Posted on 09/22/2018 11:52:38 AM PDT by Publius
With its funding plans clearer, South Florida passenger start-up Brightline is looking west for its next venture into private high speed rail.
Brightline on Tuesday said it had acquired XpressWest, a high-speed passenger rail project with rights to develop a federally approved corridor connecting Southern California and Las Vegas.
he project would be only the second privately funded intercity passenger rail in the United States after Brightline.
No terms were disclosed.
“Brightline is changing transportation in our country by connecting heavily trafficked corridors that are too long to drive and too short to fly,” said Wes Edens, co-founder and co-chief executive of Fortress Investment Group, parent of Brightline. “Our experience in Florida is proving that private-sector investment has a meaningful role to play in developing transportation infrastructure. We’re excited to bring Brightline’s world-class and convenient travel experience to Southern California and Las Vegas.”
Less than 300 miles away, The Strip’s hotels and casinos have long been a getaway destination for visitors from California. Proposals for high speed rail go back decades, most recently the Las Vegas Railway Express, or X Train, a 2010 start-up that had received state approval, issued stock, and purchased passenger cars before being discontinued in 2016.
Earlier this month, the Florida Development Finance Corp. approved Brightline’s request to act as a conduit for the issuance of $1.75 billion in Private Activity Bonds to finance construction of rail infrastructure in Miami-Dade, Broward, Palm Beach, Brevard and Orange counties for Phase 2 of the higher-speed passenger rail system. Phase 2 covers construction of the true high speed line to Orlando.
“The introduction of high-speed rail between Las Vegas to Southern California will bring significant economic and environmental benefits to our state and support increased tourism,” said Nevada Gov. Brian Sandoval. “Brightline has built a proven model for privately funded high-speed rail service in Florida and we are excited to welcome them to Nevada.”
Brightline currently operates higher-speed passenger service between Miami and West Palm Beach limited to 79 mph. The company hasn’t said when it will be able to break ground on Phase 2.
The XpressWest deal will potentially enable Brightline to link one of the most traveled routes in the country, connecting more than 22 million people living in Southern California with Las Vegas, one of the most visited cities in the US. Brightline quoted ridership studies as finding travelers make more than 50 million annual trips between Las Vegas and Southern California. Today those travelers are limited to traveling by air or highway; Brightline expects to make the trip in less than two hours.
High speed rail is also expected to benefit from the move of the NFL’s Oakland Raiders to Las Vegas in 2020.
As a result of the acquisition, Brightline will take over the development, construction and operation of the project and work with federal and local transportation officials to connect Las Vegas with Victorville, CA, 200 miles away, with future plans to expand into the Los Angeles area.
The first phase of the corridor is expected to be built on a right of way within and adjacent to Interstate 15, traversing 185 miles with no at-grade or pedestrian crossings. Construction is expected to begin in 2019, and Brightline is planning to begin initial service in 2022.
Union Pacific and BNSF maintain mainline operations in the vicinity, including from Southern California through Cajon Pass through the San Gabriel mountains to Las Vegas, among other destinations. It’s unclear whether Brightline, which operates on sister company Florida East Coast Railway’s track in South Florida, intends to negotiate agreements for use of those lines.
“Brightline’s model is setting a new standard for train travel in America,” said Patrick Goddard, president of Brightline. “Today’s announcement is an important milestone for our company as we re-imagine transportation between these major metropolitan areas. We look forward to working with the region’s stakeholders to make this vision a reality.”
“The XpressWest team has done an incredible job bringing this project together and we’re confident that Brightline will fulfill our mission and promise to the region,” said Tony Marnell, founder and chief executive officer of Marnell Companies, a southern Nevada developer that built the Mirage, Bellagio and Wynn Las Vegas, and is backing Xpress West. “We’ve been impressed with what Brightline has accomplished in Florida and are excited to be part of the team that is working to deliver privately funded high-speed rail to improve mobility in America.”
Brightline said it is in the process of acquiring 38 acres of land adjacent to the Las Vegas Strip for construction of mixed-use development and an intermodal hub with access to taxis, buses, shuttles, and limousines.
The first Southern California station is planned for Victorville, a 30- to 45-minute drive for 4-5 million people who live in the Inland Empire and eastern Los Angeles County, and within reach of Southern California’s remaining 17 to 18 million residents. Planning for additional stations and connections, Brightline said, to the Metrolink commuter rail system – and eventually California high speed rail – is underway.
“California has a vision for a modernized rail network that is fast, clean, and convenient for travelers, and the introduction of Brightline service linking Southern California to Las Vegas will help us achieve that vision,” said California State Transportation Agency Secretary Brian Annis. “Brightline will be beneficial for our economy and our transportation system.”
That’s better. You really had me going for a bit.
Almost forgot the libertarian part of my name. LOL.
I think gambling and drinks and food on bard would pay for the system. If not fares might be low. Hotels in vegas could make it free in appearance with them paying room tax at the end.
Yep. An unaudited financial statement reviewed this month showed that Brightline has about $59K in unrestricted funds and restricted funds that will almost cover liabilities. They expected to make a $20MM profit this year, but lost $28.8MM in the first quarter with sales of about $667K. The only way they have to survive is to sell the bonds.
But, in Jerry Brown's world, this is a successful business model.
At the end of May they finally got into Miami. The numbers should be understood to reflect that.
Understood. I simply reported the most recent data I could find.
Brightline in FL does not run much faster than the regular commuter train - “High Speed” is a marketing misnomer. 5mah more? Oh, at start-up there were lots of death/accidents.
