Greg Russell, Vice President of Development for Aeroterm, recently lead a panel at the P3 Summit where he discussed aligning risk and incentives between airports, developers, design-builders, and operators. Greg discussed the wins that are being achieved in the market, how they are structured, and the lessons learned that airports can benefit from. He also touched on the desired balances to be achieved by both the public and private sectors in determining the toughest factors that make the difference between closing a deal and walking away from the table.
One of the hallmarks of a successful P3 project is the sharing of risk between the public and private sectors. From an airport’s perspective, these include economical financing structures, the degree to which the asset at issue is perceived as core to the airport’s function, the airport’s willingness to cede control over design and operation, and the presence or absence of a political champion. From the developers, design-builders, and operators perspective, these factors may include confidence in partners commitment, allocation of construction risk, and long-term relationship and asset risk.