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Morrison-led team wins $140m New Zealand schools PPP

The fund manager is investing through its second social infrastructure vehicle, which reached a final close on $84m last November.

A consortium led by New Zealand-based Morrison & Co has been selected as the preferred bidder to deliver five new schools under a PPP contract worth of more than NZ$200 million ($140 million; €132 million). 

The consortium will finance, design and build new primary schools at Kumeu and Flat Bush in Auckland as well as at Sylvester in Hamilton. It will also rebuild Shirley Boys’ and Avonside Girls’ High Schools on a new site in Christchurch. The team will maintain the facilities for 25 years after the schools open in 2019. 

Morrison’s Public Infrastructure Partners Fund II and CIMIC Group’s project finance arm Pacific Partnerships are providing financing for the project, while another CIMIC subsidiary, CPB Contractors, will be in charge of its design and construction in joint venture with Christchurch-based company Southbase Construction. 

The NZ$120 million PIP Fund II, which reached its final close last November, was supported by a group of domestic investors including the Government Superannuation Fund Authority, Proctor told Infrastructure Investor. He explained that the fund size was increased to NZ$120 million from NZ$100 million in response to investor demand and solid deal flow. 

The vehicle, focused on New Zealand’s social infrastructure market, is already half deployed. It is now looking to invest in social housing and prison PPPs, Proctor said. 

Revenue from its latest schools project will be finalised at contract execution, which is expected in the coming months, according to CIMIC. The agreement will also contain an expansion mechanism under which the Ministry of Education has the right to add further schools to the project with an aggregate capital value of NZ$200 million, CIMIC said.

The package is the third schools PPP to be awarded in New Zealand, which were all won by consortia involving Morrison. The firm led another team called Future Schools Partners, which clinched the previous two schools PPPs in 2011 and 2015 respectively. 

Earlier this year, the group delivered the Haeata Community Campus in Aranui, the Rolleston College in greater Christchurch and the Ormiston Junior College in Auckland. The fourth school, Wakatipu High School in Queenstown, is on track to be delivered at the beginning of next year, according to Morrison. 

Steven Proctor, executive director of PIP Fund II, said that working on the first two schools PPPs has allowed the firm to cement its relationship with the Ministry of Education.