Canadian Health Care P3s: Robust Performance And Risk Mitigation Outweigh Challenges

S&P Global Ratings rates 30 Canadian public-private partnership (P3) projects, including 11 health care P3s with construction and operations and/or maintenance risk, totaling ~C$ 3.7 billion of debt. Of our portfolio in Canada, 73% has an 'A' category rating and just two ratings are on negative outlook. At S&P Global Ratings we analyze the creditworthiness of health care P3 projects using our "Project Finance Framework Methodology," published Sept. 16, 2014, and "Key Credit Factors For Social Infrastructure, Accommodation, And Entertainment Project Financings," published Sept. 16, 2014. All health care P3s in our portfolio are availability-based and now operational. Compared to other infrastructure asset types, availability-based social infrastructure projects tend to have a stable rating performance. A 2021 study on Annual

... have played an important role in delivering Canadian health care infrastructure with C$19.24 billion invested in 49 projects with construction and operations and/or maintenance risk. - The performance of S&P Global Ratings' rated health care P3 portfolio has been robust and shown that risk-transfer mechanisms have generally worked. However, there have been performance-related hiccups on certain health care P3s and counterparty creditworthiness remains key to project rating. - During operation, ramp-up and size of facilities are critical for the facilities' performance. Maintaining appropriate temperature/humidity and availability of elevators are common operation challenges faced by hospital projects. Effective lifecycle management over the life of the concession is key as these facilities age. S&P Global Ratings rates 30 Canadian public-private partnership (P3) projects, including 11 health care P3s with construction and operations and/or...

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