SHA Analytics, LLC

SHA Analytics, LLC served as part of the financial advisory team to Los Angeles World Airports (LAWA) for its Automated People Mover (APM) project. This new 2.5-mile people mover is part of the Landside Access Modernization Program at Los Angeles International Airport (LAX). The APM project is being delivered through a Public-Private Partnership (P3) using the Design-Build-Finance-Operate-Maintain (DBFOM) procurement model, with an overall contract value of $4.9 billion over a 30-year contract, of which approximately $2 billion is for initial design and construction to get the system operational.

​

As part of the financial advisory team, SHA Analytics, LLC led the cost and schedule risk analysis during the project development and DBFOM procurement phases. Our process involved estimating risk-based cost and schedule outcomes for the project, using Monte Carlo simulation. This analysis helped LAWA understand the potential cost and schedule risks the project faces during its design and construction. By developing these risk-based estimates from the bottom-up, LAWA was able to evaluate risk allocation within the P3 contract terms and communicate risks to bidders during the DBFOM procurement process. LAWA reached financial close with their selected bidder in June 2018.

Additionally, the analysis allows LAWA to set project contingency budgets within a probabilistic framework, improving their budgeting by accounting for potential risk exposure. Following financial close, SHA Analytics, LLC worked with LAWA to update the risk analysis. This update accounted for LAWA’s retained risks versus those transferred to the P3 developer through the DBFOM contract, in order to set a contingency budget for LAWA’s retained risks.