in the APM procurement.

The project is the first APM system to be procured through an availability payment public private partnership (P3) delivery model.  The selected Proposer will design, build and partially finance the APM system, and then will operate and maintain the ...

Los Angeles County Metropolitan Transportation Authority (LA Metro) is pursuing new public-private partnership (P3) legislation, Assembly bill ABX 1-12 (Bill 12).  Bill 12, introduced and read for the first time on August 26, 2015 at the California extraordinary session on transportation, would give LA Metro greater flexibility and autonomy to procure and finance transportation infrastructure in the LA Metro region.

LA Metro currently has authority under Section 143 of the Streets & Highway Code (Section 143) to deliver transportation projects using a P3 model with the use of ...

The Performance Based Building Coalition (PBBC) and the National Council for Public-Private Partnerships (NCPPP) together hosted the P3s for Public Buildings Summit in Miami on November 17 and 18, 2014.

One of the panels formed for the Summit reviewed Best Practices for Public Building P3 Projects: What Works and What Doesn’t? The panel was skillfully moderated by Mark Romoff, President & CEO of the Canadian Council for Public-Private Partnerships.  The panelists were  Orion Fulton, Senior Manager at Arup, Bill Maginas, Vice President at Honeywell, Douglas Scott, Senior ...

Many federal, state and local government agencies are looking for innovative and cost effective methods to deliver essential social infrastructure such as educational facilities, hospitals and criminal justice facilities and related infrastructure.  As a result, these agencies are increasingly interested in assessing and pursuing the P3 delivery model.  However, these agencies often lack clear statutory authority to use a P3 delivery model for social infrastructure.  Recognizing this gap, Nossaman has developed a model social infrastructure P3 bill, based on its extensive ...

As demand for government services continues to grow across the United States, federal, state and local government agencies must identify innovative and cost effective methods to deliver essential social infrastructure. While many agencies are interested in pursuing innovative P3 delivery models to procure public buildings, they often lack the clear necessary legislation to authorize P3 deals.

We offer below, for consideration and comment, a draft model social infrastructure P3 bill.  We developed the draft legislation based on our experience advising US public agencies ...

On Tuesday, April 8th, the House Transportation and Infrastructure Panel on Public-Private Partnerships held a hearing on "The International Experience with Public-Private Partnerships".  The Panel focused in particular on the Canadian experience, observing that over the past two decades Canada has become one of the most advanced and active markets for P3s. The witness list and links to their testimony are as follows:

The Honorable John Delaney, United States Representative, Maryland

Dr. Larry Blain, Chairman of the Board of Directors, Partnerships British Columbia | Written Testimony

Mr. David Morley, Vice President, Business and Government Strategy, Infrastructure Ontario | Written Testimony

Cherian George, Managing Director – Americas, Global Infrastructure & Project Finance, Fitch Ratings | Written Testimony

Dr. Matti Siemiatycki, Associate Professor, Program in Planning, University of Toronto | Written Testimony

Congressman John Delaney began by describing the magnitude of the nation’s infrastructure deficit.  Referring to an estimate made by the American Society for Civil Engineers, he explained that close to $4 trillion needs to be invested to bring infrastructure in the US up to world class standards.  As governments are cash strapped, he advocated that private sector capital be engaged to increase investment in infrastructure to fill the gap, and he noted the importance of smart P3 frameworks to meet this infrastructure challenge.  Congressman Delaney referred to The Partnerships to Build America Act (H.R. 2084), which he introduced to the House on May 2013.  He explained that The Partnerships to Build America Act would provide for the financing of state and local government transportation, energy, communications, water, and education infrastructure projects through the creation of an infrastructure fund.

The Panel did not put questions to Congressman Delaney, leaving that for the House. The Panel did, however, engage in a lively discussion with the remaining witnesses about the Canadian experience with P3s and explored the suitability of the Canadian approach for infrastructure projects in the US.

Witnesses outlined various factors that have resulted in successful P3 projects in Canada.  The creation of specialized provincial agencies staffed with experts skilled with both evaluating projects for P3 delivery and negotiating with the private sector was noted as a significant factor contributing to successful P3 deals. Further, the development by these agencies of consistent and predictable procurement processes and standardized documentation has facilitated the delivery of P3 projects and encouraged the development of the P3 market in Canada.

Mr. George of Fitch Ratings, discussing P3s from a global perspective, pointed out that P3s can provide public value, but these transactions need to be appropriately designed and carefully crafted to address all stakeholder concerns.  He indicated that projects that have a defined scope where performance can be measured are better suited to P3 delivery.  He noted that lessons can be learned from past P3 projects undertaken around the world.  He spoke to a few examples including the 407 toll road in Ontario and Chicago’s Skyway toll concessions, each of which came under considerable criticism and involved legal disputes.

Witnesses pointed out that in Canada P3s are not typically used to raise new money to pay for infrastructure through user fees or tolls.  Instead, P3s are viewed in Canada as a way to finance a project using private capital that is repaid overtime by the government through availability payments.  Congressman Sean Patrick Maloney (D-NY) indicated that while P3s are not viewed as a funding solution in Canada, P3s are being considered for that purpose in the US.