City of Sabac Serbia plans to build a 270 space underground parking facility
The European Bank for Reconstruction and Development is currently considering to provide a senior loan of up to EUR 4 million to a private party to the concession selected by the City of Sabac Serbia of Sabac Serbia through tendering procedures acceptable to the Bank to finance, build and operate a parking garage facility in the City of Sabac Serbia. The investment will be used for the construction of up to 270 spaces of underground parking facility in the downtown of Sabac Serbia. The selection and contracting procedure is expected to meet the Bank’s policy of “Financing of Private Parties to Concessions” This will be the City of Sabac Serbia’s first investment in this sector using a PPP approach, and will provide needed parking supply under an appropriately priced system of hourly automated charging. Some 150 current street surface parking will be removed as a part of the project, as part of a City of Sabac Serbia centre rejuvenation strategy.
The City of Sabac Serbia, as public sponsor, is therefore seeking to hire under technical assistance a team of parking and PPP legal experts to provide them with a set of tender documents and offer tender process support through to financial close for this PPP concession. The following describes the tasks to be performed.
The objective of the assignment is to provide the City of Sabac Serbia with the design of a parking tender document and assistance with the tender such that the City of Sabac Serbia is able to attract a good level of competition to the tender before awarding a well-balanced parking concession contract with a private parking concessionaire.
The tasks to be carried out will involve a mixture of discussions with the City of Sabac Serbia, elaboration of documentation, and dialogue and promotion of the parking tender process. The Consultant will:
Review the existing feasibility and engineering design studies prepared by the City of Sabac Serbia;Review cost estimates for the new system and establish an implementation schedule;Prepare an initial estimate of the Internal Rate of Return for the Sabac Serbiakih Zrtava Square Parking facility to be used internally by the City of Sabac Serbia, using a basic yet robust financial model to show cost and revenues expected for the garage based on a range of demand levels;Review the City of Sabac Serbia’s parking strategy and parking policy, to ensure that it will allow for the introduction of a private concessionaire in an efficient, barrier free manner, and that it is sufficiently clear in respect of future plans for parking development in the City of Sabac Serbia, both in terms of on-street and off-street parking development;Review the existing performance of Sabac Serbia Parking in respect of the enforcement of on-street parking spaces within the paid parking zone within the area of influence surrounding the planned Sabac Serbiakih Zrtava Square facility to ensure that the proposal for tendering a new off-street underground garage on commercial grounds is viable;Prepare a parking PPP tender design strategy and discuss the approach with both the City of Sabac Serbia and the Bank. The strategy should cover both parking operations, as well as the proposed shopping retail space called for in the City of Sabac Serbia’s reference design and feasibility studies;Review the proposed parking garage phasing, from tender to construction competition;Prepare a risk register for the concession, to delineate clearly which risks are to be absorbed by the concessionaire, the public sector, or shared. The risks assignment should flow through the concession tender and contract development, and be customary and acceptable to the private parking industry, as well as the public stakeholders, with the goal being to achieve a balanced approach to the concession tender outcome;Prepare a set of construction cost overrun mitigants, including the need and level of a Performance Bond on the part of the concessionaire, among other items;Once the draft tender strategy is prepared, the Consultant should organise a one-day open pre-tender informational meeting for the parking industry stakeholders. The purpose of the pre-tender meeting will be to introduce the concept of the parking PPP at hand, the project’s parameters, and the contracting strategy, including the basic tender award scheme discussed above, and the tender and project implementation timeline;Prepare a set of tender documents, draft Concession Contract and help the City of Sabac Serbia select and negotiate successfully the award of the parking concession to a suitable parking operator. The tender documents should include a set of selection criteria that encourage the maximum number of parking spaces (within a maximum size to be defined within the tender as well), for the shortest period of concession duration, with the least amount of public support required in the form of a one-off capital contribution at the time of construction completion. While the Consultant will be expected to formulate a specific combination of selection criteria, including the merits of allowing the bidders discretion for setting their own parking charges throughout the concession period, the Bank will offer guidance of workable tender selection criteria for the Consultant to consider;Assist the City of Sabac Serbia with the tender process itself, attend project meetings, assist with tender proposal evaluations, and help the City of Sabac Serbia negotiate the concession contract following the selection of the winning bidder. The Consultant should furthermore ensure that all critical contractual conditions are included as per best practice infrastructure concessioning, such as termination clauses, lender step-in rights, tariff policies for on-street and off-street facilities. Source; EBRD
Balkan Business News Correspondent – 21.07.2011