Financing Completed for Largest U.S. Greenfield Transportation P3 Deal – Nossaman Advises TxDOT

06.18.2010

AUSTIN (June 18, 2010) – The LBJ Infrastructure Group has announced that the Texas Department of Transportation's LBJ Express Project has reached financial close ahead of schedule.  As part of the public-private partnership (P3) deal, LBJ Infrastructure Group - a Cintra-led consortium - will build, finance, maintain and operate a 17-mile corridor which includes managed lanes in the congested Dallas-Fort Worth area. Full financial close will be reached next week.

With construction costs over $2 billion, this is the largest U.S. greenfield transportation P3 deal ever.  The initial $2.8 billion to develop the project includes $445 million in public funds, $664 million in equity, federal credit assistance in the form of a conditional $850 million TIFIA loan commitment and reservation of funding, as well as $615 million in private activity bonds. The operations and maintenance costs over the life of the concession agreement bring the deal total to approximately $4 billion.

The project reached commercial close in July 2009.

The Dallas Police and Fire Pension System is a significant equity partner in LBJ Infrastructure Group, as it was in the North Tarrant Express P3 deal which reached financial close in December 2009, making it the first pension fund to invest directly in infrastructure development in the U.S.

The LBJ-635 project shares many precedent-setting features with the North Tarrant Express, including a letter of credit to secure performance from the design-builder and to protect the lenders as well as federal tolling authorization under the United States Department of Transportation's Express Lanes Demonstration Program.

The LBJ-635 project is first highway P3 deal to reach financial close in 2010. It continues a string of three P3 deals which reached financial close in 2009; the I-595 Managed Lanes Project and the Port of Miami Tunnel Project – both in Florida, and the North Tarrant Express in Texas.

More information about the project is available at http://www.txdot.gov/business/partnerships/i_635.htm.

More information about project leads, Brian Papernik and Christine Ryan, are available at www.nossaman.com/bpapernik and www.nossaman.com/cryan .

Nossaman's infrastructure practice group blogs about infrastructure news, policy, and industry developments at www.InfraInsightBlog.com.

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