Brightline (All Aboard Florida) Orlando - Miami FL FEC fka Virgin Rail

Could Tampa be on the horizon after Orlando/Jacksonville?
http://realtime.blog.palmbeachpost.com/ ... itor-says/" onclick="window.open(this.href);return false;

Mr. Arlington, obviously you are an investment professional and surely hold FINRA licensure reflecting such. Accordingly, I afford great respect to your thoughts on aspects of our discussion here regarding such.

For myself, never holding licensure other than that of a CPA, I always limited my advice to clients with the "broad conceptual stuff", i.e. "if you're just starting out, start with funds, as they are the only way a small investor can have diversity (next question was invariably "what's diversity?").

Now regarding the easements that FEC now holds through some "shell" beyond any SEC jurisdiction, I think they obtained them simply to be able to again operate any passenger train over their rails. They do not necessarily apply only to any AAF initiative; but with any initiative to operate passenger trains flying about out there, such as Amtrak or Tri Rail - and even AAF, best have 'em in place.

But simply because FEC/Fortress/whoever has decided "the time is right" to develop the parcels in Downtown Miami that essentially have been dormant other than a parking lot for the past forty years, as well as chop down some underused structures in Lauderdale and West Palm, does not in itself mean the AAF initiative is now "out of the gate". Maybe, I would "start to believe" if I were to learn that an elevated track structure was under construction leading to the "Miami Station", or if ground was broken on the Cocoa-Orlando proposed ROW.

But for now, my skepticism remains in place.

Gilbert B Norman wrote:But simply because FEC/Fortress/whoever has decided "the time is right" to develop the parcels in Downtown Miami that essentially have been dormant other than a parking lot for the past forty years, as well as chop down some underused structures in Lauderdale and West Palm, does not in itself mean the AAF initiative is now "out of the gate". Maybe, I would "start to believe" if I were to learn that an elevated track structure was under construction leading to the "Miami Station", or if ground was broken on the Cocoa-Orlando proposed ROW.
But for now, my skepticism remains in place.

I share some of that skepticism about AAF, at least to the extent that Fortress has no interest in running passenger rail, except that it seems a "near-breakeven" way to really get lots more value out of the real estate (as you note) and do some upgrades that they'll be happy got made to FEC (and, worst case, just let depreciate for a looong time).

Running a limited schedule on AAF will probably be somewhere between a small loser and a big winner. If AAF goes under, they probably know the will be sorely tempted to operate commuter rail, hurting the FEC no worse than AAF would have, and driving a whole lot of value to the new station complex mixed use towers.

No license for me, but do risk analytics that rely, in part, on all kinds of docs found in EDGAR.

And speaking of commuter rail, Tri-Rail has plans to operate on the FEC as well.

Rockingham Racer wrote:And speaking of commuter rail, Tri-Rail has plans to operate on the FEC as well.

Got a good link you can recommend? While an imposition on FEC, it seems the kind of "stone soup" reaction that Fortress was looking for that will boost its real estate, and share its rail costs. If all Fortress has to do is build stations at the base of its skyscrapers and upgrade the FEC in order to entice Tri-Rail to start (money-losing) commuter operations, that's a win for Fortress (and probably a "breakeven" for FEC), whether AAF makes money or lasts forever or not.

Arlington wrote:

Rockingham Racer wrote:And speaking of commuter rail, Tri-Rail has plans to operate on the FEC as well.

Got a good link you can recommend? While an imposition on FEC, it seems the kind of "stone soup" reaction that Fortress was looking for that will boost its real estate, and share its rail costs. If all Fortress has to do is build stations at the base of its skyscrapers and upgrade the FEC in order to entice Tri-Rail to start (money-losing) commuter operations, that's a win for Fortress (and probably a "breakeven" for FEC), whether AAF makes money or lasts forever or not.

Tri-Rail has been wanting to run on the FEC for years - since long before AAF was proposed. Sure, sharing AAF facilities might help the Tri-Rail service get started, but the Tri-Rail-on-FEC proposal is in no way a "reaction" to AAF.

tri-railcoastallink.com

You''ll note on the map that's included that the new connection at Iris will allow the current Tri Rail route to access the FEC and go [eventually] to the AAF Miami Central Station.

deathtopumpkins wrote:Tri-Rail has been wanting to run on the FEC for years - since long before AAF was proposed. Sure, sharing AAF facilities might help the Tri-Rail service get started, but the Tri-Rail-on-FEC proposal is in no way a "reaction" to AAF.

