Morgan Stanley was the underwriter for the transaction, which was purchased by 67 different investors, the company said. The sale of the tax-free private activity bonds, which was authorized earlier this month by the Florida Development Finance Corp., represents one of the largest such transactions recorded. The FDFC says taxpayers would not be on the hook if the company were to default.
Ridership on Virgin’s express train may finally be on track to meet its aggressive targets.
Formerly known as Brightline, the company reported late Friday that March ridership had increased 17 percent over February’s to 91,903 passengers, with revenue increasing 21 percent.
The company is aiming for more than 2 million passengers and revenues of $55.8 million for 2019. So far this year, it has carried approximately 244,000 passengers, grossing $5.9 million. Last year, it carried 580,000 passengers, grossing about $10 million in revenues.
I completely remain astounded by this whole initiative. While I have now had three enjoyable joyrides to date, never in my over sixty five years of following railroad industry affairs, have I been so mistaken about the outcome of anything within such. I knew Amtrak was a "con job" business plan right from A-Day, and while I did at first think Conrail was a "con game", I realized "they're gonna make it" once they were able to emiciate the ERIE and LV and still retain its traffic and sell the DL&W and CNJ to the State for its NJTransit lines.
But I can only acknowledge so far as Brightline, how mistaken I have been.
Posts: 9975 | From: Clarendon Hills, IL USA (BNSF Chicago Sub MP 18.71) | Registered: Apr 2002
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While I wish these people every success and would like to be part of their cheering section, "putting my money where my mouth is" won't be part of it. I just feel like good an idea as this may be I don't see it coming out financially in the US transportation situation.
Posts: 2808 | From: Olive Branch MS | Registered: Nov 2002
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My hat shaped cake waits until there are financials satisfying this CPA (ret; title is mine for life) Brightline is a going concern without anything from the "Tallytrough".
Sir Richard has had his "fun"; he got to promote his new cruiseline and splash some of his Red paint around. Beyond that, what did he do other than offer up a celebrity endorsement?
Must say, some of this rings of RRY on the Chessie with his ordering twice as many passenger cars as they could ever use; ordering cars, including Domes, for a Wash-Cinci trains that couldnt fit into Wash. However, there was back then, a ready market for the excess with the B&O, DRGW, IC, and NYC.
Posts: 9975 | From: Clarendon Hills, IL USA (BNSF Chicago Sub MP 18.71) | Registered: Apr 2002
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This article, appearing in Today's Wall Street Journal gives insight, as well as mention, regarding the successful underwriting of the "junk". Apparently, in search of yield, institutional investors are willing to take a high risk of default:
Fair Use:
Virgin Trains U.S.A., backed by Fortress Investment Group, has benefited from high demand for munis. Also known as Brightline, the train seeks to connect Orlando, Fla., to Miami.
But it didn’t fill up its trains with as many passengers as expected in 2018 after station opening delays, according to bond-offering and financial documents. The company also faced losses, financial records show. A spokesman for the train said it had always projected a “multiyear ramp-up” for revenue and ridership.
Even so, in April, muni investors lent Virgin about $1.8 billion to expand, marking the largest unrated muni bond deal over the past five years, according to calculations by MMA.
Brian Wynne, head of public finance at Morgan Stanley , which underwrote the bonds, said high demand enabled the railway to sell $250 million more in debt than initially planned, with yields roughly a fifth of a percentage point less than expected. Virgin could issue $950 million more in the coming months, according to the Florida Development Finance Corporation.
Such bonds “enable the private sector to deliver critical infrastructure projects,” said Wes Edens, co-chief executive of Fortress and Chairman of Virgin Trains..
Promise; you won't find these "puppies" in my portfolio.
Posts: 9975 | From: Clarendon Hills, IL USA (BNSF Chicago Sub MP 18.71) | Registered: Apr 2002
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Hard as it may be to believe, "Brightline/Virgin buddy", Gannett Treasure Coast Newspapers actually has run a piece that could be called "news".
Fair Use:
In May, Virgin Trains carried nearly 86,000 passengers, generating about $1.7 million in revenue, according to self-reported numbers released this week. The company is obligated to publish monthly ridership and revenue numbers because it's receiving tax-free bonds.
Over the first five months of the year, Virgin Trains has carried just over 401,000 customers and brought in $9.4 million. In Virgin's efforts to sell $1.75 billion in private- activity bonds, the company projected carrying roughly 2.3 million passengers in 2019 and generating a little more than $60 million, according to financial statements from the company
Of interest is that it looks like their Opinators have "thrown in the towel", and the only remaining opposition is Indian River County, who is pursuing their interests in Federal Court (a lawyer once said to me "if you feel you got screwed at State level, you go to Federal"). I guess those folk out on John's Island need to "blow their $B's" on something.
Finally, of greatest interest to me is that May revenue and ridership is out there. This will be the first real "comparo" of MIA-WPB available.
Posts: 9975 | From: Clarendon Hills, IL USA (BNSF Chicago Sub MP 18.71) | Registered: Apr 2002
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Guess I’m not surprised that Carl Hiaasen would not be thrilled with Virgin Trains. My wife and I have always enjoyed his very funny books, full of eccentric characters and thinly discussed loathing of Florida developers and politicians. While he has some valid points, i suspect those who have to deal with south Florida traffic will embrace this service, regardless of how profitable or not. Just run the trains fast, frequently, and on time.
