EBRD, Canada’s EDC and US’s OPIC finance hospital in northwest Turkey

ISTANBUL

The European Bank for Reconstruction and Development (EBRD), the Export Development Canada (EDC) and the Overseas Private Investment Corporation (OPIC), the U.S. government’s development finance institution, are set to co-finance the development of a 375.75 million euro high-tech hospital in the northwestern Turkish province of Kocaeli.

In a written statement on Nov. 8, the EBRD, the EDC and the OPIC said the hospital will be designed, built, equipped and managed by the private developer Kocaeli Hastane Yatırım and Sağlık Hizmetleri A.Ş, a joint venture between global industrial company GE and Turkish corporations GAMA Holding A.Ş. and Türkerler İnşaat. 

Faced with the need for large investments, the Turkish government is seeking to engage private sector resources and know-how to construct and manage infrastructure facilities more quickly and efficiently. 

The new health complex will span several buildings and have a total of 1,180 beds, providing better hospital facilities for the province, according to the statement.

Under a 28-year concession, the buildings will be leased to the Turkish Health Ministry. The private developer will act as facilities manager, providing building maintenance and non-clinical services, while medical services will remain the remit of the Health Ministry. 

The hospital is expected to become operational in 2019, according to the statement. 

“As part of the financing package, the EBRD has arranged a 62.7 million euro syndicated loan under its A/B loan structure, with 20 million euros for the Bank’s own account and 42.7 million euros syndicated to UniCredit S.p.A., the Industrial and Commercial Bank of China Ltd Dubai Branch, and Intesa Sanpaolo S.p.A. OPIC of the United States and EDC of Canada are providing parallel financing of $220 million and 55 million euros, respectively,” said the statement.

Last month, Turkish President Recep Tayyip Erdoğan hailed the comprehensive long-term financing for Kocaeli and İzmir hospital public-private partnership projects involving the same group of lenders. 

Erdoğan described the program to build or expand hospitals as an outstanding example of cooperation between private and public sectors. 

The EBRD has financed five hospital projects under the program and has also been working closely with the Turkish Health Ministry over the past four years to enable greater private sector involvement in the hospital sector.