Bilkent Laboratory PPP

Location:

Turkey

Project number:

48799

Business sector:

Municipal and environmental infrastructure

Notice type:

Private

Environmental category:

B

Target board date:

18 Jul 2017

Status:

Cancelled

PSD disclosed:

30 Mar 2017

Translated version of this PSD: Turkish

Project Description

Financing of the infrastructure of an integrated laboratories campus consisting of various administration buildings and different laboratories including different levels of BSL and ABSL laboratories, a public private project (PPP), in the province of Ankara, Turkey pursuant to an 18 years concession awarded by Turkey's Ministry of Health. The project will include the design, construction, equipment and maintenance of the facilities for the provision of products and services for Turkish Public Health Institution (TPHA) and Turkish Medicine and Medical Equipment Institution (TPMDA).

Under this PPP structure, the Concessionaire will supply and maintain the research laboratories, while the provision of the research services within the laboratories will remain the responsibility of the Ministry of Health. Total Project Costs are estimated at ca. EUR 710.5 million.

Project Objectives

The EBRD will assist in increasing private sector participation in the healthcare sector in Turkey. In response to the need for large capacity investments in healthcare systems, the Turkish government is seeking to tap private sector resources and know-how to construct and manage infrastructure related facilities more rapidly and more efficiently, while preventive healthcare provision remains under the responsibility of the state. The Project involves design, construction and equipment of presently existed TPHA and TPMDA buildings into a modern, functional and integrated campus form and provide services considering the work flows and by this create effective and efficient services.

The Project is the first of its kind in the Turkish healthcare market supporting research activities and providing access to high tech laboratories to respond the modern days development technologies, changing environmental conditions, healthcare needs and health risks and treats for the Turkish healthcare system.

Transition Impact

The Project's transition impact stems from the following key areas:

1. Demonstration effect of new ways of financing, procuring and operating healthcare facility: The projects under the Programme are structured on a Design-Build-Finance- Lease-Transfer (DBFLT) basis with strong demonstration effects for the rest of Turkey and other countries in the region, by promoting the use of PPP contracting, and demonstrating good practice in international PPP standards.

2. Setting new business standards: The project is expected to achieve high standards of business conduct by constructing a modern laboratory infrastructure based on international standards and monitoring quality.

3. Demonstration effect of new ways of financing by promoting the participation of untapped investor classes in the Programme: The EBRD involvement is focused on supporting the entry of untapped investor classes into the financing of the on-going hospital PPP programme in Turkey (which to date has largely been dominated by Turkish investors, IFIs and commercial banks). The Project demonstrates new ways of financing by promoting the participation of untapped investor classes and attracting new Islamic commercial funding sources alongside the participation from the Islamic Development Bank (IDB).

Client Information

CCN LABORATUAR HIZMETLERI VE YONETIM A.S.

The client is CCN Laboratuar Hizmetleri ve Yonetim A.S., a special purpose company incorporated in Turkey and owned by CCN Yatirim Holding A.S.

CCN Yatirim Holding A.S. established to operate in construction, real estate, tourism and education sectors in addition to investment and operation of Healthcare PPP Projects. Company is one of the biggest players in Healthcare PPP with 5000 beds capacity in Turkish healthcare sector. The client is responsible for designing, building, financing and operating the Bilkent Laboratory PPP, whilst MoH will remain responsible for the provision of research services within the laboratories.

EBRD Finance Summary

EUR 75,000,000.00

The EBRD is planning to arrange an A/B loan of up to EUR 124.5 million (up to EUR 75 million Aloan and up to EUR 49.5 million B-loan). The EBRD financing will be in parallel with facilities from other international financing institutions and commercial banks.

Total Project Cost

EUR 710,500,000.00

The total project cost is estimated at circa EUR 710.5 million which comprises up to EUR 124.5 million EBRD A/B loan as well as financing from other commercial banks and IFIs and the sponsors' equity commitments under 70:30 debt-to-equity structure.

