Herbert Smith Freehills projects team advises Victorian Department of Transport on A$1.85bn Next Generation Trams procurement

Herbert Smith Freehills has advised the Victorian Department of Transport on the A$1.85bn Next Generation Trams project. This is the Victorian Government’s biggest single investment in the tram fleet and network in decades. 

Herbert Smith Freehills is advising on the project which comprises an investment in 100 Next Generation Trams to be rolled out from 2025, providing more modern, accessible and energy-efficient tram services to the network, and a proposed new state-of-the-art tram maintenance and stabling facility in Melbourne’s west.

The Victorian Government signed a contract with Bombardier Transportation Australia (recently acquired by Alstom) to design, build and maintain the trams for 15 years, following a competitive tender and evaluation process.

This project is highly significant in delivering the State’s policy objectives to support and scale up Victoria’s manufacturing industry and encourage local supplier participation. It also will help to secure supply chain certainty and Victorian industry resilience.

The Herbert Smith Freehills team was led by projects partner Jim Theodore and supported by a multidisciplinary projects team across commercial law, property, planning and heritage, and safety. Our team included partners Erin Wyeth and Juan-Jose Zentner, senior associates Marianna Schneider, Joseph Varghese and Ella Darroch, and solicitors Annabelle Davis, Jeremy Soh and Jade Tam. Our specialist advisers included Heidi Asten, Steve Bell, Emily Peverill, Rachel Foo and Rachel Zagami.

Herbert Smith Freehills partner Jim Theodore said, “It has been great to have been a part of this significant transaction that will not only improve public transport, but will support the growth of Victoria’s manufacturing industry and improve its strength in the face of external risks such as the pandemic. We look forward to seeing this project progress and working with the Victorian Department of Transport throughout the process”.

Other advisers included Allens (advising on the tram franchise aspects of the project), PwC (commercial and financial adviser), and Minters (advising the successful bidder). 

This deal is another example of Herbert Smith Freehills’ market-leading work in transport infrastructure. Other recent examples include:

• Acting for the Victorian Department of Transport for the procurement of X’Trapolis 2.0 trains from Alstom.
• Advising the financiers to the largest PPP in Australia, and the first PPP in the market to feature Alliance contracting principles — the A$11.1 billion North-East Link PPP in Victoria.
• Advising Transport for NSW on the procurement of M6 Stage 1 on a design and construct basis.
• Advising Roads and Maritime Services on the procurement of Rozelle Interchange, a new underground motorway interchange.
• Advising various bidders in relation to packages for the Sydney Metro Western Sydney Airport.