Proximo North America Awards 2022: Staying on top

It is highly unlikely that President Joe Biden had the health of the US project finance market in mind when he signed the Infrastructure Investment and Jobs Act (IIJA) and the Inflation Reduction Act (IRA). But the two blockbuster pieces of legislation are likely to further entrench the United States’ position as the world’s largest market for the financing of energy and infrastructure assets.

The US has not always made it easy for developers or lenders. The use of tax credits to incentivise renewables has added needless complication to the financing process, and while the new legislation makes it a little easier to use these, the subsidy regime is far from intuitive. But with the US moving further and faster into electrification and decarbonisation, it is possible that subsidies will become useful to a much larger range of sectors than simply renewables.

After a brief downturn in solar activity at the start of 2022, renewables development and financing activity took off strongly by the fourth quarter, according to Proximo Intelligence data. The first of a wave of LNG export facility financings came to market, and foreshadowed a very strong start to 2023. While Canada hosted a small number of noteworthy financings, the country's shift towards build-financings for essential infrastructure meant that the US has essentially taken the lead in concessions-based PPP.

So 2022 combined a series of ever-larger and more complex greenfield financings for new projects, particularly those that contribute to the United States’ energy security, with some real structural innovation in refinancings and acquisition financings. While there were some high-profile bond financings among the highlight transactions of the year, banks probably responded best to the unsettled conditions in credit markets. But the best deals managed to tap new sources of liquidity, whether institutions, development lenders or bank lenders comfortable with hybrid structures.

Proximo presented awards to winning firms and the winning infrastructure finance transactions at a ceremony at the Proximo Financing America's Infrastructure 2023 event in Nashville. A list of the region’s winning transactions and firms, along with a description of each transaction’s high points and links to their Proximo Intelligence data entry, are all below.

For more details on each transaction, follow the link on the name for each deal

Deals

North America PPP - 495 Express Lanes Northern Extension 

Transurban refinanced and extended the length of its Capital Beltway concession in Virginia - TIFIA loan and all - with a new $2 billion package that combined five different sources. The new package introduces TIFIA to the mini-perm, and includes both fixed-rate bond debt and a new Virginia Transportation Infrastructure Bank loan.

North America Roads - PennDOT Major Bridges P3 Package One

The financing for Pennsylvania’s first PPP bridges package closed quickly despite some political and legal challenges, thanks to a sponsor group that worked hard to maximise local content. Its financing included the largest PAB issue to date - some of it carrying a monoline wrap.

North America Airports and Overall North America Award - JFK New Terminal 1

The series of PPP concessions for upgrades to New York’s airports reached their peak with this ambitious financing for the redevelopment of JFK’s Terminal 1. The financing - the largest ever for an aviation project in the US - featured four experienced sponsors, and 12 lenders. Even without much movement on airport privatisations, aviation is becoming a key sector in US PPP.

North America Social Infrastructure - Blackstone American Campus Communities Acquisition 

The $12.8 billion financing supporting Blackstone’s acquisition of American Campus Communities marked the true moment when infrastructure finance crossed over into the US student housing market. Given the importance of maintaining strong partnerships with universities, accessing project finance lenders through a well-structured transaction was an obvious fit.

North America Digital infrastructure - AMP Everstream Refinancing

AMP refinanced its acquisition of the Everstream business-to-business fibre operation and added on some capex facilities for a fibre-to-tower expansion project. The hybrid project/corporate and opco/holdco structure attracted commitments from both banks and institutional lenders.

North America Manufacturing - Intel/Brookfield Foundry

This was both the largest project financing to close anywhere in 2022 - greenfield or brownfield - and proof that project finance lenders could try their hand at new assets - in this case a chip foundry. In this effort they were helped by the fact that joining manufacturer Intel was well-regarded infrastructure investor Brookfield. The CHIPS Act and the presence of cash-flush infrastructure investors mean that Intel’s Semiconductor Co-Investment Program could be an influential template.

North America Leisure - CFG Bank Arena

An Oak View Group-led consortium put together a delayed-draw term loan financing for the complex brownfield renovation of the 60-year old Royal Farms Arena in Baltimore. The financing was successfully syndicated down to both major commercial banks and minority-focused financial institutions, including one that serves communities near the arena. 

North America Acquisition - Arclight Parkway Generation

Arclight’s acquisition of 4,805MW of conventional power capacity from PSEG was the largest conventional power M&A transaction in the last five years, and the $1.24 billion term loan B financing in support of the purchase was one of the largest US power B loans of the last four years. This well-executed deal is a reminder that financial sponsors and institutional lenders will be crucial to the restructuring of the US power industry in the face of the demands of the energy transition.

North America Renewables - AES Clean Energy MIS and Warehouse

AES has achieved a long-standing ambition of independent power producers - a frictionless long-term refinancing of operational power assets. It combined a novel master indenture structure with an expanded development warehouse facility to create a flexible financing conveyor belt for its renewables business.

North America Emerging Energy - Champlain Hudson Power Express

The Blackstone-sponsored 545 km Champlain Hudson transmission line endured a 10-year development process, but finally closed on a $5.2 billion debt package in June 2022. The financing is one of the largest ever for a greenfield transmission asset, and tested underwriters’ debt appetite and swap placement skills.

North America LNG - Venture Global Plaquemines

Venture Global proved that its entrance into the US LNG market in 2019 was no fluke, closing the largest greenfield energy project financing globally in 2022. The $13 billion Plaquemines financing built on Venture Global’s modular construction approach to test lenders’ appetite for swaps, construction risk and an equity bridge.

Firms

North America Sponsor of the Year - Blackstone

Blackstone enjoyed an extremely strong year in 2022, including sponsor roles on two award-winning transactions, the $5.65 billion Champlain-Hudson transmission project and the $2.7 billion acquisition of student housing provider American Campus Communities. In addition, it went straight to work with its recent QTS acquisition, closing two data center financings in 2022. Blackstone is equally at home with complex greenfield projects where development skills are required, and with large brownfield acquisitions where financing firepower is key.

North America Bank of the Year - MUFG

In pure league table terms, MUFG finished 2022 far, far ahead of the competition, closing on 107 deals compared to the runner-up’s 45. It also worked on six of the year’s award-winning transactions, most of them in a top-tier role. It had a particularly good year in LNG, but also demonstrated its capabilities in high-profile renewables, social infrastructure and transport deals in the US.

North America Law Firm of the Year- Latham & Watkins

Latham & Watkins finished a very close second in 2022’s league tables in terms of volumes supported, but far in front in terms of transaction numbers. Its USA energy franchise remains hard to beat. It represented the lenders on the AES warehouse and MIS and the sponsors on the Plaquemines and Parkway transactions.

North America Financial adviser of the Year - Agentis Capital 

Canada-based Agentis Capital would struggle to match its strong showing in 2021, but still facilitated two high-profile transactions - both in transit - in 2022. The greenfield Ontario Line South project in Canada and refinancing of the Purple Line PPP in Maryland were both complex undertakings that involved careful layering of public and private capital.