21 Nov 2016
Plenary Properties Long Beach LLC (PPLB), a Plenary-led consortium, is pleased to announce it has achieved financial close for the USD$520 million Long Beach Civic Center Project.
Plenary is the lead developer, sole equity provider and financial arranger for PPLB, which reached financial close today with the City of Long Beach and the Port of Long Beach. Other consortium members include Clark Construction, Edgemoor, Johnson Controls and Skidmore, Owings & Merrill.
The Project is a public-private partnership to develop, design, build and finance a new Civic Center, with a 40-year operations and maintenance contract.
“We are excited to see this deal move forward and to meet the goals set by the City three years ago when it embarked on the Civic Center P3 procurement,” said Mayor Robert Garcia. “I’d like to congratulate and thank our City Council, City staff, our partners, and the Plenary led consortium that helped us to reach this important milestone.”
“Our success in achieving financial close is the product of the strong leadership of the City and the Port of Long Beach and the incredible dedication of the entire team,” said Dale Bonner, Plenary Concessions Executive Chairman.
“Reaching this milestone reflects the mutual dedication and determination of the City and Port of Long Beach and Plenary’s consortium partners to keep this important project on track,” said Stuart Marks, Long Beach Civic Center Project Director and Plenary Senior Vice President.
The Project is the first social infrastructure project in the U.S. to be financed using a taxable private placement solution. Plenary had initially proposed using tax-exempt lease revenue bonds to finance the Project but moved to the private placement solution because it offered lower financing costs and better risk allocation for the City of Long Beach. Plenary also raised short-term construction financing to fund the design and construction of a new Port headquarters building.
The Project is also the first hybrid design-build-finance-operate-maintain (DBFOM) deal in North America, combining both public infrastructure and private development components within a single project. This hybrid approach enabled the City to achieve its affordability targets and also allowed the Plenary-led consortium to deliver a vibrant masterplan combining, civil, commercial and residential elements in a cohesive manner which will revitalize the entire downtown area.
“The P3 method was selected because it enabled the City to procure a new Civic Center without any bond issues, tax measures or voter approvals, and included over 100 outreach sessions,” noted Michael Conway, Director of Economic and Property Development. “This method also facilitated design and operational innovation from the P3 developers; provided a high level of 40-year life cycle maintenance for the new Civic Center; and integrated significantly increased private real estate development of the downtown area through the City’s contribution of land.”
The Project includes the creation of a new City Hall, a new Main Library, a revitalized Lincoln Park, parking facilities, and a new headquarters for the Port of Long Beach, as well as complimentary private development in downtown Long Beach. By utilizing a public-private partnership model, the City of Long Beach is able to achieve this redeveloped Civic Center without costing more than it currently pays to use and maintain existing facilities, adjusted annually for inflation.
PPLB’s proposal includes a number of innovative and sustainability minded features. The New Main Library is based on sustainable design and state-of-the art programming and interior planning. The new library will be relocated to the northern end of the revitalized Lincoln Park with dual entries to engage park users and the surrounding neighborhoods to the north. A revitalized Lincoln Park has been designed with walkways, lighting and landscaping to create multiple activity zones and improved amenability and public safety.
The City Hall and Port headquarters are designed as separate and distinct buildings to meet their respective programming and security requirements, as well as to create a modern and efficient workplace environment. The separate buildings have shared facilities and both open to the new Civic Plaza. The new City Hall, Port headquarters and Main Library are each designed to achieve a LEED Gold rating.
With financial close now achieved, design development and permitting will continue until construction begins at the end of June, 2016. The Project is scheduled to complete the new City Hall Building, new Main Library and new Port headquarters building in June 2019.
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