The U.S. Department of the Treasury recently published an Economic Framework for Comparing Public-Private Partnerships and Conventional Procurement.
The department concluded that there is no single factor that should determine whether a P3 is likely to yield a stronger benefit than one delivered through conventional means. The paper also outlines important steps for a government to take before procuring a P3 project to ensure optimal benefit to the taxpayer.
One key factor cited in the report was the capacity of a project to bundle several projects into one large contract. The capacity to bundle is by far the most important factor in a P3 creating cost savings, the report concluded.
Other important considerations were:
- Private-sector expertise: A strong indicator of whether the project will provide a net-benefit over the full life cycle of a P3 is the technical expertise available.
- Clearly defined terms that are quantifiable: How precisely does the contract lay out the service level required?
- High capital costs and long lived assets: Assets procured using a P3 need to be large enough to generate cost savings that offset the transaction costs of privately raised capital.
Related Stories
| Aug 11, 2010
High-density planning allows abundant open space
Gilroy Unified School District's new Christopher High School in California opened its first phase this fall. The 1,800-student, 231,000-sf facility was designed with a high-density site plan that allows for both on-site sports fields and undeveloped open space. BCA Architects of Fremont, Calif., with Gilbane Building Companies as CM, collaborated with numerous user groups to plan the two-story,...
| Aug 11, 2010
Healthcare construction weathers the recession
Healthcare construction spending grew at a compound rate of more than 10% for seven years through mid-2008, but has stalled since then. The stall, however, still represents better growth than almost any other construction market during the recession, which deepened as a result of the fall 2008 credit freeze.
| Aug 11, 2010
Embassy's dual façades add security and beauty
The British government's new 46,285-sf embassy building in Warsaw, Poland's diplomatic quarter houses the ambassador's offices, the consulate, and visa services on three floors. The $20 million Modernist design by London-based Tony Fretton Architects features a double façade—an inner concrete super structure and an outer curtain wall.
| Aug 11, 2010
Project's mixed materials downplay massing
Philadelphia-based KlingStubbins provided design services for the 120,000-sf Carnegie Center, which is part of the 103-acre mixed-use Carnegie Center West development in West Windsor Township, N.J. The four-story building features horizontal brick bands, ribbons of glass, aluminum accents, and metal end panels and curtain wall at all four corners to break up the building's massing.
| Aug 11, 2010
Firehouse converted to hip hot property
Sound the alarm! A 9,000-sf former firehouse is being converted into a new multipurpose space for ZUMIX, a nonprofit music and arts organization that's partnering on the project with Landmark Structures of Woburn, Mass., and the East Boston Community Development Corporation. The $2 million renovation of the 1920s structure, known as Engine Company 40 Firehouse, includes a complete gut job to ma...
| Aug 11, 2010
High-tech tower targets LEED Platinum
Construction is slated to begin on the new $38 million AI Tech Center in Hartford, Conn., in spring 2010. The Building Team, which includes Suffolk Construction Co., CBT Architects, and Jones Lang LaSalle, planned the high-tech 13-story, 259,000-sf tower to meet LEED Platinum certification. Green features include photovoltaic power, a fuel cell power plant, abundant natural lighting, and a roof...
| Aug 11, 2010
Dave Barista named chief editor of Professional Builder
David Barista has assumed the chief editor position at Professional Builder, a Reed Business Information (RBI) publication, with additional responsibility for Custom Builder, Housing Giants, and HousingZone. Barista joined RBI in 2000, shortly after graduating from Eastern Illinois University, as an editor with Building Design+Construction.
| Aug 11, 2010
And the world's tallest building is…
At more than 2,600 feet high, the Burj Dubai (right) can still lay claim to the title of world's tallest building—although like all other super-tall buildings, its exact height will have to be recalculated now that the Council on Tall Buildings and Urban Habitat (CTBUH) announced a change to its height criteria.
| Aug 11, 2010
Project is music to school's ears
Florida Gulf Coast University is building a $7.55 million Fine Arts Building on its campus near Ft. Myers, Fla. The 25,000-sf building—the first project in the school's plan for an entire music complex—will house the music program of the College of Arts and Sciences. The facility includes a 200-seat recital hall, rehearsal hall, music labs, studio rooms, and administration offices.
| Aug 11, 2010
East meets West in hospital design
The Los Angeles office of HMC Architects and the Chinese firm Shunde Architectural Design Institute won the commission to design the 2.15 million-sf First People's Hospital in the Shunde District of Foshan, China. The team's winning concept organizes a series of buildings around a dynamic, curved spine element to create an interior “eco-atrium” with outdoor green space and healing g...