July 23 2020
Remobilizing Our Cities: A Look at the P3 Model
Recently the Government of Ontario released its Spring 2020 Market Update, which indicates that Ontario will move forward with 37 major infrastructure projects across the province using the P3 model. In British Columbia, similarly, P3 projects are underway. And Canada isn’t alone. Across the UK and US, the AEC industry is looking for stimulus in the wake of COVID-19 and P3 projects can be part of the solution.
With the global downturn caused by the pandemic, it is heartening to see governments committing to funding for such projects. Investments like these will go a long way to underpinning an economic recovery in the months and years to come by creating jobs and delivering projects that will help improve the quality of life for the people and communities where these developments take place.
Below, we take a dive into the P3 model and the values that make them a success.
A Model Suited for Large Infrastructure Projects
P3 projects refer to public-private partnerships between the government and private sector to deliver large, complex public infrastructure projects in an integrated approach. P3s can be used to build roads, bridges, hospitals, schools, transit, and more, often avoiding budget and cost overruns typically seen in government-only projects.
Typically, the government or public entity leading the P3 will establish the scope and guidelines of the project, then bring on design and construction teams to compete for the opportunity to design, deliver, and in many cases, maintain them. Since these large infrastructure projects can be prohibitively expensive to deliver, the selected private sector consortium finances the project and the leading government entity pays over a pre-determined number of years.
The primary benefit of the P3 model is that budgets and timelines are locked in. Because the private sector finances the project, taxpayers are protected from cost overruns, since the amount the government pays to the private sector is fixed in advance. Other benefits of the model include deep collaboration and creativity during project delivery.
Partnership Is the Winning P
P3 projects are deeply collaborative. Once the government has established the scope of a project, it’s up to the chosen private sector consortium to deliver it. These consortia typically comprise architects, developers, financing groups, engineers, contractors, and numerous other subconsultants who must all work together to stay within the budget and schedule originally presented to the client or government authority.
We find that collaboration is most effective when teammates complement, rather than replicate, one another’s abilities. With consortia teams focused on managing risk by assembling the most capable partners to carry out these complex projects, the P3 model is no exception.
To deliver the Mackenzie Vaughan Hospital, the first net new hospital to be built in Ontario in more than 30 years, Entuitive’s structural engineering expertise is complementing PCL Construction’s design-build team.
Now known as the Cortellucci Vaughan Hospital, the 1.2 million ft² facility will feature fully integrated smart technology systems and medical devices that can speak directly to one another to maximize information exchange and enable improved patient care.
“The Cortellucci Vaughan Hospital is a tremendous demonstration of large project collaboration,” says Sean Smith, Principal at Entuitive. “From the early days of the RFQ process, through the RFP pursuit and into design and construction, the whole team was present and engaged in driving toward a successful project. Big projects have big teams, but strong communication, effective meetings, strong direction and leadership, and a widely shared focus on project success all led to a great team experience and successful project outcomes.”
Outcome-Based: A Natural Fit for Entuitive
Not only does this model require extensive collaboration and teamwork to stay on schedule and on budget, but P3 projects also enable intense creativity on truly transformational infrastructure. On projects where design and materials are less prescriptive, creativity and innovation flourish.
“P3 projects are often performance-driven,” says Michael Meschino, Principal at Entuitive. “The proposed infrastructure must tangibly serve the needs of the community, whether it’s transit that runs through the heart of a city, or a school that must offer the highest quality educational facilities. Our holistic approach to design allows us to see the big picture as well as the nuts and bolts of a project, enabling innovative creativity.”
One example of this type of creative thinking is seen in our work on the Eglinton Crosstown light rail transit P3 project in Toronto, which challenged our team to deliver the structural designs for three underground transit stations. We examined how the underground structures would interact with the surrounding soil, which had not previously been considered by the transit authority. Taking the soil stiffness into consideration, our team delivered station designs that featured reduced structural thickness and reinforcement requirements than previously anticipated, resulting in steep savings overall.
Entuitive’s expertise in performance-based engineering, underpinned by our in-house computational design and parametric modelling tools, allows us to go beyond building codes to deliver uncompromising performance. We take data one step further than most by creating a seamless connection between building information modelling, parametric modelling, and analysis tools in our own in-house framework that allows us to quickly study and compare options and create efficiencies.
Critics may argue that the P3 procurement model offloads too much risk to the private sector. This can be the case, and not all projects are suited to this model. However, our team’s experience allows us to overcome many of the challenges P3’s face. For example, we’ve assisted both contractors and owners with fixed-price bids and the development of performance requirements. This holistic experience enables our P3 success.
Our internal mantra is, “How can we be better tomorrow than we were today?” and this commitment is reflected in our willingness to optimize by constantly looking for opportunities to improve and work with our partners to find the best answer.
We love being involved in P3 projects because they are truly transformational, creating cities and communities with smarter and more sustainable infrastructure, while necessitating the creativity and collaboration our team thrives on.
Entuitive has completed several P3 projects, with more underway, including:
- Bayers Lake Community Outpatient Centre, Nova Scotia
- Eglinton Crosstown LRT, Ontario
- Humber College Learning Resource Commons, Ontario
- Mackenzie Vaughan Hospital, Ontario (now the Cortellucci Vaughan Hospital)
- Peel Memorial Centre for Integrated Health and Wellness, Ontario
- Royal Columbian Hospital, British Columbia
- Royal Inland Hospital Patient Care Tower, British Columbia
- Saskatchewan Hospital North Battleford, Saskatchewan
- Seneca College Magna Hall, Ontario
- St. Paul’s Hospital, British Columbia
- West Park Healthcare Centre, Ontario