NZ Super-CDPQ Infra shortlisted for Auckland light rail

The NZ Infra joint venture will go head-to-head with government entity NZ Transport Agency for the right to act as delivery partner for the multibillion-dollar scheme.

The New Zealand Government has shortlisted two bidders in the race to be named delivery partner for the Auckland light rail project.

NZ Infra, a joint venture between the NZ Super Fund and CDPQ Infra, a wholly owned subsidiary of Canadian pension Caisse de dépôt et placement du Québec, has been shortlisted after it submitted an unsolicited bid to develop the scheme in May 2018.

The other shortlisted organisation is the NZ Transport Agency, a Crown entity that administers the country’s state highway network and provides other input into transportation systems.

A final decision on who will build the light rail project will be made in early 2020 with the assessment process set to take up to six months.

NZ Infra’s proposal would be a first for New Zealand, with the consortium co-designing the asset with the government and its partners while taking on most of the financing burden and risk.

The Auckland light rail project will consist of two lines, one linking the city centre to Auckland Airport and the other linking the city centre to Waimauku to the north-west. The New Zealand government recently announced a 10-year transport plan for Auckland that earmarked NZ$1.8 billion ($1.2 billion; €1.1 billion) in seed funding for the scheme, with the option of securing further private investment in the network.

In a statement, minister of transport Phil Twyford said that the light rail project would be a “magnet for private investment in urban renewal” and that the government required time to examine the two delivery partner proposals in detail.

“What NZ Infra is proposing has never been considered before in New Zealand, based on a public-[private] investment model,” he said.

“There are significant differences in how the two options would be financed and delivered. The NZTA is exploring a range of procurement, financing and delivery models, including alliances and public-private partnerships, and will continue to develop these.

“Both of these options for delivering light rail are credible, but neither are fully developed, and we need to understand the long-term implications. That step is critical for the government if we are to make the right decision on how best to deliver light rail for Auckland.”

Twyford also said that construction would not begin in 2020 due to the new procurement timeline.

NZ Super told Infrastructure Investor in May 2018 that the fund would consider adding other partners to its consortium. Then-acting CEO Matt Whineray said in a statement: “We wish to explore whether a NZ Super Fund-led consortium leveraging our international relationships can fund and deliver the project, on a fully commercial basis.”

A spokesman for NZ Super said today that it and CDPQ Infra were working on the project “on an exclusive basis” but declined to comment further.

NZ Infra said that it could not comment due to commercial reasons.