MIAMI — Brightline, Florida’s private high-speed rail operator, is pursuing up to $100 million in additional debt to shore up its operations and handle potential legal costs, according to company disclosures, even as credit rating agencies warn of a growing risk of default on its existing bonds by early 2027.
The rail line has struggled to meet ridership projections despite recent gains. S&P Global Ratings downgraded Brightline’s senior secured debt to “CCC” from “BB-” this month.
“We think that switching riders from alternate modes, automotive in particular, is more challenging than originally forecast,” S&P said in a recent analysis. The agency projected only 15% growth in ticket revenue for 2026, adding that this could leave the company short on cash to cover debt obligations, heightening the odds of a default by January 2027.
Despite the warnings, Brightline reported positive momentum in its November financial update, with ridership climbing 14% to 280,136 passengers compared to the same month last year. Revenue from long-distance trips between South Florida and Orlando rose 21%, averaging about $80 per ticket.
To generate more cash, Brightline has listed its seven-story parking garage in downtown Fort Lauderdale for sale, with an asking price of $20 million. The 571-space facility, located next to the station, is being marketed by Jones Lang LaSalle, and the company plans to lease it back for 25 years if sold.
The rail operator, which posted a $71 million operating loss in the first half of the year, said the new debt would provide liquidity for daily operations and cover any payouts from ongoing lawsuits. These include a dispute with its rail corridor landlord, Florida East Coast Railway, over plans for a new commuter line, and a federal suit from a former conductor claiming PTSD from witnessing train-related fatalities.
Brightline also plans to draw from debt service reserves to make a January interest payment on its $2.2 billion in senior bonds, after deferring a payment on $1.2 billion of subordinate debt in July. That deferral, allowed under bond terms, sent prices tumbling, with some subordinate bonds now trading around 33 cents on the dollar — down from over 106 in March.
Company officials did not immediately respond to requests for comment.
However, one major investor, John Miller of First Eagle Investments, expressed optimism, noting that the fundamentals aren’t as dire as bond prices suggest and that some recovery can be expected going forward.
Brightline, backed by Fortress Investment Group, restructured $4.5 billion in debt last year and is seeking substantial equity infusions to pay down high-interest obligations and build reserves. The company has ramped up marketing efforts, including partnerships with airlines and cruise lines, holiday discounts, and fixed pricing for short-distance commuters to draw more riders.