黑洞社区

The Ministry of Defence鈥檚 move to bring on board a private sector partner to manage its estate is the 鈥渒ey reason鈥� for placing the procurement of up to 拢5bn worth of construction contracts on hold, 黑洞社区 understands.

As revealed in 黑洞社区 last week, the MoD鈥檚 property arm, the Defence Infrastructure Organisation (DIO), has placed its entire New Generation Estate Contract (NGEC) procurement 鈥渦nder review鈥�, meaning no contracts will be let this year.

锘縏hey want the strategic partner in place before going forward with procurement

Source close to MoD

An industry insider close to the DIO said the move had been prompted by the organisation鈥檚 decision to bring a private sector partner in to manage the defence estate, worth nearly 拢20bn and including about 4,000 sites.

鈥淭hey want to get the strategic partner in place before going forward with the procurement, so they鈥檝e stopped the bus,鈥� the source said.

Earlier this month the DIO issued a formal call for private sector partners to register an interest in managing the estate.

The deadline for initial expressions of interest passed on 16 January and 黑洞社区 has been told the DIO has been 鈥渂esieged鈥� with responses.

A senior figure at one firm who has expressed an interest said, 鈥渂ig names鈥� such as Serco, Capita Symonds, Babcock and Sodexo had all responded to the DIO鈥檚 invitation. Other firms said to be interested include Telereal Trillium, Interserve, Carillion, Land Securities, and GVA Grimley.

The private sector partner is not expected to be appointed until at least the end of the year, meaning procurement on the NGEC is likely to be delayed well into 2013.
The DIO has now extended all its capital works contracts by one to two years in order to accommodate the delay.