Shirley Boys' High School and Avonside Girls' High School, Christchurch - two of the 11 schools in the deal. Photo / Supplied
Shirley Boys' High School and Avonside Girls' High School, Christchurch - two of the 11 schools in the deal. Photo / Supplied
A Crown agency has approved a $205 million deal for British interests to buy service contracts for the country’s only maximum security prison, 11 state schools and a North Shore university student accommodation campus.
Toitū Te Whenua Land Information New Zealand said yesterday clearance had been granted for British-controlled IPP(NZ) to buy public-private partnership contracts on all 13 government-owned sites.
London Stock Exchange-listed International Public Partnerships owns that entity, its shares trading around £139 (NZ$297.45) and with a market capitalisation of around £2.6 billion.
Locally-owned global infrastructure investor Morrison & Co is selling the contracts via a number of public-private partnership funds.
The British firm will now be in charge of funding services to Auckland Prison at Paremoremo, five Auckland schools, one in Hamilton, four in Christchurch, one in Queenstown as well as AUT’s North Campus student accommodation on the North Shore.
Hobsonville Point Primary School, Hobsonville Point Secondary School, Ormiston Junior College, Te Uho o te Nikau at Flat Bush, north-west Auckland’s Matua Ngaru Primary School, Hamilton’s Te Ao Marama School, Christchurch’s Shirley Boys’ High School and adjoining Avonside Girls’ High School, its Haeata Community Campus, Rolleston College and Queenstown’s Wakatipu High School are the 11 education assets involved.
Wakatipu High School in Queenstown. Photo / Supplied
It’s not the land or buildings being sold but rather service provision funding, so the British entity will take over running aspects like cleaning, maintenance and building management, contracted to the Government to provide those services under the public-private partnership model.
In turn, that British business will then contract out those services to third-party local providers.
Morrison & Co’s PPP assets being sold are Public Infrastructure Partners LP, PIP II Pooling LP, Public Infrastructure Partners III LP, Public Infrastructure Partners SE LP and Public Infrastructure Partners II LP.
Three public-private partnership projects with the Crown are involved via the Ministry of Education. That is for the financing, design, construction, maintenance and operational services at all 11 schools.
A PPP project with the Crown, via the Department of Corrections, for services at Auckland Prison, also known as Paremoremo Prison, is involved.
New Zealand's maximum-security prison at Paremoremo. Photo / Michael Craig
The British will also take over providing services for Akoranga Student Village at AUT on the North Shore.
In December last year, Morrisons described the scope of the deal.
“Morrison & Co has agreed binding terms to sell five New Zealand infrastructure assets to Amber Infrastructure Group for approximately $200 million (£105 million). Under the agreement, the five assets from Morrison & Co’s Public Infrastructure Partners portfolio will be 100 per cent owned by the Amber-advised, London-listed investment company, International Public Partnerships Limited,” Morrison said on December 9.
The Hobsonville Point primary and secondary schools were Morrison & Co’s first investment in its Public Private Partnership portfolio.
“Under its management, the schools have increased student capacity by almost 50 per cent. With a 5-NZ Green Star Built star rated establishment and a five-star rating under the GRESB Infrastructure Asset Assessment, the schools were recently refinanced using sustainability loans, endorsed by independent accreditation.
“The five infrastructure assets join Amber’s growing Australian investment portfolio which now totals assets worth more than $9b across the public, healthcare, transport, energy and digital sectors,” Morrison’s December statement said.
A second campus at Rolleston College isn't enough to cater for expected roll growth. Photo / Supplied
This week’s LINZ decision release, ruled on in late April, cited the reason for clearing the British to go ahead with the deals. It also referred to the expansion of Rolleston College in the expanding Christchurch area on the southern outskirts.
That school already has a roll of nearly 1500 and is Rolleston’s only secondary school, described as a future-focused co-educational state high school. It is one of the South Island’s largest and has the potential for big expansion to meet the growing population in the area.
“The main benefits to New Zealand are economic benefits as the investment is likely to result in enabling the PPP market to operate preventing stranded assets, developing the Rolleston College, and having [funding] for future school expansion projects and possibly other PPP projects,” LINZ said.
“It is also likely to result in the promotion of government policy to address infrastructure deficit and of the Government’s PPP strategy,” the LINZ decision said.
Russell McVeagh acted for International Public Partnerships, with Lance Jones’ name on the LINZ public decision sheet.
The Sydney office of London-headquartered Amber Infrastructure Group is the Australasian adviser and manager to IPP in this part of the world.
Vaughan Wallace, head of Asia Pacific for Amber, told the Herald today that the business would employ a team of people to manage the contracts, including some from Morrison.
“The key point I want to make is that very little will change. The same service providers will continue on all 13 assets. We’re employing people in Auckland right now,” Wallace said from Sydney.
The sale has not yet concluded because it is subject to further terms and conditions.
“We’re keen to invest in other assets in New Zealand. This is the start of what will be a long relationship in New Zealand for us to invest alongside the Government. We’ve set up an office in Generator at Britomart,” Wallace said.
The prison, school and university deals were the first Amber had advised on in this country but Wallace expects further involvement via other asset purchases.
