The JPY 163 billion financial closure of the İkitelli City Hospital project, a Public-Private Partnership to be developed by Renaissance Healthcare Investment and Japanese Sojitz, was completed with a ceremony at Çırağan Palace.
The project is financed by eight global finance institutions, including Japanese state bank the Bank for International Corporation (JBIC), Nippon Export and Investment Insurance (NEXI), Sumitomo Mitsui Banking Corporation (SMBC), Bank of Tokyo-Mitsubishi (BTMU), Nippon Life Insurance Company, Dai-ichi Life Insurance Company, The Iyo Bank, and Standard Chartered Bank.
Set to become one of the world’s largest hospitals with a projected bed capacity of 2,700, the Ikitelli City Hospital will create near 10 thousand jobs once opened to service.
Sitting on a construction area of over 1 million m2, once completed, the Ikitelli City Hospital will be the world’s largest seismically isolated building with over 2,000 seismic isolators. This will allow the hospital to continue its operations at maximum capacity even during and after an earthquake.
Financial closure ceremony was held at Çırağan Palace for the İkitelli City Hospital project to be developed by Renaissance Healthcare Investment, one of Turkey’s prominent healthcare investors, and Japanese Sojitz, a leading Japanese investment and trade company.
The financial closure ceremony hosted by Dr. Erman Ilıcak, and Kamil Yanıkömeroğlu, Chairman of Renaissance Healthcare Investment, saw participation of senior representatives from Sojitz, the Japanese partner with 30 percent stake in the project; Japan Bank for International Cooperation (JBIC), main lender; NEXI, government agency insuring lenders as well as Japanese lenders SMBC, BTMU, DAİ-İCHİ, NİSSAY, SCB and IYO BANK. A loan of JPY 163 billion will be secured for the Istanbul Ikitelli City Hospital, which will have a total investment value of JPY 203 billion.
Once completed, Istanbul Ikitelli City Hospital will be able to serve 23,600 patients per day with a bed capacity of 2,700. Spanning over a 1 million m2 construction area, the city hospital will come to be one of the world’s healthcare facilities. Equipped with a seismic isolation system, which is recognized as the most efficient technology for load transfer in buildings, the hospital will be able to continue its regular operations even during an earthquake. Operations will not cease even during and after an earthquake.
More than 2,000 seismic isolators will be installed at the Ikitelli City Hospital, which, once finished, will be world’s largest building rigged with seismic isolators. In conclusion, as reports the Engineering News Record magazine, the Ikitelli City Hospital will far outperform Renaissance Healthcare Investment’s Adana City Hospital Project, the current leader in this area. Due for opening in 2020, the Ikitelli City Hospital Project will generate direct employment for around 6 thousand during construction and 10 thousand once brought into service.
USD 4.3 BILLION HEALTHCARE INVESTMENT BY 2020
In a statement on this massive project, Kamil Yanıkömeroğlu, Chairman of Renaissance Healthcare Investment, said: “Today marks the first step of the construction of the world’s largest hospitals, with an investment worth JPY 203 billion. The fact that Sojitz, our Japanese business partner, and other institutional investors are committed to an 18-year investment of such magnitude at the Ikitelli City Hospital, proves, first and foremost, their confidence in our robust national economy and Rönesans Holding’s global experience in this field.”
“Typical of all our healthcare investments, this project will employ cutting-edge technology and safety measures, in particular against the high earthquake risk in Istanbul. Building this project, we will use a technology that will allow for uninterrupted surgeries even during an earthquake. We will introduce to Turkey the latest Japanese advances in construction, medical equipment and medical service technologies, and use them in our project,” noted Yanıkömeroğlu and went on with his remarks: “At Renaissance Healthcare Investment, by 2020, we intend to invest 4.3 billion, funded via a Public-Private Partnership model, in development of a 9,500-bed healthcare facility that covers a construction area of 3,200,000 m². In January, we opened Yozgat City Hospital for public use and for the operations of the Ministry of Health, with participation of Prime Minister. We hope to inaugurate Adana City Hospital in mid-September. We value very highly the support of our Japanese partner and Japanese banks provided for the Ikitelli project. All of the four hospital projects we have financed to date were the result product of collaboration with foreign development banks and foreign commercial bank groups. In 2014, Adana emerged as the first example of this kind. Ikitelli also features firsts. This is Turkey’s first social infrastructure project that involves JBIC and NEXI, two publicly-owned Japanese giants. Unlike their previous investments in Turkey, which were relatively short-term and low-budget projects, for this project, they provided enormous support with 18-year term and high investment amounts. Among the lending institutions are Nissay and Dai-ichi, Japan’s leading and second largest insurance providers respectively, which never funded a project abroad, let alone in Turkey. Once again, Japanese giants SMBC and BTMU, our loyal supporters, contributed in our project, this time with much higher figures. A global bank, with no previous involvement in this type of projects in our country, made its first investment in Turkey, as well. All these facts represent the trust in our country, our projects, and us; looking ahead, we hope to continue to make investments in partnership with foreign banks and foreign investors.”
MAJOR THRESHOLD IN TURKISH-JAPANESE COOPERATION
Tadashi Maeda, Executive Director and CEO of JBIC, shared his views: “We are proud to take the lead in financing such an important infrastructure project.” Maeda continued: “Istanbul Ikitelli City Hospital, an infrastructure project of major importance to Turkish people, marks a strategic threshold with regard to Turkish-Japanese cooperation. Turkish government laid out a highly robust Public-Private Partnership model, adopting a bank perspective. Both of the sponsors, the Turkish Rönesans and the Japanese Sojitz, are excellent companies, therefore, we are certain that they would successfully implement this project in cooperation with Turkish government.
SET TO WRITE ITS NAME AMONG THE WORLD’S “BESTS”
Renaissance Healthcare Investment (RSY) does not gear down in PPP projects launched to provide Turkey with plenty of modern hospitals as part of the “Health Transformation Program”, which has been deemed Turkey’s largest healthcare program to date.
With Istanbul Ikitelli City Hospital, a RSY project, the purpose is to cater for the healthcare needs of a mega city such as Istanbul through bed capacity, size, state-of-the-art technology, and seismic isolation.
The project, covering a construction area over 1 million m2, will serve 23,600 patients per day with a total of 2,682 bed capacity. The project, with a proposed groundbreaking date of October 1st and a planned delivery in 36 months, will be one of the world’s largest hospitals. It will create around 6,000 jobs during construction alone, and employ 10,000 once it goes operational.
The hospital will stand out with its advanced technology and equipment, including the Da Vinci Surgical System present only in a limited number of healthcare facilities in Turkey. It will also rank among a handful of institutions that feature the state-of-the-art radiation oncology technologies such as Cyberknife and Thomotherapy as well as Hybrid MRI Operating Rooms that enable radiological imaging during surgery.
This PPP model involves private entities undertaking the development of public investments and then leasing them to the government for 25 years. During this lease term, private institutions are also responsible for delivering certain public services. Medical services, and staffing, will be provided by the state as well. In this partnership model, projects from around the world are typically scheduled for 15 to 30 years, and the period set in Turkey is 25 years.