Tag Archives: Fortress Investment Group

Henry Flagler Wouldn’t Have Bought All Aboard Florida Bonds, SLR/IRL

Stuart's City Seal The original seal of Stuart was designed by a committee of three, A. T. Hogarth, J. A. Hancock and Curt Schroeder. It showed the confluence of the north and south forks of the St. Lucie River and the Florida East Coast railroad bridge. The original seal, adopted when Stuart was incorporated on May 7, 1914, served through the 1970s. (Sandra Henderson Thurlow, Stuart on the St Lucie)
Stuart’s City Seal
The original seal of Stuart was designed by a committee of three, A. T. Hogarth, J. A. Hancock and Curt Schroeder. It showed the confluence of the north and south forks of the St. Lucie River and the Florida East Coast railroad bridge. The original seal, adopted when Stuart was incorporated on May 7, 1914, served through the 1970s. (Sandra Henderson Thurlow, Stuart on the St Lucie)

The ironies of life in Stuart and Martin County are grand.

Here are a few:

  1. Business tycoon, Henry Flagler, is said to have first planned to run his railway through and develop Sewall’s Point and then across the St Lucie River to Rocky Point rather than developing Palm Beach. Title problems with the Hanson Grant, of which Sewall’s Point encompassed, led Henry to change the path of his railroad, instead taking it through Potsdam, later named Stuart.
  2. Stuart’s orignal seal, adopted in 1914, shows only the railroad going through Stuart as there was no “auto bridge” at that time. The docks sticking out into the St Lucie River can be seen on the seal due to their importance to property and commerce at that time in history. —The St Lucie River was important to “commerce” like the train at that time.
  3. Stuart was first on the north side of the railroad over the St Lucie River. When leaders wanted to change the name to “Port St Lucie” the railroad company “denied” this as there was already a town by the same name north. So the clever leaders of the town just moved the train station over the river to Potsdam and changed the name to Stuart. When things don’t work, smart business men take another path…
  4. All Aboard Florida and East Coast Railroad, Henry Flagler’s company, is now owned by Fortress; their plan to expand Mr Flagler’s business is likely to fail.
City of Stuart seal showed the railroad and an auto bridge in 1978. Seal taken from city stationary. Courtesy of Sandra Henderson Thurlow.
City of Stuart seal showed the railroad and an auto bridge in 1978. Seal taken from city stationary. Courtesy of Sandra Henderson Thurlow.

 

Today proposed All Aboard Florida is not following Henry Flagler’s one famous quote: “To help others is to help yourself,” in the age of paternalism such was the justification of the railroad….not today… Fortress Corporation is doing nothing to help others, like putting a stop at every pineapple plantation, but rather figuring how much money they can make for themselves barreling right through and then failing for bigger and better things…like Panama Canal freight.  Luckily their plan is falling apart.

The following information was simplified and explained by Mr Len Sucsy, of CARE, Citizens Against Railroad Expansion. He is a business expert. He gives us the inside scoop in layman terms we can understand.

You probably know about the Martin County and Indian River County lawsuits that are pending, but the specifics of All Aboard Florida’s failing business deal makes its vulnerability easier to understand:

“All Aboard Florida is having difficulty selling their $1.7 billion tax
exempt, junk bond issue. Municipal bond investors are being quoted in
Bloomberg, the Chicago Tribune, and other media sources as being
“uncomfortable” with the business model not only because no passenger train in the
history of the country has been profitable but also the real estate
above and around some train stations is speculative and yet to be
built. Other freight rail cash-flowing services are also future
events and speculative. The high leverage of the deal is also been
noted…. a problem. A well known muni manger of a $36 billion fund passed on the deal for
“credit risk” reasons.

Fortress, Inc., parent company of All Aboard Florida and Florida East
Coast Railway, is closing its flagship macro hedge fund. At its peak, it managed
$1.6 billion which now stands at $400 million due to investor flight. Last year the fund lost .6% and this year is down 17.5%. Managing partner and billionaire co-founder of Fortress, Michael Novogratz will leave the firm.
The company share price (FIG, NASDQ) has dropped 32% this year…”

AAF CAN’T SELL ITS BONDS. THEY ARE A BAD DEAL. SPREAD THE WORD. WRITE IT ON FACEBOOK. CALL YOUR FRIENDS  UP NORTH. PUT UP A SIGN.

Maybe our sign should read: “HENRY FLAGLER WOULDN’T HAVE BOUGHT AAF BONDS.”

A train on the original wooden bridge that spanned the St Lucie River 1894. Historical Society of Martin County.
A train on the original wooden bridge that spanned the St Lucie River 1894. Historical Society of Martin County via Sandra H. Thurlow’s book St on the St Lucie.

