A public private partnership (PPP) agreement to design, build, finance and operate a new R500-million head office campus of the Department of Trade and Industry (DTI), in Pretoria, has been signed between the DTI, the Department of Finance, the City of Tshwane and empowered consortium Rainprop.

The DTI has awarded a 25-year master concession to Rainprop to design, build, finance and operate the head office campus, situated on Nelson Mandela Drive.

This is the first national accommodation PPP project to be approved by the National Treasury’s PPP Unit under the Public Finance Management Act 1 of 1999.

As such, its concession terms and financing structure will provide a precedent for similar PPP deals in the future.

Standard Corporate and Merchant Bank advised, arranged and underwrote finance for the design and construction of the project.

The funding package was structured on a non-recourse basis, and incorporated senior terms loans and mezzanine finance. An innovative funding structure was put in place to support the investment in Rainprop by the empowerment shareholders.

The DTI will make monthly payments to Rainprop in terms of the PPP concession agreement, which will cover costs of providing the facilities management service and servicing the capital raised.

The project consists of a design and construction phase and a facilities-management phase.

The design and fast track construction phase, expected to be complete within the next 12 months, is a partnership between Atterbury, Parkdev, WBHO, Rainbow Construction and Zwelinzima.

Rebserve, Propnet, Prop 5 Corporation and Zwelinzima will provide facilities management over the remaining 24 years of the 25-year concession period. They will be responsible for the operational and life cycle management, which includes replacement, maintenance and upgrading of assets during the concession period.

The new DTI campus is located within the Mandela Development Corridor, a private sector urban renewal initiative that enjoys full support from the City of Tshwane.

The 44 000 square metre office campus, with its two-level super basement, has been designed to accommodate 1 700 DTI personnel, which includes most of its agencies and family units.

The design challenge posed to Rainprop was to establish a truly southern African architectural language that can speak to the very core of the DTI’s business, which is trade and industry.

The symbols used, therefore, have to balance the parochial and the global and arrive at an architectural language that will be recognisably African and yet find application at an international level.

The City of Tshwane Metropolitan Municipality has made the land available to the DTI and Rainprop for the duration of the concession as a long-term lease, which is included as part of the PPP concession agreement.