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FACULTY COURSE LEADER MARK KOLKE Mark Kolke is President of MaxComm Realty Advisors, a commercial real estate consulting fi rm. He has experience in P3s as an owner’s representative, consortium organizer, bidder and consulting to proponents in pursuit of infrastructure projects and in proposal preparation. CO-LECTURERS GARRETT AYERS Garrett Ayers heads the loan monitoring division at AXIOM Cost Consulting. He has provided Project Cost Monitoring work on many of the country’s landmark projects in both the Toronto and Calgary markets. KAREN J. BARRY Karen Barry is President of Barry Commercial Real Estate and Appraisal Propertyshop. Together these companies provide clients with commercial valuations, appraisals, sales and leasing for Alberta properties. COURSE PROGRAM FINANCING CONSTRUCTION AND DEVELOPMENT Too often, borrowers do not give construction loan requests the proper time and effort required to maximize their chance of success. Timing is crucial, as the more time you have, the better chance to identify risks and successfully mitigate them. This session will outline the recent trends in the fi nancing of construction and development projects. • Sources of debt fi nancing and equity investment for construction • Features of loan packages that will satisfy concerns of lenders • Tools for creating a well documented construction budget • Construction underwriting process • Pricing the risk for construction and development SUPPLEMENTARY COURSE MATERIAL GEORGE HALL George Hall is Director, Finance at MSW Developments. He has thirty plus years of accomplishment as CFO and Controller with local, national and international construction corporations. JONATHAN R. HUGGETT Jonathan Huggett, Principal of J.R. Huggett Company, is an Engineer and infrastructure specialist with over 25 years experience in the delivery of public infrastructure. RANDY LENNON Randy Lennon is Managing Director & Co- Founder of Meridian Merchant Capital Canada Ltd. He is a 30 year entrepreneur who has founded and built successful enterprises in a number of fi elds. DAVID REPETOWSKY David Repetowsky is Managing Director at Western & Pacifi c Financial Corporation. He has had in excess of 30 years in commercial banking, real estate and mortgage banking and specializes in Commercial mortgage fi nancing. <strong>Federated</strong> <strong>Press</strong> is now providing delegates with access to an innovative new database containing at least 25 interactive multimedia presentations by leading experts including approximately 20 hours of lectures on the topics covered by this course, including all slides and speakers’ papers. See the list of presentations on page 4. STEPHEN REVAY Stephen O. Revay, Vice-President, Western Region, Revay and Associates Limited, has been active for the past 32 years in the analysis of progress, productivity and cost on numerous construction projects. STEVE SMALL Steve Small, Vice-President of Business Development, Canadian Region, Flatiron Corporation, is an internationally experienced and proven leader in the management and delivery of large infrastructure projects. ANDREW E. STEAD Andrew Stead is a Partner in the Litigation and Business Law practice groups of McMillan’s Calgary offi ce. His practice focuses on commercial dispute resolution and commercial and product liability defenses. DANIEL STEWART Daniel Stewart is Managing Partner at Canadian Mortgage Capital (Alberta) Ltd. He has over 35 years experience in real estate lending, feasibility analysis, project marketing and sales management in Western Canada and U.S. markets. APPRAISAL CONCERNS ON FINANCING CONSTRUCTION PROJECTS If a project is well formulated and thoroughly appraised, a good followthrough on the subsequent stages of the project cycle will see to its goals being achieved. This session will explore appraiser concerns on fi nancing construction projects. • Careful checking of the basic data, assumptions and methodology used in project preparation • In-depth review of the work plan, cost estimates and proposed fi nancing • Assessment of the project’s organizational and management aspects • Validity of the fi nancial, economic and social benefi ts expected from the project Audio/video segments clickable slide by slide Papers and overheads also included Print any of the material for your own use
