The pipeline of public-private partnership transportation deals is slowly building in the U.S., though it continues to lag the rest of the world.
Globally, private investment in infrastructure is booming and U.S. public pension funds are getting in on the action, according to Reason Foundation’s latest
In the U.S., Georgia, Colorado and Indiana all have potential P3s on tap, said Robert Poole, the report’s author and Reason’s director of transportation policy. Louisiana, Virginia, Maryland and Alabama are also moving forward with P3s.
“The last big financings were in 2019 and so we’ve had a two-year hiatus of financial closings of transportation P3s,” Poole said. “But I think the number of things in the pipeline is looking very positive for the next three or four years.”
Reason releases the report in part to encourage more P3s in the U.S.
Of the 15 largest greenfield transportation infrastructure P3 projects that were financed in 2021, only one was located in the U.S., the $527 million
Infrastructure investment funds in 2021 raised a record high amount of around $136 billion, depending on the data used, the report said. And over the last five years, the top 100 global infrastructure investment funds – which Poole said account for about 90% of the sector – raised $791 billion.
“That [$791 billion] number even surprised me and I’ve been following this for a decade,” Poole said.
But in the U.S., equity investment into long-term transportation P3s remains "an outlier," he said. "We are trying to show policymakers and people in Congress, state legislatures and state departments of transportation that this new model is a lot more widespread than you realize, and we ought to do more of it in the U.S."
Even as it lags the world, the U.S. is starting to see an uptick in deals.
Colorado is considering an unsolicited bid – the private entity is yet to be named – for a design-build-finance-operate-maintain P3 for express toll lanes on I-25.
Oregon and Washington are mulling a P3 structure for replacement of the I-5 bridge spanning the Columbia River, which forms part of the border between the two states. Virginia is considering a plan to add express lanes to a “missing link” in the I-495 Capital Beltway express toll lanes system, which has been developed entirely using DBFOM P3s. A planned
Louisiana has
Georgia has a trio of megaprojects on tap in the Atlanta area over the next decade, including an estimated $6 billion plan for express lane projects on I-285, which will be structured as revenue-risk DBFOM maintain with a 50-year concession. The state is set to use the same structure for an express toll lane project on SR 400.
Alabama’s $2.1 billion Mobile River Bridge project, which was
Pennsylvania’s Major Bridges program, which is
The largest revenue-risk P3 concession in the pipeline is Maryland’s
The report said no new U.S. greenfield DBFOM deals reached financial close in 2021, though some existing projects refinanced, and new projects, like
The new infrastructure law
U.S. pension funds, which
The nation’s largest public employee pension fund, CalPERS, which has
Poole said he’d like to see public pension funds start to lobby for more U.S.-based investment opportunities to help boost the development of P3s here.
“It’s a matter of public policy,” he said. “Those opportunities exist in Europe and Canada and Australia, but very few exist here.”