All Aboard Florida's Brightline trains to rebrand as Virgin
Richard Branson, the British billionaire who wants to transform air travel with supersonic jets, has put his sights on something decidedly more down to Earth: a passenger railroad.
Branson has agreed to make a small investment and lend the Virgin brand to Fortress Investment Group’s Florida railroad, the first privately-funded intercity passenger train to be built in the U.S. in more than a century.
The private-equity company’s Brightline, which currently operates passenger train service between Miami, Fort Lauderdale and West Palm Beach, will rename itself Virgin Trains USA this month and use the brand and Virgin’s “marketing expertise” for existing and future developments, the company said Friday in a statement.
Branson met with Brightline chairman and Fortress co-founder Wes Edens at the company’s new station in Miami late last year to discuss Edens’ vision for a nationwide expansion, people familiar with the deal told Bloomberg News.
Fortress' All Aboard Florida project marks a major bet that train travel can be profitably revived in the U.S., where the federally subsidized Amtrak service has long held a nationwide monopoly.
In December 2017, the Florida Development Finance Corp. issued $600 million of private activity bonds on behalf of All Aboard Florida to finance portions of the first phase, the 66.5 miles between Miami and West Palm Beach. Another $1.75 billion new money and refunding deal is in the works.
Brightline currently plans to expand to Orlando and Tampa and will begin construction next year on a line linking Las Vegas to Southern California once it closes the planned acquisition of XpressWest and receives needed federal approval. Edens said in a May interview that the company sees Dallas, Houston, Atlanta, Charlotte and St. Louis as potential cities that it could target with its railroad service.
The Virgin Group will make a small investment in Brightline, which will continue to be managed and operated by the company’s executive team and affiliates of Fortress. The investment would give Virgin a few percent stake in the company and will be similar to other deals it has struck in the U.S., the people familiar with the deal said.