November 15, 2006

Green Building

P3 model is good for green

Australian firm leads way in P3 green construction

Brian Baker

Staff Writer

toronto

Green construction in Canada is leaning heavily on the new financing trend of public private partnerships (P3s) in an effort to pay the bills on infrastructure construction, particularly in British Columbia and Ontario.

The new P3 framework is a legally-binding contract between government and business for the provision of assets and the allocation of responsibilities and business risks among partners involved in construction. Countries using the P3 structure efficiently include the United Kingdom, Australia and Ireland.

Leading the way in the new financing initiative is the Australian based company Plenary Group, which specializes in health, legal, education, military, commercial, transportation and water infrastructure construction.

The Plenary Group stresses the importance of having a fully integrated approach to building development, through the design, construction, operations and lifecycle of a project. “The P3 framework provides a structured, transparent, competitive process and tendered-design structure of financing for finding new assets,” said Graeme Silvera, vice president, Plenary Group.

“The important thing is, there is finance. That essentially takes away the need to go to another outside source. We have the financing built in, and the financier is at the table with us the whole time and part of the team.”

In the UK, P3s have developed 40 new hospitals with another 60 on the way, and have contributed to 150 new schools, with 250 more underway.

In Australia, the focus is on health, courts, television studios, transportation and water sectors in the state of Victoria. Projects financed by P3s are responsible for the maintenance of the buildings for at least 35 years after construction.

“The fact that we are responsible for the operation maintenance of a facility means we cannot look at first costs as the be-all and end-all criteria,” said Silvera.

British Columbia has developed sports complexes in the cities of Chilliwack, Kelowna and Victoria with partnerships in the private sector.

Since May 2003, P3 projects in B.C. include the Academic Ambulatory Care Centre in Vancouver, the Fraser River Crossing Project, Abbotsford Hospital, Coquihalla Highway and Richmond Airport Vancouver transit line.

“For hospital construction, we bring in the best possible designer in the world, who has designed hospitals in international settings with the latest technologies and efficiencies,” said Silvera.

P3 models custom pick contractors including the sub-trades based on experience, ensuring the integrity of the project. “With our model, we are forced to set the team from the very day we respond to the RFP,” added Silvera.

“So, we have a contractor on board, we have an architect, maintenance person, and operations. All these people are at the table.”

The goal set by the Plenary Group is to manage user group expectations and demands, not just for developing ‘green’ projects, but on any project.

“We are the stop gap between the users and the design team,” added Silvera.

“The biggest disconnect was always capital versus operating. Under P3, you can mix operating and capital any which way you want; the combinations are absolutely endless.

“It is a huge advantage for green building.”

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