1. Johnson Controls
  2. Sustainable Infrastructure
  3. Public-Private Partnerships

Public-Private Partnerships

Contact Us

Make our award-winning P3 experts part of your team

Deliver public infrastructure by leveraging private sector expertise and performance guarantees—while maintaining public ownership. Public private partnerships (P3s) steward taxpayer dollars through long term contracts that deliver high performing facilities, predictable costs, and measurable outcomes, creating enduring value and certainty for public entities and taxpayers over decades.

Johnson Controls is a leading P3 partner in North America, specializing in the long term operation and maintenance of buildings and systems across the full project lifecycle.

What are public private partnerships?

A public‑private partnership (P3) is a long‑term procurement and contracting model that allows a public entity to partner with the private sector to deliver infrastructure and related services for public benefit. Under a P3, a public owner enters into a multi‑decade agreement with a private‑sector team typically including developers, design‑builders, financiers, and operators to design, build, finance, operate, and maintain facilities or systems.

Common characteristics of P3s include:
  • Risk transfer from the public agency to the private partner across design, construction, operations, and performance.
  • Long-term contracts, often spanning 20–50 years.
  • Budget certainty, with defined costs for operations, maintenance, lifecycle renewal, and energy performance.
  • Performance guarantees, measured against agreed‑upon measured Key Performance Indicators with financial penalties for performance failures.

P3s are used across a wide range of infrastructure, including government buildings, schools, universities, hospitals, airports, and water systems. P3 is a delivery and contracting mechanism that enables outcomes such as Buildings‑as‑a‑Service (BaaS) or Energy‑as‑a‑Service (EaaS) within legislatively defined risk‑transfer frameworks. Common P3 structures include consortium models, integrated models, and availability‑based concession agreements.

P3

How public private partnerships work

Here’s a high-level view of a typical Public Private Partnership (P3) process using the design build finance operate maintain (DBFOM) model.
Value For Money assessment
An independent business case analysis compares the cost of delivering the project through traditional public delivery versus partnering with the private sector, helping determine the most cost effective and best value approach.
Procurement
A stringent two step procurement process qualifies private-sector teams and invites proponents to submit proposals, which are used to select the solution that meets the required specification and offers the best overall value: lowest Net Present Value (NPV) including all costs of Design-Build-Finance-Maintain over the agreed term.
Financial close
Once a preferred partner is selected, detailed contracts and financial arrangements are finalized. Private capital is secured, and the project moves forward. Scheduled payments start only after Substantial Completion, ensuring no out-of-pocket payments are made before the facility is available for use.
Design and construction
The private-sector team works closely with the public entity and assumes responsibility for design and construction, integrating decisions that optimize both upfront costs and longterm operational efficiency
Operations and maintenance
Experienced private operators manage and maintain the facility or system throughout the term of the agreement, continuously optimizing performance and reliability. At the end of the term, assets are returned to the public entity in a defined condition evaluated by a mutually agreed condition engineer.
Performance obligations
Private-sector teams face KPI-based financial penalties for non-performance, with the public agency able to apply escalating deductions until performance standards are met.

Why choose Johnson Controls Sustainable Infrastructure team

Johnson Controls experts can step you through the benefits of a public-private partnership for your project. Here’s a quick overview.

Risk transfer

The risks of construction obstacles, project delays, operational challenges and long-term maintenance issues are owned by the private-sector partners with deductions for noncompliance.

Reliable project delivery

Delivering on time and on-budget is contractually guaranteed. The private-sector team meets project deadlines and can often accelerate delivery through procurement and delivery best practices.

Staff management

Recruiting, training and staff oversight are the complete responsibility of the private-sector team.

Budget certainty

The public agency’s costs are predictable over the project term. What’s more, the private-sector team continually optimizes asset performance, for the greatest lifecycle value.

Long term performance guarantees

The partnership uses innovative solutions to deliver specified outcomes over 20, 30 or even 50 years. Partners have financial incentives for meeting the Key Performance Indicators (KPIs).

Asset handback assurance

The public sector agency retains ownership of the assets, which the private-sector team will handback in a pre-determined condition at the end of the term, evaluated by a mutually agreed-upon third party.

