UC Merced has awarded a contract to Plenary Properties Merced, which will be the university’s partner in the 2020 Project, a $1.14 billion expansion to ready the university for a population of 10,000 students, officials announced Wednesday.
The Vancouver, Canada-based Plenary Group anchors the consortium of design, engineering, construction, maintenance, operations and financial partners. The company is an international infrastructure developer involved in public-private partnership projects across North America, according to its website.
“We are impressed by the creativity, efficiency and aesthetic qualities evident throughout the winning proposal,” UC Merced Chancellor Dorothy Leland said in a news release. “Plenary Properties Merced has produced a compact, environmentally sensitive design that blends beautifully with our existing campus, facilitates our multidisciplinary teaching and research methods, and provides flexibility for future changes in building usage. Most important, it’s a cost-effective way of building out our campus.”
Leland said the UC Board of Regents will be asked in July to review and approve the project’s conceptual design and financing, which would clear the way for a formal contract in August, according to a news release. Work on buildings could begin the next month.
The project is expected to create more than 10,000 construction jobs in the San Joaquin Valley (more than 12,000 statewide) during the four-year construction period, officials said. The one-time economic benefit to the region will be an estimated $1.9 billion ($2.4 billion statewide).
The project would be the first in the UC system to use a single private development team for a multi-year, multi-building project of this scope, according to officials. The bid winner will not only design and build all of the new facilities as a single, fast-track project, but will be required to ensure major building systems operate effectively over the 39-year term of the contract.
The developer would also be responsible for raising all required private financing as part of the public-private partnership.
UC President Janet Napolitano said UC Merced, the youngest campus in the system, could become a model for other campuses looking for the most efficient ways to expand. “As the first public research university to be created in the 21st century, UC Merced is prepared to build on its remarkable academic achievements as the campus itself is built out to accommodate future growth,” she said in a news release.
Financing for the project will include up to $600 million in regents-issued revenue bonds, officials said, pending approval in July, with the rest coming from the developer and UC Merced’s own funds.
“The 2020 Project effectively leverages private capital in conjunction with UC funds to both cover project costs and allow UC to make efficient use of our own financial resources,” said UC Chief Financial Officer Nathan Brostrom, in a news release.
The unusual approach provides a long-term incentive for building performance and preventative maintenance, according to UC officials, and ensures annual costs are within the limits established last year by the regents.
PPM’s lead contractor is Webcor Builders, a San Francisco-based firm whose previous projects include California Memorial Stadium at UC Berkeley, Zuckerberg San Francisco General Hospital and the California Academy of Sciences. Johnson Controls is providing the operations, maintenance and renewal services to the project throughout the 39-year contract term.
“The UC Merced 2020 Project will put UC Merced at the forefront of higher-education design and delivery in the U.S.,” Dale Bonner, executive chairman of Plenary Concessions, said. “Plenary is delighted to be a part of this partnership.”