How to better implement public-private partnerships—and avoid common mistakes

As higher education faces significant funding and maintenance challenges, institutions are increasingly turning to public-private partnerships (P3s) to achieve their infrastructure goals. Broadly, P3s refer to a variety of contracting arrangements between a public entity or non-profit and a private sector entity to finance, construct, renovate, manage, operate and/or maintain infrastructure. Effective P3s can provide numerous benefits, such as expedited project delivery, access to private sector financing and expertise, and facility lifecycle maintenance.

A middle ground between traditional delivery and full privatization

P3s are compelling because they offer a middle ground between traditional project delivery methods and full privatization. Historically, higher education institutions used public funds to contract with private companies for the design and construction of new facilities, retaining significant control but assuming most project risk. On the other end of the spectrum, full privatization entails transferring all project risks, ownership, and control to a private sector company. By comparison, P3s offer a middle ground where the institution retains ownership and substantial control of a facility but transfers responsibilities of design, building, financing, operating, and/or maintenance to a private partner under a single contract.

navigate public-private partnerships

Success is far from guaranteed

Though the potential benefits of P3s are attractive, moving too quickly on a P3 deal can lead to major financial consequences. Problems typically arise when institutions neglect to secure buy-in from campus stakeholders, don’t evaluate the feasibility of a P3, or lack building organizational capacity needed to manage such complex projects. In fact, a poorly planned and managed P3 project at the University of Québec at Montreal (UQAM) nearly bankrupt the institution and led to the president’s resignation.

navigate public-private partnerships

10 imperatives to evaluate, plan, and implement P3s

To help leaders better navigate P3s, the Facilities Forum’s new publication details ten imperatives for evaluating, planning, and implementing a P3 to build new campus facilities and infrastructure. To supplement this guidance, the publication includes seven detailed case studies of institutions that have successfully leveraged P3s to achieve infrastructure goals.

navigate public-private partnerships

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Navigating Public-Private Partnerships

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