Public-Private Partnership in Urban Redevelopment, Quo Vadis?
Where does it go?
Working together for now or living together for
better and worse?
by Erik Jan Kleingeld
Key words: Public Private Partnership, Urban Regeneration, Area
In the Working Group Urban Regeneration of Commission 8, often
projects have been discussed in which Public Private Partnership
played an important role. Once introduced as a miraculous medicine for
dead locks in inner city projects, now this principle is put in to
practice widely. And the first opponents are standing up and the first
doubts are being heard.
In this lecture, Erik Jan Kleingeld, project manager with Seinpost
Adviesbureau, a Dutch consultancy firm on inner city problems, looks
for clues. At first he will illustrate the present discussion.
Secondly, he analyses the background and work out some different
formulas for public private partnership. Next, he will take his
position in the discussion and come to a conclusion that puts the
future of public private partnership in a new light.
1. The History of Public Private Partnership
Public Private Partnership was invented as a new principle when the
building projects became more complex. In the city, this was the
moment the inner city (re)developments had more often a
multi-functional programme (for instance shopping malls combined with
residential buildings). A second field of implementation was the urban
regeneration, where the private parties often delivered the creativity
and the commercial impulse the neighbourhoods needed. The third origin
of the public private cooperation is where the private developer had
to be willing to cooperate in a partnership with the city to be
considered as the party for profitable developments.
In this way, a wide variety of forms of public private partnership
have been put into practice, always meeting the definition of Mc Nulty,
ppp being a sustained collaborative effort between the public and
private sectors, in whic each contributes to the planning and
resources needed to accomplish a mutually shared objective.
Most recently the trend of Community Investment meant a new impulse
to public private partnership. This is where the commercial
organisations like to earn a socially correct reputation and therefore
seek a way to invest in socially week neighbourhoods. With such
investments, cooperation with the public sector often is inevitable.
2. Criticism to Public Private Partnership
Introduced as a miraculous medicine, after years of practice in
different projects public private partnership is faced now with criticism.
And in different projects the parties now have ended their
partnership, accusing each other of breaking the commitment to the mutually
shared objective. In the lecture some examples will be given. The
parties fall back to their original role: the public sector makes the
plans and sets the regulations, the private parties either wait for
the opportunity to play their role as a developer, or play their role
as owner or user. They tell each other: you do your job, we do ours.
Also to be described as the effort of both the public sector as the
private sector as well to pursue their own objectives .
This will not mean that parties do not cooperate. But cooperation
and partnership are different concepts.
3. Different Formulas of Public Private Partnership
As I stated, a wide variety of partnerships have come into
practice. In this lecture they will not be classified according to
their legal structure of organisation. The differences in goal, or, the
mutually shared objective, will be the factor of discrimination. I
want to illustrate these differences by the two different approaches,
implemented in the regeneration of two streets. One is the Witte de
Withstraat in Rotterdam, the Netherlands, where the Neighbourhood
Development Cooperation plays the coordinating role in the radical
intervention that is being carried out. The other street is the
Ostenfelderstrasse in Bottrop, Germany, in which a not much less
drastic project is being carried out.
An important factor in the partnership is the mutually shared
objective. The most successful approach is often that the more the
objective is aimed on the long-term, the more integrated the
partnership is organised. On the realisation of a specific project,
parties can cooperate, or even put up an common organisation, but the
partners will not be sharing a problem really. The management-oriented
organisation, or process-organisation, is more complex, often
integrating the participating parties, and has more decisive power
itself, compared to the project-organisation. The first form is
clearly more a partnership, a contract between parties with mutual risks,
and mutual benefits. The latter one is more a temporary relationship,
working together for now, but the split up is often already planned at
4. Critical Factors
We have seen different forms of partnerships, successful and unsuccessful.
The unsuccessful projects cause reactions of criticism. Often the
cause of the lack of success is the misinterpretation of the
difference between a project and a process.
Regarding Community Investment initiatives, it is also important
both parties make the decision either to focus on some specific
projects, or to strive after a cooperation for the long term. Cities,
eager to attract private investments, often have more long term
expectations than the commercial enterprises do intend. But these
private parties do have to realise that neighbourhood investments by
definition have a long term horizon, otherwise their effort is not
much more than an other well fare action.
The worst thing to happen is that the only thing the public and the
private parties get out of their mutual initiative, is an (other)
frustrating experience. And that is the last the most needing
neighbourhoods are waiting for.
ir. Erik Jan Kleingeld
Seinpost Adviesbureau B.V.
NL-3071 JP Rotterdam