Newspaper article Evening Gazette (Middlesbrough, England)

Partnerships Assist in Driving Sector Forward; Commercial Property

Newspaper article Evening Gazette (Middlesbrough, England)

Partnerships Assist in Driving Sector Forward; Commercial Property

Article excerpt

PUBLIC-private partnerships are helping drive investment in the commercial property sector.

Construction work recently got underway on a new pounds 75m mental health centre in Middlesbrough.

Roseberry Park, a public/private partnership project, is scheduled to open its doors in 2010 to replace the existing St Luke's Hospital in Middlesbrough.

The project is in part of schemes totalling pounds 110m which the North East Strategic Health Authority is currently investing.

A spokeswoman for the authority said such Private Finance Initiative (PFI) schemes had been used by the NHS for about 10 years, with a number of large schemes in the North-east.

"Because public sector funds are limited, PFI opens up another resource and so more schemes can be built," she added.

"Responsibility for the construction of the buildings fall to the private sector - providing the NHS with a fit for purpose building within a fixed time scale and at a pre-agreed price with no money being paid until the building is finished and in use.

"The private sector also takes responsibility for maintaining the building to a high standing during its life time."

Law firm Ward Hadaway has advised partners on the St Luke's scheme, which is the largest ABC-approved project in the UK to date and recently reached financial close.

ABC, which stands for Appointment Preferred Bidder Business Case, aims to take more of the uncertainty and risk out of public/private partnership projects for bodies such as NHS Trusts and local authorities at an early stage in the process and to speed up the development of new facilities.

Instead of appointing a company as a preferred bidder and then working out the nuts and bolts, ABC sees most of the details worked out and agreed by the public sector bodies and shortlisted bidders before a final preferred bidder is chosen.

John Laing Social Infrastructure has been chosen as the preferred bidder for the facility.

The scheme was also a pilot for the Treasury's Senior Debt Funding Competition, where banks are invited to bid to fund the project after it is approved and the preferred bidder - in this case John Laing - appointed. …

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