Bonds Used To Finance Construction Of MiamiCentral Now Yield 15% As All Aboard Florida Looks To Sell More Debt
Bonds issued last year by All Aboard Florida have been dropping in the secondary market.
The bonds are financing the construction of the MiamiCentral terminal in downtown Miami, along with a rail line to and stations in Fort Lauderdale and West Palm Beach.
The company sold $405 million worth of bonds last June. Since then, their value has decreased nearly 7%, Bloomberg reports. Prices are now said to be 93.5 cents on the dollar, resulting in a 14.7 percent yield (payments for those bonds are in-kind, resulting in higher interest rates.)
While the drop may not be significant, especially in a market that is relatively illiquid, the company still needs to sell $1.75 billion to finance the remainder of the rail line running between West Palm Beach and Orlando. Some analysts say that the company may have trouble selling the new debt.
To help sweeten the deal, All Aboard Florida has been trying to gain tax-free status for the new bonds from the Florida Development Finance Corp., but a small group of angry residents and politicians from Martin and Indian River counties have mounted legal challenges to those efforts.