Posts: 2397 | From: Camden, SC | Registered: Mar 2006
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These numbers are "out there" on the "light web". I have no idea regarding source, but if there is any foundation to them, it is no wonder BL/VT is becoming "opaque". Possibly they are able now that the IPO was CXD and the bonds have been privately placed:
Updated monthly ridership data: Code: ----- 2018 2019 Jan 17,783 73,568 Feb 24,098 78,707 Mar 32,899 91,903 Apr ?????? 71,308 May ?????? 85,740 Jun ?????? Jul Aug Sep Oct 60,013 Nov 80,660 Dec 98,076 Code: Revenue: ---------- 2018 2019 2020 Jan ---------- $1.7m Feb ---------- $1.9m Mar ---------- $2.3m Apr ---------- $1.8m May ---------- $1.7m Jun Jul Aug Sep Oct $1.0m Nov $1.5m Dec $2.2m
Comparative May ridership and revenue would be great to have made public, but if they are dismal, and with private placement of the bonds obviating any requirement to do so, they will be hard to come by.
I have no knowledge if the "Tallytrough" will be "open and ready to serve you", but with the "clubby" environment at any state capital, I wouldn't be surprised. Also wouldn't be surprised if "it never got out".
Posts: 9975 | From: Clarendon Hills, IL USA (BNSF Chicago Sub MP 18.71) | Registered: Apr 2002
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It also appears to "tie" with May "numbers" I reported immediately.
However, the PDF file is copy protected and cannot be included within the text of this posting.
Given the "knowns" reported above as well as those within the PDF report, comparative ridership can be deduced as follows:
-----------2019-----2018---%TGE
JAN-------73568----17783--313.7%
FEB-------78707----24098--226.6%
MAR-------91903----32899--179.4%
APR-------71308----23320--205.8%
MAY-------85740----34100--151.4%
TOTAL----401226---132200--203.5%
.5% difference in total: "sorry 'bout that".
Posts: 9975 | From: Clarendon Hills, IL USA (BNSF Chicago Sub MP 18.71) | Registered: Apr 2002
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It appears my earlier concerns that ridership reports would no longer be circulated are unfounded.
Of interest; service from Miami Central was inaugurated May 19, 2018, so June will be the first month for which comparative "numbers" will be available.
Posts: 9975 | From: Clarendon Hills, IL USA (BNSF Chicago Sub MP 18.71) | Registered: Apr 2002
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I will concede that never in more than sixty five years of following railroad industry affairs, have I been so mistaken about the outcome of a project.
I have now learned that the FDFC bonds have been rated Aaa, or investment grade, by Moody's. This is in sharp contrast to the earlier rating agency, Fitch, bestowed on them of not investment grade.
Now a question: what benefit has been gained by Sir Richard Branson's "horn in"? Enquiring mind wants to know.
Posts: 9975 | From: Clarendon Hills, IL USA (BNSF Chicago Sub MP 18.71) | Registered: Apr 2002
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This afternoon, it's off for a joyride. Leave Miami Central 350P to WP, early Dinner @Ruth's, return 740P.
$72; Select (Business).
Of interest, no mention of Virgin at the site. Is Sir Richard "still in"? Who knows what will be at either station.
Sorry Sir Richard, but with all the carefully crafted branding Brightline has done, shame to have it go to waste. But then, those with "Big egos" seem to have "thin skin".
Posts: 9975 | From: Clarendon Hills, IL USA (BNSF Chicago Sub MP 18.71) | Registered: Apr 2002
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Glad you made it to FL and anxious to hear your Brightline and A -T reports. Looks like we won’t make it to FL for spring baseball this year as heading to an Alabama gulf beach instead. No trains involved as I don’t think the Gulf Wind is still running.
Posts: 2397 | From: Camden, SC | Registered: Mar 2006
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First, I found the Brightline labels remaining at Miami Central, even if Sir Richard has horned in with some of his. At West Palm, you wouldn't know he had any connection whatever.
Both "Pink" and "Green" remain liveried as such. Can't speak for the other three sets.
But I really hold the best positive is the revamp of their site allowing passenger seat selection. When selecting, you will be shown a diagram of the car - including the direction of travel.
Amtrak, are you reading?
The only negative is they have downgraded their wine offerings. Last year, in both the Select lounge an on board, they were offering Ferrari-Carrno Chardonnay (upscale). This year Cupcake, for which at the liquor store, you bend low enough to have it hurt.
Everything was fine on the Northward trip, but the return....?
At 29th St in the Wynwood neighborhood, some "room temperature IQ idiot" made a right turn at the X-ing - and on to the ROW. There was no collision and cannot imagine any injuries. The train was able to clear, but there was still "head scratching time" between the cops and FEC officials.
We were delayed about twenty minutes - big deal. All told, $72 well spent.
Posts: 9975 | From: Clarendon Hills, IL USA (BNSF Chicago Sub MP 18.71) | Registered: Apr 2002
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Even I, with very low wine standards, skip over Cupcake. But glad everything else went well. Wonder if you can have a beer in lieu of wine. I’ll take a Guinness over a mediocre wine any day.
I guess Amtrak can’t let you select seat based on direction of travel and location of seat because they have no clue on a daily train specific basis which cars are being used.
Posts: 2397 | From: Camden, SC | Registered: Mar 2006
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Well, now that the act has been moved 40 miles up the road, and Black Beauty is back in my custody, first was an "ABC Run" to get two bottles of a Gruner Veltliner and a Papa John's pizza. One glass of that, along with a Chardonnay at the hotel's "Manager's Reception", I'm ready for the bunkhouse. Two 11PM nights are enough for me.
Mr. Palmland, last time I had "suds", was @ Kam's in Champaign - that's been a while, needless to say.
Posts: 9975 | From: Clarendon Hills, IL USA (BNSF Chicago Sub MP 18.71) | Registered: Apr 2002
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