The Puerto Rico Public-Private Partnerships Authority announced its short list of four consortiums Wednesday that may submit proposals in a potential long-term lease agreement involving the island’s busiest toll road.
The authority picked four infrastructure investment companies to participate in a request for proposals process from the eight candidates that submitted initial qualifications in late July.
The selected consortiums are: Abertis Infraestructuras of Spain and Goldman Sachs Infrastructure Partners II LP; CCR (Companhia de Concessôes Rodoviárias), headquartered in Brazil; Itínere Infraestructuras SA of Spain and Citi Infrastructure Investors; and OHL Concesiones of Spain and Morgan Stanley Infrastructure Inc.
The selection was based on technical and financing capabilities, and compliance with Puerto Rico’s Public-Private Partnerships Act.
Abertis owns and operates airports and roadways, including 2,300 miles of toll roads, while Goldman Sachs Infrastructure has more than $3 billion in capital, according to the authority.
CCR is the largest operator of highways in Latin America with $97 billion in market capitalization, managing 1,195 miles of toll road.
Itínere is a leader of highway operations in Spain, while Citi Infrastructure’s investment fund focuses on infrastructure investment.
OHL is among the world’s top 10 infrastructure managers, overseeing about 1,698 miles of toll roads, while Morgan Stanley Infrastructure’s investments total about $4 billion.
The commonwealth is looking to enter Route 22, a 52-mile east-west toll road that runs through the north side of the island, into a 50-year concession agreement with a private infrastructure operator and investor. The winning consortium will pay the government an up-front payment and will operate Route 22 and collect its toll revenue.
Route 5 is also included in the plan. That four-mile toll road connects to Route 22 and runs through the San Juan area and further south into Bayamon.
“This P3 is critical to the modernization of our highway network,” Rubén Hernández-Gregorat, Secretary of the Department of Transportation and Public Works, said in a statement. “We analyzed all the statements of qualifications in a responsible manner in order to move on to the next step of inviting the short-listed proponents to submit RFPs.”
The Puerto Rico Highways and Transporation Authority oversees Routes 22 and 5, along with Route 66 on the eastern side of the island and Route 52, which connects San Juan and Ponce. The agency has around $7 billion of total outstanding debt.
The highway authority would need to pay down outstanding debt associated with Route 22 and Route 5 before handing over the toll revenue stream to an outside operator. Officials have declined to release the amount outstanding debt on the two roadways.
Leasing Route 22 and Route 5 to an outside operator could generate billions for Puerto Rico from the up-front payment and shift maintenance, operating, and capital project costs to a company or consortium.