Case Studies: The Hague New Train Central Station

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Project Overview
The Hague.png
Figure 1: The Hague New Central Train Station, The Netherlands
The Hague New Train Central Station
Project Type: Brownfield
Type of Project Financing: Public
Contract duration: 38 Months
Budget:

Rail Station Construction: 110 EURO million (2010) only for construction of the rail station.

Rail Station Construction and Urban Regeneration: 172 EURO million (2015)
Project Time Line
2001: the national government and municipality took the initiative
2003: the national government approved the plans for a new central station in the Hague
2004: Call for tendering of construction contract
2007: Preparatory works for the new train station started
2010: Contract award
2011: Official start of the construction of the terminal
Spring 2015: New public transport infrastructure is officially opened


Introduction

The Hague New Train Central Station project consists of the redevelopment of the old train station and the area surrounding this. The new station design is expected to serve a future demand of 350,000 passengers a day by 2020. The redevelopment works will not only improve the transport service, but also provide a renovated area, which includes new offices, stores and residential houses. The redeveloped area concerns an area of 160,000 square meters (m2). Furthermore, the project will also contribute to the development and integration of city landmarks, such as the National Archive, the National Library and the Literature Museum. The train station is an end node of the Dutch railway network. However, it is a critical node for transportation in the city. Tram and bus services are part of the train station. All these project features reveal the exclusive nature of the project in terms of market competition of infrastructure in the region.


The Contracting Authority (Public Party)

On behalf of the municipality of The Hague, ProRail is the contracting authority. Prorail is a government agency which maintains and builds the national railway network infrastructure, provides rail capacity and traffic control).

In 2013, ProRail invested 1.2 EURO billion in rail and stations’ infrastructure. The municipality of Hague budget in 2013 for Public Open Space management and development as well as Transport was 25 EURO million. This shows the importance of the contracting authority party.

In 2003, the national government approved the plans for a new central station in the Hague after an initiative taken by two parties (national government and municipality) in 2001.

It should be noted that for the renovation of the train station the Ministry of Infrastructure and Environment and the Nederlandse Spoorwegen, NS were also involved and are relevant stakeholders. The Nederlandse Spoorwegen, NS is a State owned company in charge of the operation of Dutch railways.


Sources of Financing

The project is funded by two government agencies:

  • The Ministry of Infrastructure and the Environment (earlier Ministry of Transport, Public Works and Water Management) providing funds for the construction of the train terminal (approx.117 million EURO).
  • The Ministry of Housing, Spatial Planning and the Environment (now Ministry of Infrastructure and the Environment) providing funds for the urban, space and housing development (approx. 49 million EURO).


Users

The new infrastructure is expected to serve individual passengers. Currently 150,000 passengers use the station daily. By 2020, the forecast is that 350,000 passengers will use the station daily. The renovated area, which includes offices, stores and houses is transit to 35,000 people a day.


Key Purpose for Public Financing Model Selection

Due to a significant modification of the scope of the works and the withdrawal of one tender, the tendering process initially oriented to award a design and construction contract failed. The tendering process was resumed towards a standard construction contract. This project was never considered for private financing or co-financing through Public Private Partnership delivery models.


Project Timing

The socio-economic developments within the project planning /construction time can be reflected in the following indexes variations. The per capita GDP variation before 2008 kept increasing. After 2008, GDP decreased in the region. The contract was awarded in 2010. Following a period of four years, which started in 2005 and was characterized by decreasing unemployment rates, the unemployment rate increased after the year of contract award.

Project Locality and Market Geography

The project is urban in its nature. The train station is an end node of the Dutch railway network, and a critical node for transportation in the city of The Hague. The train station is a hub for tram and bus services. In addition, the population density has been increasing since 2008 (two years before contract award), while industrialization, which can be reflected in industry fixed asset investments, increased soon after 2010 (year of the contract award).

Procurement & Contractual Structure

In 2010, the contracting authority awarded a Construction contract for this project. The rail infrastructure attached to the project is maintained by ProRail through outsourcing. The Nederlandse Spoorwegen (NS) is responsible for the operation, while certain activities are also outsourced.

Tendering

The project contract was awarded through a Competitive Dialogue procurement. Three bidders participated in the tendering process, which lasted nine months.

Contract Structure

The payments regime was agreed on the basis of a lump sum. The agreed duration of the contract was 38 months.


Risk Allocation

The contracting authority awarded two contracts. One for the design and another for construction of the central station. This is reflected in the allocation of risks for the project, which is as shown in Figure 2.

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Figure 2: Risk allocation

Performance

According to the management of the project, reliability, availability and safety will be likely improved in line with project expectations. The same can be expected for the maintainability and security. Some evidence indicates that more than 50% of end users are very satisfied. There were no cost overruns for this project, but there were additional investments due to changes of design, complementary works and changes of pricing regulations. Yet, a delay in completion of works of 1.5 years occurred. Two claims were filed due to situations related to design changes and changes of prices.

Project Outcomes

The perceived general level of project success is high according to the management of the construction of the rail station that invokes as a critical success factor the sound risk management, which involved the management of the many stakeholders who took part in the project. Although the project had been resourced with funds with some flexibility, the key factor was adoptingcost-efficiency principles in the allocation of resources. However, there were some difficulties such as communication issues, lack of coordination with and among subcontractors, which was made worse by the continuous mobility of the subcontrators’ workers. To address these issues, the management of the construction (client) had to establish direct communication with the subcontractors.

The main project purpose for the contracting authority was relieving congestion. The capacity that can be already delivered is 350,000 passengers a day. The redevelopment of the station is the product of preventative planning, rather than a response to an existing problem in the station.

Economic impact

Large positive socio-economic impacts are expected since the project was conceived as a means to overcome an economic crisis, as well as to trigger additional investments in the area.

Social Impact

The main social impact is related to the redevelopment of the centre of The Hague city, which not only includes development of business, but also the enhancement of some deprived areas in the vicinity of the railway station.

Environmental Impact

The redevelopment of the station and the area surrounding thereof will contribute to promoting an increased use of the train, which will likely lead to a reduction of local pollution in the area. This is also possible due to a more optimal coupling with other transport modes also operating in the station, such as the tram, buses and private cars.

References

The initial version of this wiki page has been produced within the framework of the BENEFIT project has received funding from the European Union's Horizon 2020 research and innovation programme under grant agreement No 635973

  • www.denhaagnieuwcentraal.nl/home/
  • www.strukton.nl/projecten/ov-terminal-den-haag/
  • www.infrasite.nl/projects/project.php?ID_projecten=928
  • www.rijksoverheid.nl/onderwerpen/ruimtelijke-ordening-en-gebiedsontwikkeling/meerjarenprogramma-infrastructuur-ruimte-en-transport-mirt
  • www.cbs.nl/