It has been observed that projects pertaining to commercial development, tourism properties, wayside amenities, hotels, etc. result in better revenues to the private sector. In projects that are highly capital intensive like an urban rail project or airport development project, where it seems unlikely that revenues from only operations would offset costs, it is useful to consider the development of stand-alone, financially feasible projects like commercial complexes, shopping malls, hotels, etc. The objective is to offset or minimise the impact of negative cash flows from the operations of the core project with revenue inflows from the operations of a non-core viable alternative.
However, a decision on whether the development of a non-core viable project is packaged with the core project and awarded to a single private partner or the non-core viable project is to be developed as a separate project and the revenues generated from it used to fund the core project, has to be taken by the public entity. The decision must be backed by sound reasoning and implemented with caution.