Retail investors offered public-private partnership opportunity

A school or the proposed Wiri prison could be the first potential investments for a fund launched to retail investors this week.

The New Zealand Social Infrastructure fund is the first chance individuals have had to enter into public-private partnerships through building public assets that will be leased by the government.

New Zealand's largest broker, Craigs Investment Partners, hopes to raise $125 million for the fund which will then invest the money into a wider pool to be managed by infrastructure investors Morrison & Co.

The Morrison & Co Public Infrastructure Partners (PIP) fund has the support of the New Zealand Superannuation fund which has committed $100 million to it.

Peter Coman, managing director of the PIP fund, said he hoped the fund would be a catalyst to accelerate the development of social infrastructure as well as provide an alternative option for investors.

"Social infrastructure PPPs are a proven model internationally.

"Having high-quality private investors focused on providing facilities mean that government agencies can focus on delivering social services."

The Government has yet to announce any public private partnerships but Coman said there were signs that it was considering them.

In March 2009 the Government set up a national infrastructure unit and last year it released guidelines on PPPs.

Finance Minister Bill English also told media last month the Government was looking into PPPs both in the education area and for a proposed prison at Wiri and said the Government hoped to make a decision by June.

Even if the PPPs are announced the new fund will not automatically be guaranteed of getting the project.

The projects are likely to be open for tender and at least one Australian company has said it would be interested in public buildings here.

Coman said it was aware of the competitive nature of the industry but believed it had as good a chance as any of winning a tender.

The fund also has the ability to invest in Australian PPPs if it does not win contracts in New Zealand or if there are too few here. The capital raising closes on April 30.