Toll increases help Macquarie post gains, stave off losses

| 10/21/2009

Traffic may have declined on three of four U.S. toll roads operated at least in part by Macquarie Infrastructure Group, but the Australia-based investor managed to post some gains, particularly on the Chicago Skyway.

The Skyway, which Macquarie operates with Spain-based Cintra, posted a 7.7 percent gain in traffic for the September quarter. That gain helped Macquarie average a 1.6 percent traffic increase for its U.S. toll-road portfolio, which includes the Dulles Greenway in Virginia, the South Bay Expressway in San Diego, and the Cintra-Macquarie-operated Indiana Toll Road.

Macquarie’s portfolio gains compare with 0.6 percent growth posted in the June quarter and a traffic decline of 6.4 percent posted in March.

Macquarie officials stated that construction on other roadways helped drive more traffic onto the Chicago Skyway, which helped the traffic and revenue figures.

“Widening work on the Borman Expressway portion of I-94 (which is due to run until mid-2011) continues to aid the improved light vehicle traffic on the Skyway,” Macquarie officials stated in a quarterly report published Wednesday, Oct. 21.

Macquarie experienced traffic declines of 4.5 percent on the Dulles Greenway, 13.6 percent on the South Bay Expressway, and 1.3 percent on the Indiana Toll Road.

Despite the traffic decline, the Dulles Greenway posted a 15.1 percent revenue gain for the quarter. Tolls increased in January, which helped pad the revenue stream.

The Indiana Toll Road saw a 0.4 percent gain for the quarter, but again a toll increase on April 1 was a contributing factor.

The South Bay Expressway lost ground across the board, including a revenue loss of 0.7 percent. The loss could have been greater if not for a toll increase that took effect in January.

“Overall, revenue continued to increase on all major roads in the portfolio reflecting the improving traffic trends and the positive impact of the changes to tolling structures implemented over the past twelve months,” Macquarie officials stated.

The Cintra-Macquarie-operated 407 Express Toll Route in the Toronto, Canada, region experienced a traffic decline of 0.6 percent for the quarter, but saw revenues increase by 2.4 percent. A toll increase enacted in February of this year contributed to the gains on that roadway.

Macquarie and occasional partner Cintra broke into the North American toll road market in 1999 with the 407 ETR, followed by the Chicago Skyway and Dulles Greenway in 2005. The partnership leased the Indiana Toll Road in 2006 for $3.85 billion.

The Macquarie-operated South Bay Expressway opened as a “greenfield” or newly built toll road in 2007.

– By David Tanner, staff writer