- Bridging Pennsylvania Partners, a consortium comprised of Macquarie Capital and S&B USA Concessions – through Bridging Pennsylvania Developer I, LLC – has reached financial close with PennDOT of the first package of the Major Bridge P3 Program.
- Design and construction can now commence on six bridges in critical need of replacement across the Commonwealth of Pennsylvania.
Bridging Pennsylvania Partners (“BPP”), a consortium comprised of Macquarie Capital and S&B USA Concessions – through Bridging Pennsylvania Developer I, LLC (“BPD1”) – has reached financial close with the Pennsylvania Department of Transportation (“PennDOT”) for the first package of its Major Bridge P3 program (the “Program”) to replace six bridges across the Commonwealth out of nine bridges included in the Program.
The project consists of the design, build, financing, and maintenance of six bridges in critical need of replacement across the Commonwealth – I-81 Susquehanna, I-80 Nescopeck Creek, I-78 Lenhartsville, I-80 Lehigh River, I-80 Canoe Creek and I-80 North Fork – plus related roadway and supporting infrastructure, delivered under an availability-based P3 structure. Commercial close was reached between BPD1 and PennDOT on Nov. 29, 2022.
The financing included a mix of equity and debt. The project sponsors will contribute $202 million in equity and raised $1.8 billion in private activity bonds (“PABs”). In challenging capital market conditions and with the support of partners including PennDOT and its advisors (Ballard Spahr, KPMG, Bluebird Advisors and PFM), PEDFA, Pennsylvania Office of the Budget, Wells Fargo and JP Morgan as underwriters, Orrick, Herrington & Sutcliffe, Mayer Brown, Greenberg Traurig, Turner Law and Andre Dasent as legal counsel, and Macquarie Capital as financial advisor, BPP led the largest PAB bond issuance for a P3 since 2016.
Reaching this milestone allows BPP to proceed with the design and construction of the first six bridges of the Program, with construction set to begin in September 2023 and to be completed between September 2027 to June 2028. The design and construction of the work will be undertaken by a joint venture consisting of S&B USA Construction and FCC Construction.
The Program includes a total of nine bridges, six to be completed in this first package and an additional three in a second package. Macquarie Capital and S&B USA Concessions will work collaboratively with PennDOT to develop the second package of the Program under a pre-development agreement, similar to the process undergone by the parties for the first package.
“Taking a P3 approach to designing, building, financing and maintaining this essential infrastructure allows PennDOT to accelerate repair and construction on six bridges in critical need of replacement across the Commonwealth, which will have direct positive impact on Pennsylvania residents, businesses and the local economy, with the vast majority of the work being delivered by local Pennsylvania suppliers and contractors,” said Sarah Schick, Head of P3 North America at Macquarie Capital.
“These bridges are essential pieces of Pennsylvania’s intra- and interstate transportation system. The Major Bridge P3 program is a great example of how the public and private sector can truly partner to deliver critical infrastructure projects faster and more efficiently than any other alternative procurement process,” said Sharon Novak, CEO of S&B USA. “This procurement will also ensure that these bridges remain in good condition for many years, as it includes the maintenance of the assets for 35 years after construction.”
BPP is represented by local firms throughout the consortium, including S&B USA Concessions, S&B USA Construction and its subsidiary, Joseph B. Fay, Wagman, H&K Group, Kokosing, Michael Baker International, Alfred Benesch and Borton-Lawson, all of which are located or headquartered in the state of Pennsylvania and have over a 20-year track record of successful project delivery with PennDOT working in multiple PennDOT districts.
About Shikun & Binui (S&B) and S&B USA
Established in 1924, Shikun & Binui Ltd. (S&B) is an experienced construction, development and real estate group, headquartered in Israel and active globally. S&B is publicly traded on the Tel Aviv Stock Exchange (SKBN) and is active in Israel and globally in the development and construction of large scale, complex heavy civil infrastructure.
