Article extracted from ProjectFinance:

:: Hospital de Mostoles closed at a time of uncertainty in the financing market for PPP projects in Spain. That it could obtain 20-year commercial bank debt was an important milestone for the country’s healthcare sector, especially since the project entailed the financing of a hospital under a PPP structure, while also incorporating medical risk.

Under the PPP contract the risks attached to both the operations and maintenance of the building and the provision of medical services have to be allocated under a single concession agreement. By splitting the project into two different companies, ring-fencing the medical risk from the pure O&M, the sponsor was able to close the project without offering a full completion guarantee. Explains Mario Mendez, director of project finance for Spain & Portugal at BNP Paribas: “In Spain, infrastructure concessions usually have full completion guarantees provided by the sponsor”. ::

See Diadro’s project: Demand Study for the New Hospital of Mostoles.