U.S. P3 Market Year in Review
2019 was a banner year for public-private partnerships ("P3s") in the United States. More states than ever have enacted P3-enabling legislation. While many of these are transportation-related, it is clear that funding shortfalls combined with the need for better infrastructure has caused legislators to take a hard look at P3s.
The best example from the past year is Louisiana's legislation, passed in October, that resulted in the Louisiana Belle Chasse Bridge and Tunnel Replacement Project Agreement being executed with a team led by the Plenary Group in December. It is a DBFOM, a fixed, four-lane bridge and construction to start in Spring 2021.
In terms of successful projects, it was a great year for social infrastructure. Star America and Balfour Beatty reached financial close on the fourth phase of a mixed-use student housing project for UT Dallas. The 5-acre development includes residential and retail. Travis County Courthouse reached financial close in April 2019. This project is a design, build, and finance of a 430,000 square foot civil and family courthouse. It was completed by a consortium led by Amber Infrastructure and Hunt Development. Also, the consortium leading the Howard County Courthouse broke ground in June. Finally, just this past month, the Miami Dade County Courthouse was awarded to a consortium led by the Plenary Group and commercial close is imminent.
The water and sewer industry hit a couple of snags. After going through a procurement process and negotiating a comprehensive agreement for water and sewer infrastructure improvements, the Township of Edison, New Jersey voted to kill the deal and keep the utility publically-operated. Ascension Parish, Louisiana, also ended up in court over a vote to award a P3 for the development of a new sewer system. On the other hand, the Fargo Moorhead water diversion P3 that has been on hold since 2017 was revived this year.
The P3 outlook for 2020 is bright. With each success or failure, lessons are learned, and the process and model is continuously being improved.