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BPP Closes on Pennsylvania Major Bridges P3

We are excited to announce that the PennDOT Major Bridges P3 program reached financial close today! As a construction partner of Bridging Pennsylvania Partners (BPP), we are looking forward to working on the replacement of 6 sets of bridges.

Read the press release below.

Bridging Pennsylvania Partners achieves key milestone in PA Major Bridge P3 Program

  • Bridging Pennsylvania Partners, a consortium comprised of S&B USA Concessions and Macquarie Capital – through Bridging Pennsylvania Developer I LLC – has reached financial close with PennDOT of the first package of the Major Bridge P3 Program.
  • Design and construction can now commence on six bridges in critical need of replacement across the Commonwealth of Pennsylvania.

Pittsburgh, PA, December 22, 2022

Bridging Pennsylvania Partners (“BPP”), a consortium comprised of S&B USA Concessions and Macquarie Capital – through Bridging Pennsylvania Developer I, LLC (“BPD1”) – has reached financial close with the Pennsylvania Department of Transportation (“PennDOT”) for the first package of its Major Bridge P3 program (the “Program”) to replace six bridges across the Commonwealth out of nine bridges included in the Program.

The project consists of the design, build, financing, and maintenance of six bridges in critical need of replacement across the Commonwealth – I-81 Susquehanna, I-80 Nescopeck Creek, I-78 Lenhartsville, I-80 Lehigh River, I-80 Canoe Creek and I-80 North Fork – plus related roadway and supporting infrastructure, delivered under an availability-based P3 structure. Commercial close was reached between BPD1 and PennDOT on Nov. 29, 2022.

The financing included a mix of equity and debt. The project sponsors will contribute $202 million in equity and raised $1.8 billion in private activity bonds (“PABs”). In challenging capital market conditions and with the support of partners including PennDOT and its advisors (Ballard Spahr, KPMG, Bluebird Advisors and PFM), PEDFA, Pennsylvania Office of the Budget, Wells Fargo and JP Morgan as underwriters, Orrick, Herrington & Sutcliffe, Mayer Brown, Greenberg Traurig, Turner Law and Andre Dasent as legal counsel, and Macquarie Capital as financial advisor, BPP led the largest PAB bond issuance for a P3 since 2016.

Reaching this milestone allows BPP to proceed with the design and construction of the first six bridges of the Program, with construction set to begin in September 2023 and to be completed between September 2027 to June 2028. The design and construction of the work will be undertaken by a joint venture consisting of S&B USA Construction and FCC Construction.

The Program includes a total of nine bridges, six to be completed in this first package and an additional three in a second package. Macquarie Capital and S&B USA Concessions will work collaboratively with PennDOT to develop the second package of the Program under a pre-development agreement, similar to the process undergone by the parties for the first package.

“Taking a P3 approach to designing, building, financing and maintaining this essential infrastructure allows PennDOT to accelerate repair and construction on six bridges in critical need of replacement across the Commonwealth, which will have direct positive impact on Pennsylvania residents, businesses and the local economy, with the vast majority of the work being delivered by local Pennsylvania suppliers and contractors,” said Sarah Schick, Head of P3 North America at Macquarie Capital.

“These bridges are essential pieces of Pennsylvania’s intra- and interstate transportation system. The Major Bridge P3 program is a great example of how the public and private sector can truly partner to deliver critical infrastructure projects faster and more efficiently than any other alternative procurement process,” said Sharon Novak, CEO of S&B USA. “This procurement will also ensure that these bridges remain in good condition for many years, as it includes the maintenance of the assets for 35 years after construction.”

BPP is represented by local firms throughout the consortium, including S&B USA Concessions, S&B USA Construction and its subsidiary, Joseph B. Fay, Wagman, H&K Group, Kokosing, Michael Baker International, Alfred Benesch and Borton-Lawson, all of which are located or headquartered in the state of Pennsylvania and have over a 20-year track record of successful project delivery with PennDOT working in multiple PennDOT districts.

