At first glance, the post-Thanksgiving afternoon nap seemed to stretch out across the USA this week, with relatively few new tenders coming forward - but despite the lull, some of the major industry themes continued to show their head.
News broke of the bond ratings for the first PennDOT bridge bundle; looks as though one the USA’s most watched P3 projects is close to reaching financial close.
And some exciting new pipelines have started germinating - most notably Tennessee Department of Transportation’s signals that it is set to explore the model to address future infrastructure gaps. Although some legislative hurdles stand in its way, its recent ‘challenges and solutions’ white paper presents a committed picture.
Similarly, emerging markets in the Caribbean also took some steps forward: Jamaica’s PM praised P3 as a “win-win” as it closed the deal for its first waste P3. With a huge road project coming down the tracks as part of a varied P3 pipeline, the country could become a regional hotspot.
In Colombia (whose P3 future was questioned by some parts of the industry with the change of government) a new study was launched into a new international airport concession.
It’s not all been plain sailing, however.
In Puerto Rico, an important P3 was close to being scrapped as its performance was deeply questioned, including by the governor.
The flagship LUMA P3 project, which was intended to revitalize and strengthen the island’s hurricane-battered energy system, suffered some political upheaval as locals protested its outages and lack of progress.
Local officials traced the underperformance to issues such as labor shortages, a common problem the world over. Ultimately, however, it was decided to extend the contract despite the pressure.
In Canada, P3s also saw a mixed picture.
The final report of the Ottawa Light Rail Transit Commission also came this week, which gave an interesting insight into the wrangling between the public and private sectors on the contentious project, which has suffered numerous delays and setbacks.
P3s came out with a divided take. The review noted how the model had provided substantial financial protection for the public sector - but pointed to a fractious and adversarial relationship that had arisen between parties. One eye-catching phrase was that both sides had “lost sight of the public interest during the project”.
A divided public-private partnership is a failure in terms, but sometimes the transactional approach to risk management and other issues can be fertile ground for this kind of troublesome relationship.
Conversations around the progressive P3 model boast a much closer relationship between sides, and with Ontario’s Ottawa hospital progressive P3 being tendered this week, wind clearly remains in the model’s sail.
As we’re somewhat used to over the last few years, huge geopolitical upheavals such as inflation, coronavirus, and war in Ukraine, continue to drive change in the P3 market. Whether it’s IIJA’s new project spurring, or LUMA’s project issues, it’s never a dull week.