Environmental and Social Summary

Categorised B (2014 ESP). The construction and operation of an integrated laboratory campus will have limited site specific Environmental and Social ("E&S") impacts which can be readily assessed and mitigated through good management practices and targeted E&S actions.

Environmental and Social Due Diligence ("ESDD") was carried out by the Project Company's appointed consultants and reviewed by the LTA. Although not required under the Turkish EIA Regulation, an Environmental and Social Impact Assessment ("ESIA") study has been prepared for the project upon Sponsor's request. The ESIA study has not yet identified any significant E&S impacts. The project design has not yet been finalised however, significant changes in the design are not expected. The ESDD also includes the development of a non-technical summary document which will be disclosed together with a project summary document.
The Project will be developed on state owned land and no resettlement, land acquisition and / or economic displacement will take place. The Project site is located towards the south of the North Anatolian fault and a geotechnical study has been carried out on the Project site area and has identified that the Project site is located in a 4th degree seismic zone (1st degree being the most and 5th degree being the least risky). The Project will be designed, constructed and operated in accordance with Turkish standards and regulations for protection against seismic activity. In addition the BSL 4 section will also be protected by the installation of seismic isolators for enhanced protection.Biological risks during laboratory work will be controlled by implementing best practice, specific national codes and international recognised standards for handling, storage, transporting and disposal of biological agents. An independent expert will provide technical and organisational guidance to the client on the BSL and ABSL design which intends to meet EU requirements. The layout of facilities will be designed with a phased security approach which will establish restricted access control to buildings and laboratories. High containment areas such as ABSL-3, BSL-3 and BSL-4 will be designated with the highest level of security. The ABSL-3 laboratory will use animals for scientific purposes with approach and requirements comparable to laboratories within the EU28.

These activities will be under the direct control and responsibility of the MoH and not the Project Company. The laws in Turkey related to animal use for scientific purpose generally aligns with the relevant EU Directives which include the minimisation of animal testing by adopting the 'three Rs' approach (Replace, Reduce, Refine) and strict control measures on animal welfare. During the construction phase of the Project the EPC Contractor will be required to develop and implement an Environmental, Health and Safety management system to manage risks and impacts.

The management systems will align with international standards namely ISO 14001 (Environment) and OHSAS 18001 (Occupational Health and Safety). The client intends to manage all worker accommodation during the construction phase of the project and site accommodation will follow EBRD / IFC guidance note on workers accommodation. A construction traffic management plan has been prepared for the Project and will be implemented by the contractor to ensure safe management
of all internal / external traffic movements and minimise risks of potential disturbance during the construction phase.

An independent traffic assessment has been carried out for the facility to assess the impact during the operational phase. It is expected that 3,900 people, which includes staff, service personnel and visitors, will use the roads entering and leaving the project site during the operational phase and therefore further development in the road traffic design will be made to mitigate the risks to pedestrians and other road users.

A project specific Environmental and Social Action Plan ("ESAP") will be developed and be implemented by the client and includes, inter alia; (1) developing Environmental, Health and Safety management systems in line with internationally recognised good practice for both the construction and operational phases of the project; (2) obtaining all necessary consents, approvals and permits for construction and operation in accordance with Turkish legislation; (3) designing and constructing the project in accordance with Turkish regulations and standards for the protection against seismic risks; (4) ensuring all subcontractors follow the Bank's E&S performance requirements; (5) implementing a stakeholder engagement plan and grievance mechanism; and (6) introducing a three yearly independent inspection of all facilities during the operational phase to confirm E&S compliance.

A Stakeholder Engagement Plan will be developed and implemented by the Project Company and the Project will be monitored through annual reporting and site visits.

Technical Cooperation

None.

Company Contact Information

Elif Gumrukcuoglu; Secil Topak
egumrukcuoglu@ccnholding.com; stopak@ccnholding.com
+90 212 377 19 00
http://www.ccnholding.com/

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