Bursa Hospital PPP

Location:

Turkey

Project number:

48535

Business sector:

Municipal and environmental infrastructure

Notice type:

Private

Environmental category:

B

Target board date:

05 Apr 2017

Status:

Disbursing

PSD disclosed:

12 Aug 2016

Translated version of this PSD: Turkish

Project Description

The EBRD is considering financing a hospital infrastructure PPP project involving the design, construction, equipping, financing, and maintenance of an integrated health campus in Bursa, Turkey, pursuant to a 28-year concession awarded by Turkey's Ministry of Health ("MoH"). Under this PPP structure, the concessionaire will supply and maintain the hospital facilities, while the provision of medical care and services will remain the responsibility of the MoH. Total project costs are estimated at around EUR 513 million.

Bursa Hospital PPP campus will comprise three buildings with a total bed capacity of 1,355: a general hospital (275 beds), cardiology (275 beds), oncology (252 beds), maternity/paediatric (253 beds), physical therapy and rehabilitation (200 beds), and high security forensic psychiatric (100 beds).

Project Objectives

The EBRD will assist in increasing private sector participation in the hospital infrastructure sector in Turkey. In response to the need for large capacity investments in healthcare systems, the government is seeking to tap private sector resources and know-how to construct and manage infrastructure related facilities more rapidly and more efficiently, while medical service provision remains under the responsibility of the state.

The consortium of sponsors includes Ronesans Saglik Yatirim A.S., Meridiam Infrastructure Eastern Europe S.a.r.l., Sila Consulting Medical Services, Sam Engineering and TTT Saglik Hizmetleri A.S. who are active across various hospital PPPs in Turkey, including the Adana and Elazig campuses.

Transition Impact

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

1. Demonstration of new and replicable behaviours and activities: new ways of financing, procuring, operating hospital facilities management: 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. The promote the use of PPP contracting, and demonstrating good practice in international PPP standards.

2. Demonstration of better value all-in cost service than a public sector alternative: the project is expected to deliver better value from an all-in cost service perspective when compared to the public sector alternative, providing a high value for money to the MoH. Following a review of the tender documentation and the template PPP contract, the Turkish hospital PPP programme is seen as effective in procuring hospital infrastructure services.

3. Setting new business standards: as part of the PPP contract, the project is expected to achieve high standards of business conduct and good practice, including advanced medical technologies and facilities, implementing performance-based compensation schemes for the facility manager and enhancing the quality of monitoring.

Client Information

BRS SAGLIK YATIRIM A.S.

The client is BRS Saglik Yatirim A.S., a special purpose company incorporated in Turkey and owned by Ronesans Saglik Yatirim A.S., Meridiam Infrastructure Eastern Europe S.a.r.l., Sila Consulting Medical Services, Sam Engineering and TTT Saglik Hizmetleri A.S.

The client is responsible for designing, building, financing and operating the Bursa Hospital PPP, whilst MoH will remain responsible for the provision of medical care and services.

Meridiam
Umut Aydin
4, place de l'Opera, 75002, Paris, France
+33 153 34 96 96
u.aydin@meridiam.com

Ronesans
Sabri Can Bozkurt
Aziziye Mah. Portakal Cicegii Sokak No: 33 Y. Ayranci, 06540 Ankara, Turkey
+90 312 441 31 41
can.bozkurt@ronesans.com

EBRD Finance Summary

EUR 75,000,000.00
The EBRD is planning to arrange an A/B loan of up to EUR 300 million (up to EUR 75 million A-loan, up to EUR 225 million B-loan). The Bank will provide finance in parallel with international financing institutions and commercial banks alongside the sponsors' equity commitments under an 80:20 debt-to-equity structure.

Total Project Cost

EUR 513,400,000.00
Total project costs are estimated at circa EUR 513 million, of which EUR 428 million will be used for engineering, procurement and construction and other costs during the construction stage.

Environmental and Social Summary

The project was categorised "B" in accordance with 2014 EBRD Environmental and Social (E&S) Policy. The project's compliance with EBRD performance requirements was assessed and impacts identified can be readily addressed through mitigation measures and management programmes.

The Bank undertook a site visit to clarify issues and mitigation measures. The sponsors have developed a Non-Technical Summary (NTS), Environmental and Social Impact Assessment (ESIA), Environmental and Social Management Plan (ESMP), Stakeholder Engagement Plan (SEP) and Environmental and Social Action Plan (ESAP).

The circa 745 hectare project site is located in Bursa Province, Nilufer district, Dogankoy neighbourhood. The land is owned by the MoH and no land acquisition is required. The project site consists of two parts, north and south, separated by the Bursa Ring Road (E-90) and surrounded by agricultural land. The northern part of the project site surrounds privately owned agricultural land of circa 50,000m2 to which regular access will be maintained at all times. The closest settlement to the northern part is Balat (1.5 km) and to the southern part Dogankoy (1.5 km) as well as some residential areas around 50 m to the east of the site.

The due diligence did not identify any significant issues. No biodiversity impacts were predicted. The project site is located within the first degree seismic zone. The project uses seismic isolators and buildings are designed according to Turkish legal requirements and international hospital design standards.

Mitigation measures for noise, dust and vibration have been developed as part of the Environmental and Social Management Plan. Traffic management was assessed. The site is currently accessible to private cars but not public transport. There are plans to develop new road networks as well as public transportation, including light railway, as part of the city's wider transport development plans.

A waste management system has been developed for both the construction and operation phases. Medical waste will be sent to the regional medical waste sterilization unit. Small amounts of low level radioactive waste during the operational phase, as well as infectious disease control will be strictly handled in accordance with regulations and good international practice.

No significant adverse social issues were identified and the project is expected to provide important social infrastructure and improved health services to the population. Up to approximately 3,000 workers are expected to be employed during construction. Onsite worker accommodation and an occupational health and safety management system will be developed in line with Turkish legislation and international standards. Approximately 4,000 workers will be employed during operation of the project. Grievance mechanisms will be provided for workers, including sub-contractors.

An Environmental and Social Action Plan has been developed and agreed with the client to address any necessary commitments to meet EBRD requirements. Management plans are being prepared for the construction camp, traffic, emergency response, and security and will be implemented at the construction stage. The international requirements for life and fire safety and emergency response will be implemented.

A stakeholder engagement plan will be updated and implemented as the project progresses. Public consultation meetings were held in November 2015. Following completion of the final draft of the ESIA package, an ESIA, NTS and SEP will be disclosed on EBRD's website and on www.pppbursahastanesi.com. Additional stakeholder engagement meetings will also be held at Dongakoy neighbourhood. The project's E&S performance will be monitored by the EBRD.

Non-technical summary

Technical Cooperation

Company Contact Information

See under Client Information

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