Twelve years after Denver first mulled a tax levy to fund the development of a commuter rail connecting Union Station to the city's airport, the University of Chicago A Line train is in service.
Built by a Fluor-led consortium through a PPP – the first such partnership for a public transit system in North America – the line served over 80,000 passengers on its opening weekend, beating out estimates that predicted 60,000 riders.
The line, which consists of seven stops, will operate daily between 3:00am and 1:00am. It is part of a larger $2.1 billion, 36-mile rail network plan under development by Denver Transit Partners, a consortium comprising John Laing through its Denver Rail Holdings unit (45 percent), Aberdeen Global Infrastructure Partners LP unit Aberdeen Infrastructure Investments USA (45 percent) and Fluor (10 percent).
Financing for the project comprises roughly $1 billion in federal grants, equity investments totalling $54.2 million, state and local tax revenues, and public debt. Macquarie Capital was also listed as an investor when the project was awarded in June 2010, but sold its stake to John Laing and Lloyds Banking Group investment arm Uberior just two months later when the project reached financial close.
A consortium of Fluor, Balfour Beatty Infrastructure, Ames Construction, Alternate Concepts and Parsons Brinkerhoff built the 22.8-mile segment that opened on Friday.
With two shorter routes connecting the northern and northwestern sections of the city to Union Station still left to be completed sometime this year, the Eagle P3 Commuter Rail Network project remains under construction. While emphasising that the A line is the most important segment within the system, the project's proponents say the other two routes will contribute to making the network more robust. The Eagle project is part of the Denver public transportation agency's $6.9 billion FasTracks Plan to expand the public transportation system throughout the eight-county Denver metropolitan area.
Fitch Ratings boosted $398 million in bonds issued by the agency to A- from BBB+ for the Eagle P3 project in December, a decision based on counterparty credit strength after Fluor was rated A- with outlook stable. The bonds were underwritten by Bank of America Merrill Lynch and Barclays.
Interest in transit system P3s may be ramping up more widely across North America, a spokesperson for John Laing told Infrastructure Investor. “If other cities want to attract high-growth companies that are involved in tech and they're employing people in their 20s and 30s, they need to have a decent transit system. If you want to attract people in their 20s, a lot of them don't want to have a car, and they want to be able to go out and come home on the train.”