CRD McLoughlin Point Wastewater Treatment Plant

Construction

The McLoughlin Point Wastewater Treatment Plant provides tertiary treatment for wastewater from the core area municipalities of Victoria, Esquimalt, Saanich, Oak Bay, View Royal, Langford, and Colwood and the Esquimalt and Songhees Nations. Work at the facility began in 2017 by Harbour Resource Partners, a joint venture between Graham and AECOM. The plant is the main component of a CAD$775 million wastewater program undertaken by the Capital Regional District.

The plant can treat 108 megalitres of wastewater per day to a tertiary level – one of the highest levels of treatment available – leading to cleaner ocean waters in and around the south coast of British Columbia and northern Washington state.

Financing

In 2014, Graham Capital, as part of a consortium was named as the preferred proponent by the CRD for the McLoughlin Wastewater Treatment Plant Project. However, the project was subsequently suspended due to the Township of Esquimalt’s denial of a zoning variance requested for the original proposal. In September 2016, CRD moved forward with the existing preferred proponent to develop a tertiary wastewater treatment facility at the original location. Graham Capital, as the Co-Developer and Financial Advisor to the consortium, was able to leverage their relationship with the lenders who provided committed financing on the original proposal, to recommit to the project three years later and at the originally agreed margins and fees.

This required the management of detailed due diligence and updating of original reports from the Lenders Advisors to reflect the modified plant and updated pricing. It culminated in both lenders executing commitments to the consortium on the same terms as agreed to in 2014. The lenders’ strong relationship with Graham, their balance sheet, and ability to successfully resource and perform the contracted work was a significant factor in their acceptance of committing to the original financing terms. The lenders’ willingness to recommit to the project on the basis of the original financing proposal was key to the CRD Board’s decision to proceed with the preferred proponent on the McLoughlin Point site.

Graham Capital’s multifaceted role included assessing commercial risk, reviewing and revising project documents, actively managing the lenders’ due diligence process, conducting an efficient funding competition, and leading the preferred proponent throughout the bid process.