In 2012 the new Dutch government has expressed strong political support for PPP in the future. PPP is sees as a means to achieve the goal of value for money: more quality for less money.
In the EU the Dutch PPP market is seen as very attractive and interesting. Some of the key points are: focus on value for money and balanced distribution of risks; standardisation (eg standardised contract available in English, tender-guidelines, PSC, PPC, market scan); professionalism and expertise of private and public sector; as well as a strong pipeline of projects (around € 5 to 6bn in the next five years).
Dutch PPP projects are still being financed by banks. To further widen and deepen the financing market and thereby increase competition, the Dutch government has taken steps to accommodate capital market financing and institutional investors.
In the A1/A6 road project for instance, the tender process and procurement documentation was changed to accommodate capital market solutions. Two of the three participating consortia had capital market financing arrangements.
In November 2012 the N33 road was closed. This pilot project involved compensation for inflation on the debt financing. The Dutch pension fund APG won the bid. Currently an evaluation on the basis of the N33 outcome is ongoing to determine whether it delivers value for money if the Dutch government would compensate for inflation on the debt financing of PPP projects in the future.
What areas should investors be keeping an eye on for next year?
The financing of PPP projects is a key priority for 2013. Bank financing remains strong. The government will take further steps to accommodate capital market solutions, making use of the experiences of the A1/A6 and the N33.
Projects in the road sector will continue to come to market as planned, such as the A9 Gaasperdammerweg, which is currently being tendered and is expected to close mid 2014. A new and interesting area is a programme of six water locks which is currently underway.
Have you noticed a change in investors over the last year, are you attracting more pension funds and such?
Indeed. There has been a significant increase in appetite from institutional investors and funds, both Dutch and foreign, in investing in PPP projects. They are looking at the Netherlands for good, stable and transparent projects and a solid pipeline for the future.
Are there any potential barriers to dealflow over the coming year?
The Dutch government is constantly trying to further standardise and streamline the tender process and contracts. The government consults the private sector periodically. Any barriers that would prevent the further increase of the potential value for money are being mitigated.
Financial close was recently completed for a new supreme court building in the Hague. What other projects do you hope to soon complete?
The A9 Gaasperdammerweg is currently in tender. The close is expected mid 2014.
Furthermore a couple of building projects are in tender, such as Zaanstad, RIVM and Rijnstraat 8.
Are there any particular areas of infrastructure (such as water, rail, energy) you see the Netherlands concentrating on in the next year or hope to diversify into?
PPP in the Netherlands has mainly focussed on roads and building in the past couple of years. A new area will be water locks. A programme has been set up, which will start with a few relatively small projects and end with large projects such as the sea lock in Ijmuiden, near the port of Amsterdam.
Another interesting new sector is rail. Currently a couple of pilot projects are being analysed to see if PPP can deliver value for money for rail projects, in the context of the dense existing network and safety systems of the Netherlands.