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With the need for more high-speed rail lines in the United States, all eyes have been on the privately owned Brightline rail system, with one route already operating in Florida and the development of the Western route recently taking shape with a groundbreaking celebration.
Brightline broke ground for the high-speed west route in Las Vegas in April, with plans to begin rail operations ahead of the 2028 Olympics in Los Angeles. Work began on a 218-mile all-electric line between Las Vegas and the Los Angeles suburb of Rancho Cucamonga, promising a trip of a little more than two hours with a speed of 186 miles-per-hour. The company estimates that six million people will ride the train during the first full year with 10 million riders annually in the future.
Brightline founder Wes Edens said at the groundbreaking that his company aims to launch a “whole new high-speed rail industry” in the U.S. “In short order, many train systems will be built using the blueprint of what we build here,” Edens said, citing examples of “city pairs” located too far apart to drive and too near together to fly, like Dallas and Houston.
“There’s no reason the U.S. shouldn’t be the leader in the world for a high-speed rail industry” like the automobile industry, he said. The project is an example of cooperation across levels of government, party lines and private entities, he said. The Biden administration awarded Brightline West $3 billion in federal grants from the 2021 infrastructure law, and $2.5 billion in private activity bond allocation at the end of last year. “We’ve had unbelievable support at every level, local, state and federal.”
On the East Coast, where Brightline currently operates from Miami to Orlando, the line is looking to expand to Tampa. A recent resolution from the Suncoast Transportation Planning Alliance and Central Florida Metropolitan Planning Organization Alliance supports the cause.
Brightline came to market in late April with more than $3.1 billion in a large refinancing that featured its first investment-grade ratings. The transaction included the $925 million of unrated tax-exempt bonds that will finance the Tampa extension if it goes forward. The high-yield bonds, considered the riskiest in the debt stack, feature a mandatory tender date of July 2028.
The unrated debt was sold through a newly created subsidiary called Brightline Tampa. The current plan, as outlined in an April 25 official statement, calls for Brightline Tampa to work with the local business community to develop the portion that would consist of all stops west of the Orlando International Airport. There are currently two intermediate stops planned, serving the Orange County Convention Center and the major theme parks in Central Florida, and an additional planned stop in the Tampa area, the statement said.
Catch up on recent Brightline coverage below, and for more insight, watch panelists at The Bond Buyer Southeast Conference discuss Brightline and high-speed rail in a convo on Laying the Groundwork for Future Growth.
