1. 3rd October 2001 Facilities Management from a Funder’s Perspective Richard Hoile

2. 22/05/02 Facilities Management in a PFI/PPP context  What do bankers look for in a traditional structure?  What will a credit committee expect to have demonstrated to it?  How can FM companies manage their banks? … a funder’s perspective

3. 22/05/02  Track record and experience  Resources required to complete the transaction  Resilience to cope with difficulties Does the FM company know what it is getting into? … a funder’s perspective

4. 22/05/02  Turnover, Profit before Tax,  Tangible Net Worth, Market Capitalisation.  Credit Rating Is the FM company financially resilient? … a funder’s perspective

5. 22/05/02 Can the FM company do the job?  What is the nature of the work to be undertaken?  Have sufficient resources been allocated?  Is the price sufficient?  Has the Payment Mechanism been modelled with realistic deduction and termination scenarios?  How robust is it? … a funder’s perspective

6. 22/05/02 Bank Sensitivity Testing  Increase in Operating Costs by 10-15%  Completion Delay  Low and high inflation  Low and high interest rates … a funder’s perspective

7. 22/05/02 … a funder’s perspective Contractual safeguards required by banks  Appropriate “second line of defence” controls  Termination triggers  SPV to manage contract  Ability to introduce alternative providers  Flexible contract (bundling of services)  Price  Benchmarking/market testing

8. 22/05/02 … a funder’s perspective FM Company Protections  Incentivised to make contract work but not “bet the company”  Benchmarking and Market Testing  Caps - Penalties for Service Deductions Termination Liabilities

9. 22/05/02 … a funder’s perspective How can FM companies and Banks work together better ?  Open and clean lines of communication with the Bank’s Technical Adviser  Partnership approach to problem solving  TA should add value  Spot problems  Anticipate and identify risks etc  Address issues and problems as they arise with appropriate resources

10. 22/05/02 Delivering PPP and PFI Projects Arranging Investing Advisory Richard Hoile 020 7470 7348