A new generation discovers America’s passenger trains, and is asking for more
Passenger rail service in America is changing fast. Our modest network of trains and stations has been overwhelmed by crowds never anticipated when the nation’s passenger train system was designed two generations ago. More and more Americans are demanding a truly modern, high-quality, high-frequency train service.
The leaders are listening
And a new political consensus is emerging to deliver it. Elected officials on both sides of the aisle now agree Americans want and need trains, and decision makers are striving to provide them. They understand that the old passenger-train model is obsolete and that a new one must replace it.
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But what kind of new model? Where will the new trains come from – and how soon? Who will decide where the trains run – and who will run them?
Corridor Capital – passenger train developers
Corridor Capital LLC was formed in 2004 because Chairman James E. Coston foresaw today’s crisis and opportunity and designed a company to address them – a new type of business engaged in a new type of work called passenger train development.
What is a passenger train developer?
Just as a real estate developer need not be an architect or a builder, a passenger-train developer need not be a railroad. While the real estate developer assembles and integrates the work of architects, financiers, public sector planners, legal specialists, tax experts and construction contractors, the passenger train developer integrates the work of state and community transportation planners with the locomotive and railcar builders, train operating companies, maintenance contractors, onboard service vendors, reservations-software designers, WiFi providers and the railroads over which the trains operate.
A true Public-Private Partnership
The Corridor Capital business model is that of a Public-Private Partnership. Corridor Capital is a private business entity. The public partner typically is a state government, multi-state compact or municipal joint-powers authority seeking to sponsor an intercity or commuter passenger rail service.
While these government entities typically have access to funding for a passenger rail service, few are organized, structured or staffed to provide the train service itself. And very few own any cars, locomotives or maintenance shops to service their trains.
That’s where Corridor Capital comes in. Our company has experienced personnel both inhouse as well as with our partner firms to make sure public sector sponsors have access to all the expertise, skills and facilities needed to establish and run a successful passenger train program.
|Until the formation of Amtrak in 1971, all intercity passenger rail service in the United States was owned and operated by private-sector railroad corporations. The railroads owned the tracks, the trains, the stations, the maintenance shops and the commissaries; and the trains were operated by crews that had advanced to passenger duties after many years of operating the respective companies’ freight trains. Each railroad produced its own package of passenger-rail facilities and services. Today this railroad-based passenger-train system — trains, crews, support facilities and managers — is gone. Only the tracks remain. Thus, state governments, private companies and public-private partnerships seeking to operate passenger trains require a new resource capable of re-assembling these essential elements that railroad companies no longer provide.Corridor Capital is that resource: The company owns uniform passenger rolling stock and commands the professional skills of several dozen veteran passenger-train professionals, including civil and mechanical engineers, passenger-car and locomotive builders, station and terminal managers, locomotive and car maintenance specialists, planners, financiers, information technologists, travel-marketing and ticketing specialists and contractors providing on-board food, beverage and hospitality services.
At Corridor Capital, the train-and-travel package once delivered by a multitude of individual railroad companies has been reinvented and reassembled by a professional passenger-rail development company. Just as a real-estate developer brings architects, engineers, planners, lawyers and financiers together to create a new office, residential or commercial project, Corridor Capital brings its own agile cadre of specialists together to create the “project” America is waiting for: successful passenger trains.
Plus, we’ve got the wheels
Perhaps most important, Corridor Capital controls a fleet of passenger railcars which can be put into service quickly so that public-sector sponsors can start up a new passenger rail service – or take over an existing one – without suffering years of uncertainty while a new appropriation for passenger rolling stock makes its way (or doesn’t) through Congress.
Among Corridor Capital’s holdings are more than 50 of the indestructible stainless-steel “Hi-Level” fleet of coaches built in the 1950s and ‘60s for the Santa Fe Railway’s luxury overnight services between Chicago and California. Built by the legendary Budd Company of Philadelphia for cruising speeds of 110 miles per hour, the Hi-Levels are waiting to be stripped down to their shells and rebuilt to the latest levels of passenger comfort and safety, with advanced heating and air conditioning, modern ADA rest rooms, WiFi, electronic passenger information systems, reclining seats and contemporary food service and business class appointments.