COURSE PROGRAM SKATING THROUGH THE CONSTRUCTION FINANCING MAZE Finding the most appropriate sources of funding, structuring the deal, papering and above all closing the financing can be challenging. Whether debt or equity, or a combination, your financing source becomes a partner in the success of the project. This session will explore ways to determine what loan type and structure is most appropriate, as well as how to create winning strategies for finding the right capital source. • Determining the capital type best suited for your needs • Best practices for approaching lenders/investors/sources of capital • Choosing a source of capital • Choosing the right advisors/intermediaries and how to work effectively with them PUBLIC PRIVATE PARTNERSHIPS: ARE THEY AN EFFECTIVE FINANCING VEHICLE? The PPP marketplace in Canada has come into its own, drawing players from all over the world. Pursuit costs are high, success is rare, but rewards can be rich. For owners, particularly governments and NGOs, the refinement in analytical tools, life-cycle costing and political optics make for interesting drama. This session will help participants understand how each stakeholder views P3, how projects come about, morph, succeed and fail. • When is P3 the best approach? • Variations on the P3 concession: JVs, partnerships, design, build, own, operate, finance and transfer • What P3Canada is, or isn’t, doing to help • “Have” and “have-not” provinces CAUSES OF CONSTRUCTION PROJECT OVERRUNS: PROTECTING YOUR INVESTMENT Every construction project is susceptible to unidentified risks. Failure to mitigate and properly manage these risks will lead to cost overruns and expensive delays in project delivery. This session will explore the common causes of construction project overruns and present ways to avoid and address them to minimize their impact on success. • Major reasons for cost overruns in construction • Best practices for protecting projects against cost overruns • Importance of realistic project cost estimates from the outset • Common errors in budgeting/estimating a project • Improving risk tracking and monitoring for emerging risks DEALING WITH CONSTRUCTION LIENS This session will provide an overview of the lien provisions under the Construction Lien Act and how they affect projects and project financing. There will also be a discussion of how to deal with construction liens once asserted so as to lessen the impact of them upon project completion. • Overview of the Construction Lien Act: lien remedies, trust remedies • Holdbacks • Dealing with liens: vacating liens, lien actions, statutory limits on liability, practical tips • Priorities between mortgagees and lien claimants EFFECTIVELY MANAGING THE FINANCING Effective management of the financing can either make or break a construction project. Most risks and potential difficulties that arise in construction financing come from the actual project management and cash flow management of the project itself. This session will examine the steps you can take to ensure that the financing is managed effectively and efficiently. • Ensuring that you have the required capital in place on a timely basis • Taking proper steps to deploy the capital when required • Controls put in the proposed financing to address risks • Tools for creating a well thought out and documented construction budget • Staying on top of lender requirements throughout the project • Allowing for a reasonable contingency allowance KEY ISSUES IN MEZZANINE FINANCING Mezzanine financing is now an integral part of construction financing for developers & builders. This session will examine this non-traditional source of capital and the key role it can play in your next venture. • Latest mezzanine and high-ratio financing vehicles: who is actively providing this type of financing and how it is priced • Pros & cons: mezzanine vs. other financing options • Interim financing best practices: minimizing risk MANAGING RISK AND PERFORMING APPROPRIATE DUE DILIGENCE There is a need for all members of a large P3 consortium to clearly understand the risks each party retains through the contract. This session will cover the process that various members of large P3 consortium follow; typical risks; how these issues are resolved in the standard P3 structure; how to ensure full due diligence; and a contingency approach to price the works. • Typical P3 organization structure • Various legal agreements that require appropriate due diligence reviews • Standard ‘go / no go’ provisions for contractors on P3 projects • Standard legal review checklists • Different approaches to dealing with owners on risk transfer • Typical contingency pricing method adopted by contractors WORKSHOP FINANCING, PROCUREMENT OPTIONS & RISK SHARING Value for money is maximized through choosing the optimal procurement method and risk allocation. This workshop will examine financing considerations associated with procurement options and risk sharing decisions. • Impact of choice of procurement options on financing • Allocating risk to the party best able to manage that risk • Reducing individual risk premiums and the overall cost of the project • Real life solutions to risk allocation • How different procurement options transfer similar risks
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