GAMA Holding A. Ş., Türkerler İnşaat and GE consortium develop new hospital complex
The European Bank for Reconstruction and Development (EBRD), Export Development Canada (EDC) and the Overseas Private Investment Corporation (OPIC), the US government’s development finance institution, are co-financing the development of a €375.75 million high-tech hospital in the north-western Turkish province of Kocaeli.
The Kocaeli hospital will be designed, built, equipped and managed by the private developer Kocaeli Hastane Yatırım ve Sağlık Hizmetleri A.Ş, a joint venture between global industrial company GE and Turkish corporations GAMA Holding A.Ş. and Türkerler İnşaat.
Faced with the need for large investments, the Turkish government is seeking to engage private sector resources and know-how to construct and manage infrastructure facilities more quickly and efficiently.
The new health complex will span several buildings and have a total of 1,180 beds, providing better hospital facilities for the province. Under a 28-year concession, the buildings will be leased to Turkey’s Ministry of Health. The private developer will act as facilities manager, providing building maintenance and non-clinical services, while medical services will remain the remit of the Ministry of Health. The hospital is expected to become operational in 2019.
As part of the financing package, the EBRD has arranged a €62.7 million syndicated loan under its A/B loan structure, with €20 million for the Bank’s own account and €42.7 million syndicated to UniCredit S.p.A., Industrial and Commercial Bank of China Ltd Dubai Branch, and Intesa Sanpaolo S.p.A. OPIC of the United States and EDC of Canada are providing parallel financing of US$ 220 million and €55 million, respectively.
Last month, Turkish President Recep Tayyip Erdoğan hailed the comprehensive long-term financing for Kocaeli and Izmir hospital public-private partnership projects involving the same group of lenders. President Erdoğan said the programme to build or expand hospitals is an outstanding example of cooperation between private and public sectors.
The EBRD has financed five hospital projects under the programme and has also been working closely with the Turkish Ministry of Health over the past four years to enable greater private sector involvement in the hospital sector.
The EBRD started investing in Turkey in 2009 and currently operates from offices in Istanbul, Ankara and Gaziantep. To date it has invested over €8 billion in the country through more than 200 projects in infrastructure, energy, agribusiness, industry and finance. It has also mobilised nearly €20 billion for these ventures from other sources of financing. Some 98 per cent of the Bank’s investments in Turkey are in the private sector.