About Shikun & Binui (S&B) and S&B USA
Established in 1924, Shikun & Binui Ltd. (S&B) is an experienced construction, development and real estate group, headquartered in Israel and active globally. S&B is publicly traded on the Tel Aviv Stock Exchange (SKBN) and is active in Israel and globally in the development and construction of large scale, complex heavy civil infrastructure.

S&B USA – The company has been active in the U.S. since 2012 and its U.S. operation is headquartered in Pittsburgh, PA. S&B USA’s focus is on development and construction of large infrastructure projects, and the company operates through its infrastructure development and equity subsidiary, S&B USA Concessions and its construction subsidiary, S&B USA Construction, along with its subsidiary Joseph B. Fay (branded as Fay, S&B Construction). In 2020, S&B launched its U.S. energy activity through Shikun & Binui Energy Ltd.’s subsidiary, S&B USA Energy. Additionally, Shikun & Binui has U.S. operations/offices in Houston, TX, Fargo, ND, Miami, FL, Virginia Beach, VA and Baltimore, MD. For further information, visit www.shikunusa.com

Shikun & Binui Energy Finishes Construction and Closes on Debt and Tax Equity Financing

Company built Brazoria West Solar Project in Texas, its largest solar plant to date.

Read the press release below.

Palm Beach Gardens, FL – December 15, 2022: Shikun & Binui Energy has completed the construction of the 260 megawatts (MWdc) (200 MWac) Brazoria West Solar Project, acquired from Savion in 2021.

“The completion of Brazoria West is a significant milestone for the group and paves the path to our goal of becoming an integrated IPP in the US” stated Didi Paz, CEO of Shikun & Binui Energy.

The construction at Brazoria West Solar Project, located in Brazoria County, 40 miles southwest of Houston, Texas, commenced in Q2 2021 with the Commercial Operation Date (COD) achieved in November, 2022. The project’s total output capacity allows to power approximately 37,100 homes.

“Brazoria West is the largest solar project ever built by our group. It demonstrates our ambition to be a key player in the transition to a carbon free future” said Kevin Yaich, President of S&B US Energy. “I would like to thank all our partners, lenders, contractors and transaction teams for their excellent work, trust and cooperation. I am extremely proud of the Shikun & Binui Energy’s efforts and resilience to complete the project in a 2021/22 challenging environment for the US solar industry.”

“The successful completion of Brazoria West is a testament to Shikun & Binui Energy’s ability to effectively manage complex transactions and pave the path on becoming a global IPP. We look forward to executing more opportunities and continuing to grow our renewable portfolio in the US” stated Jeremie Debomy, EVP of S&B USA Energy.

This is the fourth renewable asset investment Shikun & Binui Energy has made in the US, following the investments in Beacon II and Beacon V PV projects in 2020 and in the Saticoy Battery Storage Project in 2021, both located in California.

Brazoria West Solar Project will supply power to the Houston area and has secured one commercial and industrial Power Purchase Agreement (PPA) and another PPA with an energy trading company. A portion of the environmental attributes of the facility are being sold to these two offtakers as part of the PPAs.

CIT Group’s Power and Energy business led the debt financing. Macquarie and RBC have arranged the tax equity financing for the project.

About Shikun & Binui Energy
Shikun & Binui Energy Ltd. (S&B Energy) is an experienced Developer, Owner and Operator of energy assets, both conventional and renewable, headquartered in Israel and active globally. S&B Energy is publicly traded on the Tel Aviv Stock Exchange (SBEN) In 2020, S&B Energy launched its U.S. energy activity through its subsidiary, S&B USA Energy Inc. (branded as S&B USA Energy). For further information, visit www.shikunusa.com/Energy.

