The Government Accountability Office defines a public-private partnership (PPP or P3) as “a contractual arrangement that is formed between public and private-sector partners”. These arrangements typically involve a government agency contracting with a private partner to renovate, construct, operate, maintain, and/or manage a facility or system, in whole or in part, that provides a public service. Under these arrangements, the agency has the option to sell or retain ownership of the public facility or system. The private party generally invests its own capital to design and develop the properties. Typically, each partner shares the income resulting from the partnership.
At KEITH, we expect a rise in P3 Development projects as more and more local governments become familiar with and experience the benefits of such projects. In addition, we see these projects allowing government agencies the ability to backfill public realm development, as historical Community Redevelopment Areas continue to sunset.
In a P3, the public agency would have the ability to enter a long-term lease or sale with a developer, who is then responsible to design and build the project at their expense and in exchange for profitable real estate rights, such as a ground lease or even market rate development. These arrangements can allow the agency to utilize their assets, likely in real estate, as leverage and allow a developer to bring funding to develop a project. This “partnership” can be mutually beneficial, allowing for critical public infrastructure to be provided without incurring additional tax or debt to the agency.
KEITH is currently involved in dozens of these projects across Florida and is most recently working with the City of Fort Lauderdale on the International Swimming Hall of Fame and the Treasure Coast International Airport and it’s exciting to see both of these public assets advanced.
If you are interested in learning more about how KEITH can assist your agency or are interested in a partnership with KEITH, please let us know. In any partnership, picking the right team can be the difference between winning and losing and we have the experience and relationships to assist.