Indiana completes takeover of I-69 extension section
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The state of Indiana has completed taking control of the long-delayed section of the I-69 Section 5 P3 project from Bloomington to Martinsville from a private developer.
The I-69 project was being developed by I-69 Development Partners. The consortium was led by Isolux Infrastructure Netherlands B.V which partnered with the local contractors E&B Paving of Anderson, Force Construction Company of Columbus and Gradex Inc. of Indianapolis.
The Indiana Finance Authority completed a transaction to terminate the state's contractual relationship with the consortium, to reimburse the developer's bond holders for US$246 million, and to return direct control of the section to the Indiana Department of Transportation.
The I-69 Section 5 project involves rehabilitating and upgrading 21 miles of the existing four lane State Road 37 in Morgan and Monroe counties to interstate standards from Bloomington to just south of Martinsville.
As we reported, the project reached financial close on July 2014, which envisaged a total investment of US$325 million. However, Indiana officials have stated that another US$237 million need to be invested to finalize the road project.
I-69 Development Partners was to arrange its own financing to design and build the project. In return, the state would make annual payments to the group to operate and maintain the highway for 35 years after its completion. In mid April we reported that Standard & Poor’s (S&P) downgraded the private activity bonds (PABs) supporting the project to B+ from BB- after Isolux Corsan failed to provide additional funding.
Construction started in 2014. According to sources the project's new completion date would be pushed back from May 2018 to August 2018, being the fourth time the completion of the project has been delayed. The original completion date was October 2016.
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