Alberta Schools Alternative Procurement Project (ASAP II)
Location: Edmonton, Calgary, Langdon and Okotoks
Status: In Operation
Value of Partnership: $253 million
Type of P3: DBFM
Handback: 2042
Based on the previous success of the P3 model in delivering schools in high growth regions (see ASAP 1), the Government of Alberta moved forward with plans for a second P3 school bunding project.
The ASAP II RFP process was announced on the heels of the 2008 global finance crisis and the province was concerned with the availability within the marketplace to finance such a large project. As such, the province restructred the project to minimize the debt requird through a 50 per cent provincial contribution.
The original plan for ASAP II called for 14 schools (four high schools and 10 elementary and middle schools). The package was subsequently restructured to deliver only the 10 elementary and middle schools using a P3 model, with the high schools delivered as a separate design-build bundle.
In April 2010, the Alberta government entered into an agreement with B2L Partnership for the design, building, financing and maintenance of the 10 new schools. Construction was completed in June 2012, with B2L Partnership responsible for maintaining the schools until June 2042.
By using a P3 to design-build-finance-maintain the 10 schools, the government estimated it saved $105 million in 2008 dollars over the length of the 32-year agreement compared to a traditional design-build approach ($253 million instead of $358 million) and delivered them two years sooner to their communities.
The schools remain publicly owned. Payments to the private sector consortium over the 30-year maintenance period of the project agreement depends on the availability of classrooms and the consortium’s performance.
Partners: Infrastructure Alberta and B2L Partnership (HOCHTIEF PPP Solutions GmbH, parent company of HOCHTIEF PPP Solutions North America Inc., invested 50 per cent of the project's equity, with GVest Infrastructure and Development Fund 1 and Connor, Clark & Lunn GVest Traditional Infrastructure Limited Partnership, each an affiliate of Gracorp Capital Advisors Ltd., providing, in aggregate, the other 50 per cent. The design-builder for the project is a joint venture of Graham Construction and Bird Construction, and the renewal and maintenance contractor is Honeywell)
In 2013, a 100 per cent interest in ASAP II, and the associated project company B2L Partnership, was acquired by Concert Infrastructure from HOCHTIEF PPP Solutions GmbH and Connor, Clark & Lunn GVest Traditional Infrastructure Limited Partnership.
B2L Partnership initially financed the project with a senior long-term credit facility through Sumitomo Mitsui Banking Corporation, the Bank of Ireland and ATB financial. The initial financing included both a short and long-term bank facility totaling approximately $92 million. In 2018, the financing was replaced by a private placement bond financing with The Manufacturers Life Insurance Company and Manulife Canadian Private Debt Fund.
