With 2025 approaching, Florida’s higher speed rail train continues to bleed money. Earlier today, the Orlando Business Journal (OBJ) reported that Brightline has lost $493 million in 2024.
RELATED STORY: Brightline Rail Reports $116 Million Financial Loss for First Quarter of 2024
A 44% increase in ridership and 211% increase revenue didn’t combine to overcome costs. According to Fortress Investment Group, a major factor for Brightline’s large comprehensive loss was Brightline diverting $218.6 million toward paying off the billions of dollars of debt, and interest expenses increased by $78.9 million.
Brightline’s addition of its Orlando station led to mixed results during the first year. Operating expenses spiked by 111.2% to $212.84 million, primarily due to Brightline’s expansion from within South Florida to Orlando, but Fortress’ report also credited Orlando for Brightline’s revenue spike due to the higher ticket prices for long-distance travel.
According to OBJ, Fortress Investment Group has invested nearly $6 billion so far building Brightline’s stations, tracks and other infrastructure from Miami to Orlando. To help fund these developments, its affiliates have sold taxable and tax-exempt bonds through the Florida Development Finance Corporation.
Brightline is responding to high demand for train service by ordering 25 additional passenger coaches, expected to arrive in 2025. Until then, the company may restrict ticket sales for short trips within South Florida to offer more seats for profitable long-distance routes to Orlando.
A recent bond offering on December 13 aims to resell up to $300 million in debt, primarily as tax-exempt FDIC bonds with an 11% interest rate maturing in 2030. Brightline’s total debt is projected to reach about $4.6 billion.
Brightline trains began operations on FEC tracks in 2018 with three downtown stations in Miami, Fort Lauderdale, and West Palm Beach. Two more stations opened in December 2022, one near Aventura and another in Boca Raton.
