Make “Partnership” Your Priority

In Public-Private Partnership, the operative word is “Partnership”. After Procurement, the Developer becomes the University’s partner for the duration of the contract, often 30 to 40 years. The longevity of the University / Developer relationship underscores the need for a partnership mentality that should start during the development of the P3 Business Case and extend to all entities that will inform the project’s success. Key partnership entities besides the Developer include the Technical Advisors, University Stakeholders, and the O&M Partner.

“The most important P in P3 is Partnership. The process, from project inception to handover of the asset after the concession period, must focus on amicable problem-solving, given the anticipated multi-year relationship among the parties. This is a mindset shift for many but, when correctly implemented, provides a strong relationship baseline which will be the foundation to support the many challenges throughout the project’s life cycle.” — Paul Mackintosh, WT Partnership

Technical Advisors: Business Case, PRocurement, Design and Construction

The Technical Requirements (TR’s) represent a complex contractual document that outlines all physical and performance requirements for the project. They are usually written in advance of the Design phase with leadership from the University and input from the Technical Advisors—the financial, legal, design, engineering, and construction experts who the University hires to help create the Business Case and procurement documents. Partnering with the right Technical Advisors helps the University assess project viability, while creating a set of contract documents that Development Teams can translate into viable bids and campus assets that deliver on social, environmental, and economic performance goals. The Technical Advisors remain involved in the design compliance reviews through the design of the facilities and creation of the Construction Documents.

Development Team: Procurement, Construction, O&M

Attracting the right Development Teams to the P3 opportunity is key. University leaders should consider partnership with respect to market and financial conditions, how potential Developer partners will perceive the opportunity and the prospect of engaging in a long-term contract with the University. 

Evaluation metrics for selecting the most appropriate team should be well-developed and clearly articulated relative to social, environmental and economic performance objectives and goals in advance of the Procurement phase. Evaluation metrics may include minimum parameters of the Development Teams’ financials, experience, and sustainability achievements, which factor into the evaluation in a balanced way alongside the price proposals. In other words, the lowest bidder may not be the most qualified long-term partner relative to social and performance goals, and their qualifications should be well vetted in advance of bidding to help avoid unwanted surprises down the line.

“Ensure you invest the time in selecting your development partner, because you're going to be in the foxhole with them. And when you're in that foxhole and you've got 15 pages of decisions to make in three weeks, you need people that you can trust, that you can rely on, and that value the partnership as much as you do.” —Traci Ferdolage, San Jose State University (Formerly University of California, Santa Cruz) 

During procurement, it’s important to keep in mind that the form and tone of the contract are essential to its implementation; if the legalistic nature or complexity of the contract undermines the partnership element, it may undermine the overall project. A complicated legal and contractual process for resolution of design issues adds pressure to the design process and schedule. If the change management process is so complex that it takes months to execute, the drawings will likely not be current, errors in the field will be more likely, and the Stakeholders will be more anxious.

Approach contract development, negotiations, and the overall P3 process with a “one-team,” partnership mentality.

Campus Stakeholders: All Phases

Most universities are relatively new to P3. University leaders and Development Teams who are responsible for delivering the P3 project are encouraged to forge partnerships with key campus Stakeholders across functions to gain buy-in for the process and help shepherd the project from procurement through occupancy, as detailed in the next section. Identifying and empowering a Stakeholder Manager is highly recommended. This person should be responsible for liaising with a diverse group of representatives, including: Business Affairs, Campus Architecture, Communications, Community Stakeholders, Construction Management, External Stakeholders, Facilities Management, Facilities Planning, Financial Services, Housing / Dining Services, Economic Development, Procurement, Public Research, Public Safety, Space Management, Student Affairs, Student Success, Sustainability, Transportation / Parking Services, and Private Partners / Donors.