The Hi-Levels are not just ready to be rebuilt. They’re ready to be new. By conforming to contemporary engineering standards the Hi-Levels will actually be superior in quality, performance and safety to their state when they first left the Budd factory.
They’ll also be different in application. The coach interiors, originally designed to carry 72 passengers in fully reclining sleeper seats on a two-night journey to the West Coast, will be reconfigured as intercity corridor coaches carrying 95 to 100 passengers on daytime itineraries likely to last no more than four to five hours. The denser seating arrangement – which involves no loss of comfort – means higher revenues and lower operating costs for the cars’ public sponsors.
Plus, we’ve got financing
When Corridor Capital acquired the Hi-Level fleet it didn’t just buy the cars. We also developed a series of financing models to make sure public-sector sponsors could get access to these cars without enduring the delays and uncertainty of winning an appropriation to cover the cost of a purchase. Our financial advisor, BMO Capital, is ready to arrange financing of the Hi-Level rebuilds so the new cars can be leased or sold to public sponsors under a variety of scenarios and terms including lease-with-option to purchase, low-cost, long-term RRIF financing, and lease with option. BMO Capital also stands ready to arrange financing for maintenance facilities so public-sector sponsors can have their new trains maintained by local private-sector contractors in a location convenient to their respective route. In addition, Corridor Capital can arrange for private capital financing of passenger rail assets and facilities.
Day trains for all at affordable cost: Corridor Capital’s vision for the future
Just as Americans have made it clear they want more passenger trains, they’ve also made it clear what kind of trains they want: fast, frequent day trains in corridors of 300-400 miles. Medium-distance intercity corridor trains – especially those with WiFi, business class seating and food service – are the sector where ridership numbers are exploding.
Fortunately, fast day trains also are one type of passenger train with great potential for covering their operating costs – always a factor when government faces tough transportation choices. They are also most likely to cover their equipment acquisition costs.
Corridor Capital is examining new opportunities to reinvent longer-distance and cross-country train travel featuring sleeping, dining and other special feature cars for passenger comfort and convenience. With some of the country’s finest passenger railroad professionals, all accomplished in the critical skills required to develop and operate efficient and modern trains with comfort and amenities designed for a superior passenger experience, Corridor Capital is positioned to reintroduce and promote the passenger train as a preferred transportation choice for new generations of American travelers.
“No equipment?” – Don’t believe it
Unfortunately, many potential public-sector sponsors are discouraged from starting a passenger-train service by an assumption that all eligible passenger railcars already are in use and that uncertain appropriations and long delivery timelines mean any startups must be postponed for years.
Not true. Corridor Capital can telescope those timelines with cars and locomotives ready to roll in as little as 18 months from Notice to Proceed.
“No funding?” – That’s a myth, too
Public planners need not be discouraged about a long and uncertain appropriations process. Corridor Capital and financial advisor BMO Capital can make bridge funding available so asset acquisition and service planning can go forward in parallel with long-term sponsorship development.
Corridor Capital wants to be your developer
The future just got clearer for public-sector passenger-rail sponsors.
You can get the train services – and the trains – you need, by turning to a professional passenger train developer.
Everything you need – service planning, financing, equipment, maintenance, onboard services, ticketing and reservations and a relationship with the nation’s railroad industry – is within your grasp when you engage Corridor Capital.
A new era of passenger train developers has emerged. Corridor Capital Chairman James Coston’s Railway Age Presentation October 2014 UpdatedJanuary 2017 in Washington, D.C. highlights how the modern passenger train developer is much like a movie producer or real estate developer: an assembler of all of the necessary pieces to create a new movie, building, or passenger train(s). PDF (20 pages)