For inquiries, contact:
Katie Spear | S&B USA Energy Mobile: 412-779-0635 KSpear@shikunusa.com

I-579 CAP park project leads to donations to Hill District organizations

Fay, S&B USA Construction was pleased to be part of the celebration of our I-579 Cap project winning a regional America’s Transportation Award from the American Association of State Highway and Transportation Officials (AASHTO) in the “Quality of Life/Community Development” category. And also to help give back to the community through a donation to Ozanam Inc. and ACH Clear Pathways located in the Hill District. Speakers included Yassmin Gramian – PennDOT Secretary, Cheryl Moon-Sirianni – District 11 Executive, , Rich Fitzgerald – Allegheny County Executive, Jake Wheatley – Chief of Staff to Mayor of Pittsburgh, and Wayne Fontana – PA Senator/SEA Board Chairman.

Click here to read the article.

Pennsylvania Borrowing $1.9 Billion to Fund Bridges

Pennsylvania is tapping the municipal bond market to ensure its bridges are able to withstand car traffic less than a year since a bridge in Pittsburgh collapsed, and with about 14% of the commonwealth’s bridges being classified as structurally deficient. …

Read the rest of the article below.

Bloomberg

Pennsylvania Borrowing $1.9 Billion to Fund Bridges

By Skylar Woodhouse
December 6, 2022

Pennsylvania is tapping the municipal bond market to ensure its bridges are able to withstand car traffic less than a year since a bridge in Pittsburgh collapsed, and with about 14% of the commonwealth’s bridges being classified as structurally deficient.

The Pennsylvania Economic Development Financing Authority is selling about $1.9 billion of bonds to help pay for a series of bridge projects, including construction and maintenance. The total cost is estimated at about $2.4 billion, bond documents show.

The sale is being completed through a public-private partnership agreement to fund a loan to Bridging Pennsylvania Developer I, LLC. Bridging Pennsylvania HoldCo LLC and S&B USA Concessions will contribute a combined amount of up to $225,251,445. The Department of Transportation will contribute as much as $90 million in mobilization payments and a $50 million milestone payment, according to bond documents.

“The Commonwealth has the third largest number of bridges in the United States, and this project is a great example of how the public and private sector can partner to deliver critical infrastructure projects,” said Julie Burger, who is involved in the sale and the managing director of public finance transportation at Wells Fargo Corporate & Investment Bank.

Earlier this year, the Fern Hollow Bridge in Pittsburgh, which was deemed in poor condition by the federal bridge inventory, collapsed, highlighting the need to repair infrastructure in the commonwealth and across the US. The importance of improving US infrastructure is one of the key items on President Biden’s agenda following such incidents as the apartment collapse in Miami last year and the increase of flooding in New York City subways.

Tight Supply

The bonds are expected to price Dec. 13, just ahead of the last Federal Reserve meeting of the year. Muni returns are down about 8% this year and on pace for their worst annual performance since 1980. States and cities have sold about $348 billion this year, down 19%, data compiled by Bloomberg show.

The deal’s timing may be advantageous given the “dearth” of supply, according to Burger. Investors appear eager for an opportunity to look at a new credit that will help fund the revitalization of critical transportation infrastructure, she said.

Dora Lee, the director of research at Belle Haven Investments, said it’s hard to predict how the sale will perform, but since it’s the last full week of trading for the year, there will be pressure to close the deal before people take off for the holidays.

The Pennsylvania Economic Development Financing Authority bond offerings are rated Baa2 by Moody’s rates the deal Baa2, two steps above junk, and Fitch Ratings has it one level lower at BBB-. Wells Fargo Securities and JP Morgan are serving as lead managers. The sale has a lower rating due to the public-private partnership and construction risks involved, according to Lee.

Moody’s has a stable outlook on the debt and expects the project will be completed even with the potential for “some moderate delays.”

Projects from the financing will include the replacement of six major bridges over a 66-month construction period.

“The country’s backlog of infrastructure projects has been known for a long time. The longer it takes for infrastructure assets to be repaired and maintain properly, the higher the costs will be,” Lee said. The fact that the commonwealth “has packaged several bridges into this deal reflects the urgent need for these repairs and the overall struggle states face to keep up with its infrastructure needs.”