Spotlight on Performance-Based Infrastructure
Long Beach Courthouse: A Turnkey-Design-Build-Finance-Operate-Maintain Project
Major Project Benefits
Delivering the Long Beach Court Building with a full turnkey solution (TDBFOM) allowed the transfer of significant project risks to the party best able to manage them; provided access to new, competitive sources of capital; and focused on lowest cost of occupancy over a 35 year period, rather than lowest first cost.
Experience has taught us that no two organizations are identical and neither are any two infrastructure or real estate projects. What may be an attractive transaction structure for one organization might be too big of a leap for another. The flexibility of the turnkey delivery approach, with regards to the bundling of services and transference of risks, allows for tailored solutions that can meet the needs of any organization and any project, no matter the size or the complexity.
The Governor George Deukmejian Courthouse (aka, the Long Beach Court Building) is a unique project because it represents one transaction in which the private sector tackles all four primary risks associated with facility delivery and long term operations, including: (1) Development, (2) Design and Construction (Schedule and Cost), (3) Financing, and (4) Operations and Maintenance/Life Cycle Costs (Replacements).
“Having the firm responsible for the long-term operation of the building...at the table [during design & construction] is a quality control mechanism of sorts that helps ensure that the product being built using fast track construction will be an enduring asset.”— Clifford Ham Principal Architect at the Administrative Office of the Courts (AOC) of California
Edgemoor Infrastructure & Real Estate is part of the Long Beach Judicial Partners LLC, (LBJP) team that is under contract to turnkey develop, design, construct, finance, operate, and maintain (TDBFOM) the new 545,000 square foot Governor George Deukmejian Courthouse in Long Beach, California. The project is being delivered under a unique Public-Private Partnership agreement, which has a total development cost of approximately $490 million and a Design-Build cost of $343 million.
This court building is the first social infrastructure project in the United States procured under the principles of Performance Based Infrastructure (PBI) contracting. Under the PBI agreement, the California Administrative Office of the Courts (AOC) will own the building and the Superior Court of Los Angeles County will occupy the space. The AOC will pay LBJP an annual, performance based service fee, or Availability Payment, for 35 years. The PBI delivery method will leverage the private sector’s access to financing, technological expertise, and management efficiency to quickly provide a high quality facility that will serve the Superior Court of Los Angeles County.
Edgemoor is providing real estate development services for the project. The scope of work includes significant utility relocations, permitting, and implementation of the California Environmental Quality Act (CEQA). CEQA requirements include preservation of historical artifacts, hiring of an independent building expert with the state building permit authority, and interfacing with local city government for work outside the property line. The development team has also assisted LBJP with establishing commercial leases with Los Angeles County and retail tenants. Clark Construction is leading the design and construction of the new courthouse, including the tenant work.
When complete, the five story building will house 31 courtrooms, court administration offices, Los Angeles County lease space, and commercial and retail leasable space. The building will include below-grade secure inmate transfer facilities, detention facilities, and separate secure parking areas for judges. A five level great room atrium enclosed on two ends by a cable supported glass wall system will serve as the single entry point for the public and provide access to a secured central courtyard. Clad in deeply articulated curtain wall and elements of stone, the project spans two city blocks in downtown Long Beach and will replace the functionally obsolete courthouse building one block away. In addition to the new building, the project team will also renovate and expand an existing 399,000 square foot parking structure.