Tuesday, October 31, 2006

Price of PPP may be too high

For me, the most interesting session at the ICCA Congress today in Rhodes was an afternoon panel led by the leading venue architect Larry Ottmanns of Leo Daly. He has been involved in Phase 2 of the Hong Kong Convention & Exhibition Centre and is closely involved in the 5,000 seat convention centre extension in Melbourne. He was joined by Leigh Harry from Melbourne, Peter Brokenshire from Kuala Lumpur and Steve Piper from Brighton.
Public Private Partnerships are flavour of the month among government developers of infrastructure. But, for me at least, the unexpected general conclusion of the session was the price may be too high to pay. The panelists spoke of compromised designs and, in some cases, build standards and of what Ottmans described as the mismatch in the objectives of P1 and P2 in the PPP equation.
Unless the provision to goverment of a convention centre is regarded as "stamp duty" on a larger property project, as it was described by one delegate representing a new mega investment in Hyderbad, India funded by Dubai, then it was hard to find any example of where the private sector has been willing or able to put up more than 15% of the project value. In those cases, we all wondered whether the price of compromise was worth the 15%.

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