Fewer stops than a commuter. Originally Miami, Ft Laud, maybe a couple in WPB area then eventually to Orlando. Now want to add another stop btwn O and WPB. The communities btwn O and WPB have tried everything they can to not have the train stop, or even go through their community, until now - $$$ is floating around FL style.
Lots of great perks at first that go quickly away. Parking becomes and issue. Uber/Lyft becomes a reality. Low cost disappears with the free parking. Being a single person/couple a trip from WPB to Mia for say $20 per might make sense for a short trip/museums/dinner/date. As your group gets larger the economies disappear.
The drive to LV is not bad. The drive back is hell.
I see you work in entertainment. I live in Huntington Beach, but have an office in Burbank. Most of my clients are in the industry one way or another.
Cesspool cleaning.
I’d rather drive to Vegas than drive by 405 LOL. That’s crazy, from HB to Burbank. Everyday? I would go nuts by the traffic and drive alone. I have close friends in Costa Mesa , but it better be a really good event for me to even drive there.
Las Vegas to Victorvile for the “high speed” train will not reduce north bound traffic into, or south bound traffic from Victorville on the I-15 (already a cummuter suburb for workers with jobs south of Cajon Pass).
I-15 along the segments between Cal-60, I-10 & I-210 northbound up & over, and south bound down from Cajon pass are already parking lots at various times of the day & week. It will only get worse, as additional So. Cal. travelers try to use the Victorville train connection to Vegas. Their additions to the traffic are likely to defeat possible time saved between Victorville and Vegas.
And Cajon Pass and it’s single main highway, I-15, could only be offset/bypassed by So.Cal. travelers west of the Inland Empire taking the I-5 north out of San Fernando, getting off below Santa Clarita at Cal. Rt-14, then taking Rt-14 north to Palmdale, to connect to Rt-138/18 over to Victorville. Neither are Interstate grade roads and the additional miles makes that detour not a likely choice for anyone.
That leaves a “high speed” rail line likely to make So.Cal. I-15 traffic worse than the “horrible” state many between Victorville and south of Cajon Pass already see it as.
I think the whole venture will turn out to be a fiancial boondoggle. Another “high speed” train to nowhere.
A "boondoggle" requires the presence of government money. Fortress Capital proposes to do this the traditional capitalist way. It may succeed or it may fail. Failure is a great teacher.
I’m sure you know better than I do. I’ve only lived in Las Vegas 38 years and am a mechanical engineer. And I’ve seen multiple rail efforts fail, including the current monorail. And of course Victorville is a smokin hot destination city.
But hey, what do I know? I’m sure some New York hedge fund knows better and has a couple billion to blow. I’m sure it will be as successful as the $60 billion California High Speed rail. And I’m sure they won’t ever come looking for bailout money.
Thank you.
And please don't think I'm touting this project. Unless they build a tunnel under Cajon Pass and a new route into Los Angeles Union Station, it won't work as expected. But maybe the New York big money boys know something we don't.
All the private interests in the railroad to Vegas venture should seek instead to take over Ontario International airport and expand air service between there and Las Vegas.
Ontario International is near enough to most of southern California (& only 1 hr from central L.A.). Flight time to Las Vegas is about one hour. Total travel time would be less than the drive up the crowded I-15 to victorville and then a “high speed” train that will not likely go even 100MPH which by itself will take another two hours.
Rail is old style technology with fixed path and essentially fixed destination infrastructure. Planes have multiple and variable route options.
The problem with air travel today is not enough airports and not enough exansion at smaller airports. If “Las Vegas” investment helped expand the use of Ontario, Ontario would expand beyond that and continue to further relieve uber busy LAX.
“A “boondoggle” requires the presence of government money. Fortress Capital proposes to do this the traditional capitalist way.”
Sorry, “capitalist” or not, it will be a boondoggle grant to the engineering and construction outfits (the big money pushing for it) that will get paid, whether the high speed rail company investors do or not. The “infrastructure” magnets are the true and possibly only big beneficiaries of these BOONDOGGLES. And “capitalist” or not they have pols cheerleading as well (and getting new campaign contributions for their cheerleading). And when the “private” venture fails, watch how fast the “consumers” using the venture push their politicians to rescue it - after all.
The expansion of Ontario Airport has been another project they have been talking about since at least 1981.
Nothing happens because the corrupt Dims keep taking our money for their own pockets & partying.
Instead we get broken roads & broken pipes and “brilliant” ideas like the Road Diet.
Part of the problem with Ontario International Airport is (1) it was for a long time controlled by an operating authority that was also in charge of LAX (and that authority did not have any local interest in expanding Ontario much) and (2) the FAA has not been a great help in approvals for more flights to/from Ontario either.
Then after the 2008 financial crisis hit, the Inland Empire economy was hit severely and two airlines shifted flights from Ontario to LAX - Southwest and Jet Blue (what deals did the controlling authority give those airlines that it would not give them to keep any flights at Ontario. Passenger miles at Ontario peaked in 2007 and are not back to those levels now.
From 2010 to 2016 the City of Ontario sued to rest control of the airport from the operators of LAX. The county of San Bernardino joined them, and after a six year legal battle together, they control the operating authority for Ontario International.
I would commision a private study with some industry experts to investigation the option of privatizing the airport together with the challenges and financial prospects of success.
Ontario has assets - runways. Ontario’s runways are long and one is longer than three of the four runways at LAX.
There should be more air freight lines with flights in and out of Ontario, but that which wants to land more inland than LAX was grabbed by San Bernardino with the facilities abandoned by Norton Air Force base, and all the many government incentives that went along with that. Yet, the entire Inland Empire has spouted warehousing and distribution centers like weeds, and that includes around Ontario as well. More air freight traffic would help stabilize the revenues at Ontario.
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