My claim wasn't "reaction" so much as "event catalyzed by". I'd say that giving all passenger rights to AAF and working out how FEC and "the passenger entity" could work where a single owner (Fortress) could create a safe way for FEC and "passenger" to figure out how to make the $ and ops work in a way that FEC's public shareholders never did. The stone of AAF in the in the pot of water has finally created a context for others--including Tri Rail-- to contribute their ingredient to the soup, with the real meat being big mixed use real estate at the station sites.

At the risk of pulling this topic off topic; Tri Rail over FEC? Well volks, that should have been moved forth about thirty years ago. I'm sure it was "talked about", but then (and some may hold even now; AAF notwithstanding), FEC would have had no part of such. Such was of course, "the natural route". I can remember my first trip to Florida during 1956. Be it assured, the SAL Deerfield Beach station was definitely out in the Styx. As I recall, at the railroad museum now in the Freight House, there is a photo of the Hillsboro Road/SAL X-ing back then.

But if somehow, some way, there were ever to be Tri Rail service over the FEC in place of that over the SAL, an awful lot of infrastructure improvements will have gone to waste. If there were to be service over both the FEC and the SAL, then the tri-county will be the most "overserved" region in the country.

Looking at the whole picture of passenger trains over the FEC, Fortress is more interested in the real estate development than any other aspect of FEC's business. That they have a management in place that runs a "heads up" railroad that, even with the debt service arising from the LBO, still makes a modest profit (just think what they'd be making if their Debt/Equity ratio was more "normalized") is simply a "plus". The prospect of passenger trains can only raise interest in the holdings they are now starting to develop. That of course is the former Miami station. The hype can only do one thing and that is raise occupancy and rent per Sq Ft. Soon the whereabouts of AAF will be, just as was the case with the Wash DC Metro, "its coming....its coming". But sooner or later, unlike the Metro, the "it's coming" will only be an echo.

I don't consider Tri-Rail to be Off-Topic because it illustrates "why now?"...why passenger is once again thinkable on the FEC. T

The point is that Fortress is doing what FEC/FECI's shareholders never had the patience to do: take a hit on the freight business in order to unlock the other assets in a big way.

Fortress needs there to be passenger rail over the FEC. Industrial development of parcels near FEC had only limited growth left, even assuming a busier Florida ports in a post-Panamax and post-Castro world. Heck, when Cuba first gets "normalized" the easiest way to see it will be on a cruise chip launched from Florida.

There is a whole need/opportunity on the service-financial-leisure side of the economy--where rail has become (again) attractive for commuters and intercity passengers and real estate developers, even if not a big winner to AAF, a sure loser for Tri Rail (except indirectly in area taxes), but risky to FEC's "industrial" business. I think it interesting that the Tri-rail proposal does not do a full-length trip on the FEC, perhaps reflecting that Fortress--even with all this new activity--can't quite make the case for paying for enough new capacity to have the FEC line continue south of FLL. There are limits to how much passenger can be crammed economically onto the FEC, and here is the picture:

AAF protestors still not backing down (with fair use quote):

But anti-All Aboard Florida groups, such as Citizens Against Rail Expansion (CARE Florida), continue to raise concerns over the construction of the stations and the increase in noise and traffic that the trains are apparently going to bring as they zip through the state throughout the day. The group plans to meet Wednesday to talk over data to push forward its efforts to stop All Aboard Florida's routes running through West Palm Beach and the Treasure Coast.

http://blogs.browardpalmbeach.com/pulp/ ... ervice.php" onclick="window.open(this.href);return false;

Economist claims AAF will face major losses. Bullet points outlined in the article:
http://www.bizjournals.com/orlando/blog ... ually.html" onclick="window.open(this.href);return false;

Tri-Rail, however, is willing todivert half of its frequencies onto the FEC.

NH2060 wrote:Economist claims AAF will face major losses. Bullet points outlined in the article:
http://www.bizjournals.com/orlando/blog ... ually.html" onclick="window.open(this.href);return false;

Full report is here. I was skimming but I'd say his error is looking just within the 4 corners of AAF itself and not looking at the whole ecosystem:
- He allows for zero cost-sharing with FEC,
- He never considers Fortress' real estate interests, turning worthless scrub into prime space
- He never allows for fees charged to Tri-Rail
- He never considers generational modal shifts and and increased transit use along the corridor...while making a big deal out of current low transit usage along it

It could be that Fortress' intent is to build the real estate (station devs), attract Tri-Rail, and then file AAF for bankruptcy, but there's going to be passenger ops on the FEC when this is all done

From Marriott Biscayne Bay Miami--

I tried yesterday, but was thwarted by a monsoon rain so bad it made coverage on NBC Nightly News, but today I'm going down there to 1st Street to see what, if anything, has been done to at least break ground on the new station complex.