Bell Gully advised Crown Infrastructure Partners (CIP) on the development and implementation of a new funding model recently announced by the Government at Fulton Hogan's Milldale development, north of Auckland. Work on the project commenced in early 2018 and reached financial close last month.

Bell Gully advised CIP on the development of a structure that would allow for an efficient and equitable funding model for the development of bulk housing infrastructure within the current legislative framework. This led to the development of the encumbrance model utilised for the initial project.

Bell Gully worked closely with CIP and CIP's commercial, financial and tax advisers in developing, negotiating and documenting the commercial and financing documents for the project.

Bell Gully also advised CIP on its senior debt procurement process, which resulted in CIP securing long-term fixed-rate debt from Accident Compensation Corporation. A CIP-owned SPV will obtain financing from Accident Compensation Corporation, with CIP contributing a portion of equity. The SPV will in turn provide financing to assist Fulton Hogan Land Development to meet the costs of certain roading and water infrastructure for its Milldale development.

The SPV financing will be repaid over time, partly by Fulton Hogan Land Development and partly by section owners, by way of an 'infrastructure payment' collected with Council rates bills. This new model creates an efficient means to raise long term debt to be utilised for the building of large scale infrastructure.

The Bell Gully team advising on the transaction was led by Bell Gully partners Hugh Kettle, Anna Buchly and Simon Watt, senior associate Lauren Whitehead and solicitors Mathew Brown and Ella Darroch.​

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