1. Creative approaches to financing capital projects

2. Introduction Julie Tolley Capita consulting FE Director Richard DinsdaleCapita Symonds LtdRegional Director

3. Example College- Estate profile Site A Site B Site C Site D Site E Site F New Skills Centre New Skills Centre VI Form Centre

4. Traditional Approach Education Business Case Current Business & Financial Structure PROPERTY STRATEGY Development fund Debt Asset sale Reserves Efficiencies Acquire site(s) Appoint designers Develop designs Appoint contractor Construction period Decant Occupy Risk Management- what are the key issues here?

5. PROPERTY STRATEGY Education Business Case Current Business & Financial Structure Creative Approach STRATEGIC PARTNERSHIP VEHICLE INVESTOR PARTNER COLLEGE Utilise Gross Development Value of disposal sites Efficiency savings Shared services BPO Analysis Capitalise significant Revenue savings identified Generate £52m New project Development fund

6. Gross Development value GDV Site A: High quality housing site £75m Gross Development Cost £50m Development surplus £25m GDV Site D: Health project £8.0m Gross Development Cost £5.5m Development surplus £2.5m GDV Site E: Affordable housing site £8.0m Gross Development Cost £5.5m Development surplus £2.5m Total Development surplus £30m

7. Revenue efficiencies Efficiencies achieved in the following areas: Admin function savings: £400k Energy savings: £250k FM/ Maintenance backlog: £300k Rental savings: £50k Rates savings: £100k Driving ICT efficiencies: £100kTotal Revenue Savings £1.2m Capitalised at 5.75- 6.25%Capitalised Revenue: £22m

8. Capita credentials in generating efficiency savings Major share of UK BPO market- 25% Nearest competitor Accenture with 4% Currently operating in the following sectors: Health care Local Authority Central Government Uniformed services Leisure Generally targeting 30% savings College figures calculated on making no more than 2.5% annual savings

9. Summary Total site development surplus: £30m Total capitalised revenue savings £22m Total Development fund £52m

10. Risk mitigation through process Strategic partnership lives only for duration of project No development risk attached Quick release clause can be included Final Estate outcomes are agreed prior to establishment Cost of operations are pre agreed with Investor partner Programme risk significantly reduced All new works complete prior to decants and disposals

11. Education Business Case- Added Value College