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BAM secures funding for Irish PPP schools

13 Nov 12 A €50m (£40m) loan from the European Investment Bank (EIB) has opened the way for BAM to start construction of eight schools in Ireland.

BAM PPP was appointed preferred tenderer in September 2011 and all planning issues were granted by May of this year.  Now that funding has been secured, construction can start immediately.

The 18-months construction of the schools will be undertaken by BAM Building. BAM FM Ireland will maintain the schools throughout the 25-year contract.

The schools are Ireland’s first public sector projects to be funded under the PPP model since June 2010.

The schools in the counties of Westmeath, Leitrim, Limerick, Galway, Donegal, Wexford and Waterford are the third bundle of schools to be built under the Department of Education & Skills school PPP programme.  They are part of a €1.5bn five-year school-building programme.

The total value of the construction costs is estimated to be approximately €100m. The eight schools will provide accommodation for approximately 5,700 students.  Six of the eight schools are second-level schools; while the two remaining schools to be built in Doughiska, Co. Galway, are a primary and a secondary school, which will share a single campus.

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Minister Ruairí Quinn said: “I am particularly pleased that the EIB has again decided to support the Department’s schools capital investment programme with a loan of €50 million which will assist in funding this investment. It is a further signal of the bank’s renewed confidence in the Irish State and our recovery programme.”

President of the EIB, Werner Hoyer, said: “The landmark agreement to support construction of eight new schools marks the reopening of the PPP sector in Ireland. The European Investment Bank is committed to enabling education investment in Ireland. This project complements EIB support provided in July to build 550 new classrooms and backing to redevelop University College Dublin a year ago.”

The project financing includes EIB, Bank of Ireland and the National Pensions Reserve Fund (NPRF).

Theo Cullinane, BAM Chief Executive said, “We are pleased to be investing in the Irish market and to have been able to partner with the Department of Education & Skills, the NDFA and our senior lenders Bank of Ireland, the European Investment Bank and the National Pensions Reserve Fund to develop a financing solution for the project.  The successful financing of this project augurs well for future PPP projects.”

All schools are expected to be completed by 2014.  Their completion will bring the total number of schools delivered under the PPP model in the state to 23.

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