P3 applications by sector

Higher Education
Higher education
Improve campus efficiency while enhancing student and staff comfort and productivity.
  • Central utility plants
  • Research facilities
  • Student housing
Helathcare
Healthcare
Expand, renovate or build new acute care hospitals and other mission-critical facilities to enhance care.   
  • Central utility plants
  • Distributed energy assets
View case study
Government buildings
Government buildings
Attract and retain residents and businesses with efficient, secure, comfortable buildings.
  • Civic buildings
  • Courthouses
  • Detention facilities
  • Public health facilities
Public Housing
Living Spaces
Better serve residents while enhancing comfort and efficiency.
  • Energy efficient HVAC
  • Renewable energy
  • Lifecycle maintenance
View case study

Build on our expertise for your P3 project

Johnson Controls brings you key advantages to make your P3 project a success across its lifecycle.

  • 20+ years of P3 experience: We’ve helped clients across government, healthcare and education succeed.
  • 50+ sites under management since 2004 as part of P3 projects.
  • Technical expertise in building system operations and maintenance. Johnson Controls is knowledgeable in the built environment and a leader in related technologies.
  • A long-term partnership focus: We do more than provide equipment. We’re your partner, bringing the resources of a global leader to achieve the results you need and expect.
  • Financial strength: Johnson Controls Capital has funded more than $6B in customer projects worldwide.

FAQs about public private partnerships

  • When should you consider a public-private partnership?
    Strong P3 candidates typically share the following characteristics:
    • Large, complex infrastructure investment: New-build or major renovation projects with a total construction value of $50 million or more, where design, construction, financing, and long-term operations must be tightly coordinated to manage cost, schedule, and performance risk.
    • Need for long-term operational and facilities expertise: A desire to leverage private-sector capabilities for operations, maintenance, lifecycle replacement, and facilities management not just construction over the full asset lifecycle.
    • Preference for simplified governance and accountability: A desire to work with a small, integrated group of accountable partners, reducing the burden of managing multiple vendors and interfaces while ensuring single point responsibility for delivery and long term performance.
    • Intentional transfer of performance risk: Interest in shifting financial, technical, and operational risk to a private partner that is contractually accountable for outcomes, with performance guarantees and financial deductions tied to availability, condition, energy performance, or other KPIs.
  • Who owns the assets in a P3?

    The facilities and infrastructure built through a P3 remain publicly owned and controlled. This project delivery model does not involve privatization of assets.

  • How do P3 projects avoid delays and cost overruns?

    A P3 allocates risks and responsibilities based on each participant’s expertise. And private sector partners typically face penalties if they don’t meet deadlines or achieve contracted outcomes. That creates a compelling incentive to complete the project on time and within budget, delivering the results expected. Unlike a traditional design-bid-build approach, in P3’s the design, construction and operations partners are integrated throughout the design process which facilitates a faster design and construction process.

  • How can a P3 guarantee results?
    The private-sector team brings together designers, engineers, contractors and operators to deliver better-designed and better-maintained facilities, using the right technology and solutions to optimize performance. Outcomes expected for the project term, typically 20 to 50 years, are specified up front; if outcomes aren’t met, payments are reduced accordingly.
  • Which U.S. states allow P3 projects?
    The Design-Build Institute of America (DBIA) says 36 states, plus Washington, D.C. and Puerto Rico, have enacted enabling legislation for P3s, supporting not only roads and bridges but also social infrastructure projects including civic buildings, detention facilities, energy facilities, student housing and research facilities.

Additional industry specific resources

Association for the Improvement of American Infrastructure (AIAI)

Explore additional Sustainable Infrastructure solutions

EaaS

Energy as a Service

Have our team take on the responsibilities and the risks for complex building systems, with full-term contracted KPIs.

EPC

Energy performance contracting

Update your facilities using little to no upfront capital, and pay for the improvements with guaranteed energy and operational savings.

Getting started with P3

Johnson Controls Sustainable Infrastructure starts every project by listening. Our initial consultation focuses on clarifying your needs, challenges and desired outcomes. Contact us to learn more about next steps.

Please read our Privacy Notice for information on how we protect and manage your personal data. By completing this form and submitting your information, you confirm that you have reviewed, understood and accepted our privacy terms as well as our cookie terms.