We advised the German Federal Ministry for Transport and Digital Infrastructure and DEGES on the procurement of the A7 motorway project in the states of Schleswig- Holstein and Hamburg. This is the largest PPP motorway project in Germany to date as well as the second PPP project based on the ‘availability model’.
Highly complex transaction
The project began in 2011 and reached its financial close in the summer of 2014. In addition to structuring the bid documentation, we advised on the drafting and negotiation of the project contract and provided comprehensive legal advice to the public contracting authority. Norton Rose Fulbright was part of a group of consultants – comprising Schüssler-Plan Ingenieurgesellschaft, Investitionsbank Schleswig-Holstein and Alfen Consult – which has successfully advised on six other German PPP motorway projects.
The extension of the A7 motorway between Neumünster and Hamburg is the second PPP project in Germany based on the ‘availability model’: which means that the remuneration is based on the availability of the motorway for the users, which should be as unrestricted as possible. Using this model, the selected private partner will undertake the six- to eight-lane extension of a 65km stretch of the A7 motorway, assuming responsibility for the operation and maintenance of a 59km stretch of the motorway for a period of 30 years. During construction works (including the construction of a noiseprotection tunnel in the area of Schnelsen) the traffic on one of the busiest roads in Germany will continue to run. The private partner under the PPP project is a group of companies comprising HOCHTIEF PPP Solutions, DIF Infra and KEMNA BAU. This is the first time that a project bond as well as a specific credit enhancement of the European Investment Bank (PBCE instrument) have been used for financing such a project.
Largest PPP motorway project to date
Worth more than €600m, this deal is the largest PPP motorway infrastructure project in Germany to date, financed and carried out by a partnership between the public and private sector.
Strong track record
Our PPP team of transaction and public procurement specialists has been involved in a number of large-scale motorway projects in Germany. After developing a PPP procurement procedure – which has since been adopted as industry standard – we successfully closed the procurement procedures for the first two PPP road construction projects (A8 Munich–Augsburg and A4 in Thuringia) in 2007. We followed this in 2008 with the extension of the A1 Hamburg–Bremen, the largest PPP road construction project at the time. Since 2009, we have been involved in the A5 motorway project Malsch–Offenburg; the A8 project Augsburg– Ulm; and the A9 availability model between the Lederhose junction and the Thuringia/Bavaria state boundary.