The U.S. surface infrastructure sector is on a growth track for the rest of the year, despite uncertainty around President Donald Trump's much-touted $1 trillion infrastructure plan, according to Logistics Management, citing a mid-year report from Fitch Ratings.
The financial research company said airports and ports should continue to experience strong activity through the end of 2017. Toll roads will see a more modest boost in revenue due to toll increases and will continue to face resistance from groups opposed to tolling.
Despite enthusiasm for public-private partnerships in some quarters, state and local governments remain hesitant to explore the structure for infrastructure projects due to the lack of funding sources and misconceptions about how P3s work. Most public agencies will continue to finance such projects through traditional lending mechanisms.
Increased traffic through airports and ports has helped to drive related construction spending on upgrades and expansions.
For example, in May, the Broward County (FL) Board of County Commissioners authorized a $437 million expansion of Port Everglades, in Fort Lauderdale, FL. The expansion will allow the port to better accommodate the larger post-Panamax ships through the installation of new berths and the tripling of existing deepwater turnaround areas.
Port Everglades processed more than 1 million 20-foot shipping containers in 2016, bringing in $163 million in revenue.
The Federal Aviation Administration allocates money to airports across the country for infrastructure improvements like runway upgrades and repairs as well as changes to marking, signage and lighting. However, major terminal-replacement projects must be financed by the local governing authority through traditional loans or bond funding, a public-private partnership, or a mix.
Los Angeles International Airport is the second-busiest airport in the U.S., and it is currently undertaking a $14 billion overhaul. The huge spend includes the $5 billion Landside Access Modernization Program and the $1.6 billion Midfield Satellite Concourse. The new concourse will connect passengers to the airport's main terminal by way of an underground tunnel; it will be able to service jumbo airliners from two of the 12 new gates included in the project.
The joint venture of Turner Construction and PCL Construction will build the Midfield concourse. A $2.7 billion, 2.25-mile-long people-mover included in the Landside program is expected to be delivered through a P3 but the consortium has yet to be named. That portion of the project is facing legal pushback regarding its environmental review.