MIAMI — Brightline last week deferred interest payments on private activity bonds after initially indicating it would draw from financial reserves to make the payments.
The company’s just-issued December revenue and ridership report says it elected to defer interest payments on debt due Jan. 15 on 11 bonds issued by the Florida Development Finance Corp., saying this is “permitted under the All Aboard Florida Operations Holdings bond documents.” This was the second deferral of interest after a payment was deferred last July on the same bonds. Default doesn’t occur unless three interest payments are deferred.
The day before the interest was due, Brightline had said in a filing with the FDFC that it would use a portion of its “debt service reserve” to make the payments.
The company also executed an amendment to $985 million in bonds from last year [see “Brightline remarkets $985 million …,” Trains.com, Aug 13, 2025], removing the requirement that it make interest payments in cash. This could pave the way for its pursuit of “a substantial amount of equity, the proceeds of which would be used to repay principal and interest debt of ours and to increase cash reserves.”
In a paywalled article, Bloomberg reports the company also has $1.1 billion of corporate notes that have an interest payment due Jan. 31.
After the deferred payment was revealed, the Fitch bond rating service on Friday downgraded Brightline’s debt, explaining why in an extensive analysis. This followed a bond downgrade by Standard & Poor’s in December [see “Brightline confronts cash crunch …,” Jan. 12, 2026].
These events follow the announcement, also last week, that the company has tapped former Eurostar CEO Nicholas Petrovic to become Brightline’s chief executive. [See “Brightline hires …,” Trains.com, Jan. 14, 2026].
Meanwhile, Brightline’s December report shows continued trends from November, confirming that additional premium capacity on fewer long-distance trains registered gains of 25% in both ridership and revenue. Miami-Orlando Smart class passenger counts were off slightly with fewer departures, but revenue was up 9%. Additional Miami-West Palm Beach frequencies netted a 23% increase ridership to a level not seen since 2023.
The company reports that its Brightline Rewards program has more than 515,000 members. It still has work to do in attracting out-of-state visitors; Florida residents represent 82% of the ridership total.
— To report news or errors, contact trainsnewswire@firecrown.com.
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