S.S.B. Investment Project to Construct a Public Administration Campus
The Social Security Board met with the media today to provide information on an investment project that it is undertaking with the Government of Belize for the construction of two new buildings adjacent to the Eleanor Hall Building on Independence Boulevard in Belize City. The project is going to cost approximately fifty-four point three-five million dollars; twenty point four million dollars will be provided by the S.S.B. through a twenty-year loan facility at an interest rate of five point five percent. The end goal is that G.O.B. will acquire another building for a one-stop shop for public services. News Five’s Duane Moody reports.
Duane Moody, Reporting
The Government of Belize is planning to build two public administration buildings adjacent to the Eleanor Hall Building, colloquially referred to as the finance building on Independence Boulevard in Belize City. It’s a proposal that intends to address renting multiple buildings across the city and consolidating at a fixed price. It will cost over fifty-four million dollars and the Social Security Board is partnering with G.O.B. for the construction of one of the two buildings.
Christopher McGann
Christopher McGann, Managing Director, PPF Capital Belize Ltd.
“The government is trying to get public infrastructure and working with the private sector to finance and execute the projects. In this case, it is for additional government buildings to be used for office space and as we mentioned, the plan is to build two buildings, a hundred and twenty thousand square feet in total adjacent to the Eleanor Hall Building. We had done the initial feasibility study to look at modelling what the cost and revenue streams might look like for this project and to sort of pitch to potential debt and equity investors. There’s two equity investors one is the Government of Belize and the other equity investor is Belize Social Security Board.”
A public notice of investment has been placed in the newspaper announcing that the S.S.B. will lend twenty million, four hundred thousand dollars to Public Administration Campus (SPV) Limited, the company that is being created to manage the project. The partnership will see three directors appointed from S.S.B. and two from G.O.B. to oversee the operations for the construction of the five-storey climate resilient and energy efficient building.
Deborah Ruiz
Deborah Ruiz, C.E.O., Social Security Board
“As you know in our banking system, Social Security has an influx of cash. We are very liquid, so we are looking for viable investments that we can put our money to best use so that we do not have to go back to contributors. That has been our ethos in terms of our investment portfolio. We are talking about a viable project. So yes, Social Security said if we are going to do this, we need to be in control so in terms of the majority, it is Social Security who would have the majority seats as the equity partner in the company. The special vehicle is just to facilitate the process because Social Security is not in the business of doing construction, as you well know. So this company will be charged with the responsibility to manage the construction process and to manage the investment that we are making in this to build the buildings for G.O.B. and also to raise the additional equity. The entire project as we said is over fifty-four million and Social Security is not putting up all that money. We are putting in, as the equity partner, a percentage in terms of the first building so the company has to then raise by putting out to other public investors who would want to join and benefit from this.”
The S.S.B. will also invest an additional seven point nine million dollars for a public private partnership with G.O.B. for a new model for the construction and operation of the real estate development of the two buildings. At the end of the partnership term of thirty years, the ownership rights and responsibilities will be transferred to the Government of Belize.
Christopher McGann
“It’s a BOLT, so it is build own lease and transfer. So the company, Public Administration Campus Limited will be responsible to run up procurement and project management to get a firm or group of firms to actually execute the construction of the building. We are estimating, after we’ve finished the procurement process, that it will take somewhere around twenty-seven months. So the analysis that the board will be responsible for is to see whether or not we believe the bids that we receive are credible to get it done within the suggested timeframe. It is a long-term investment which kinda matches some of the structural portfolio needs of the S.S.B. We expect the debt repayment to be finished in about twenty years and the PPP arrangement to be finished in thirty years and thereafter, we expect that the building will be transferred. So the last part of it – build own lease so the company will collect the lease payments and then pay creditors and dividends to the equity holders and then transfer to the Government of Belize as a public asset at the end of the thirty-year period.”
Deborah Ruiz
“What we like about the project is that we are guaranteed a hundred percent rental of the building from the government, initially at four percent. And Mister McGann mentioned, we have a hundred thousand of rentable space; that’s monthly and you multiple, you can do the numbers in terms of return on investment. And once we are able to manage a project successfully, making sure that the construction process is timely and within budget then we are able to meet the expectations of the project, that it will be profitable. Social Security gets investment on the liquid cash that we have, government gets the building that it needs and it is still within a safe space.”
Duane Moody for News Five.
