Do we really need the F in DB(F)MO? An empirical study into the substitutes of the F component in Dutch DBMO building projects and the effects on added value

Do we really need the F in DB(F)MO? An empirical study into the substitutes of the F component in Dutch DBMO building projects and the effects on added value

Van den Assem, S.C.E.

Chao-Duivis, M.A.B. (mentor)
Wamelink, J.W.F. (mentor)
De Jong, W.M. (mentor)
Aalbers, S. (mentor)
Gotink, I. (mentor)

Civil Engineering and Geosciences

Structural Engineering

2014-08-18

Due to the difficulties around the F component, it recently appears that more attention has been paid to exploring the alternatives of bank financing. New forms of integrated contracts are gradually being developed that are funded by public resources, but are directed at producing comparable incentives as produced by the F component. In addition, practice shows that additional measures are built in DBM(O) agreements producing comparable incentives, while simultaneously avoiding the complications of private financing. While new practical experiences have shown that the F component is more often excluded from the contract and that supplementary arrangements are built in the DBMO agreement, it has been noticed that the theoretical knowledge is way behind. In view of these new practical movements, this research is aimed at a better understanding of the mechanisms underlying the role of the F component in DBFMO as well as how the role of the F component can be rebuilt in DBMO without the actual use of private financing. Moreover, as the prevailing view seems to be that DBFMO projects provide real incentives that express themselves in added value, this research will also go deeper into the question whether the same level of added value as under a DBFMO structure can be generated, once the F component is removed from the contract. Based on extensive case study research, nine measures are developed to overcome the absence of the F component in DBMO projects. In addition to the measures proposed, it has been found that leaving the F component out of the building contract has five significant implications for the level of added value. These implications are: (1) transaction cost savings; (2) financial cost savings; (3) reduced size of life cycle optimisations; (4) enhanced probability of time overruns, and; (5) improved service quality.

DBFMO
DBMO
PPP
project finance
added value

http://resolver.tudelft.nl/uuid:5ee6b46e-7ab9-497c-b319-7b3ae0b43cd4

Student theses

master thesis

(c) 2014 Van den Assem, S.C.E.