Citizen’s Against the Train: (https://www.citizensagainstthetrain.com)

CARE Citizens Against Rail Expansion: (http://www.saveourfl.com)

Not All Aboard Florida: (http://www.floridanotallaboard.net)

Chicago Tribune article: (http://www.chicagotribune.com/news/sns-wp-blm-florida-rail-e93cdf80-6e97-11e5-91eb-27ad15c2b723-20151009-story.html)

Understanding How to Derail All Aboard Florida Along the St Lucie River/Indian River Lagoon

The movement to derail all Aboard Florida is gaining momentum. (Photo Peter Schmidt, United Yacht Sales . (Photo Jacqui thurlow-Lippisch)
The movement to derail All Aboard Florida is gaining momentum. (Photo of Peter Schmidt, owner, United Yacht Sales. Peter and his wife Anne attended the Florida NOT all Aboard Flotilla. (Photo, Jacqui Thurlow-Lippisch.)

Yesterday morning, over 100 boats gathered at the Roosevelt Bridge in Stuart, forming a flotilla in opposition to “All Aboard Florida’s” high speed train which would close the bridges over the St Lucie River for unacceptable periods of time. A large red sign on Angie and Jeff Swenson’s boat read NO TRAINS.

photo 2

(Above photo by Ed Lippisch and Scott Kuhns)

Just in case you are not familiar with the project,  I thought today I would describe the basics of how All Aboard Florida’s father company, Fortress Investment Group, is structured, as the best ways to garner change, is to understand “how it works.”

We here in Martin County have certainly learned this with our St Lucie River/Indian River Lagoon Issues. In fact, the river issues have  already galvanized our community so it has not been that difficult to do the same for the train.

In my opinion, in order to derail All Aboard Florida, there are two options: to stop the line at its source, (Orlando) or to get it to “go west.”

To begin with, one must understand the basic structure of Fortress Investment Group of which “All Aboard Florida” is part. Fortress consists of four divisions: 1. Flagler-the real estate entity; 2. All Abroad Florida-supposedely the first “private” rail system in America; 3. Flagler Global Logistics-a logistics solution group; and 4. ROW (Right of Way) Management Services.

Fortress Investment Group: (http://www.fortress.com/Default.aspx)

All Aboard Florida (http://www.allaboardflorida.com)

Keep in mind, Florida southern rail lines now consist of three main parts: 1. the Cocoa/Melbourne area to Orlando line or Highway 528/the money for the Orlando Train Depot; 2. the Florida East Coast Railway tracks  that run from Jacksonville to Miami (the ones that go through Stuart) and 3. the CSX tracks that run west from West Palm Beach to Orlando. 

Now we must go back in the story a bit to get perspective. Last year, “All Aboard Florida” was able to secure the right of way along Highway 528 from approximately Cocoa to Orlando, to lay tracks to the Orlando airport. Fortress had to get a “right of way” from the Florida Department of Transportation to lay tracks in order to do this.  On top of this a bit later,  they were granted funds from the state of Florida to build a rail “depot” station at Orlando International Airport. This Orlando element is actually the “All Aboard Florida” piece even though we keep using it for “down here.”

The second part of the puzzle, the Florida East Coast Railway tracks, are historical and owned by Fortress, these tracks run from Jacksonville to Miami. There is nothing we can do about this, except be vocal or rip the tracks out which would not be a good idea.

And last are the CSX tracks. These tracks run out west away from “us” starting in  West Palm Beach and going to  Orlando; they are not  owned by Fortress. They are owned by another company called CSX, a cargo company.  At this point, there is no plan to purchase these tracks to send the All Aboard Florida project west to Orlando rather than through our eastern cities.

photo tracks

Securing ROW Highway 528: (http://www.progressiverailroading.com/passenger_rail/article/All-Aboard-Florida-secures-right-of-way-for-OrlandoMiami-passengerrail-project–37920)

Funding of Orlando Depot: (http://articles.orlandosentinel.com/2014-02-17/news/os-orlando-international-scott-20140217_1_all-aboard-florida-rick-scott-depot)

In summary, it is clear that the only reason All Aboard Florida is “going south” at all is because the state of Florida has supported Fortress Investment Group with the Cocoa to Orland piece, Highway 528,  and the building of the train depot in Orlando.  This is the piece/s that must be derailed. I am not sure how to achieve this, however, if the northern piece goes kaputt so will the journey south-east. 

Train travel is actually a great benefit for people and the environment, having lived in Europe, I can attest to this. Nonetheless, the present All Aboard Florida plan is unacceptable with its negative effects on property values and businesses west of the Roosevelt Bridge, particularly  the marine industry. Let your local delegation know how you feel. We are important to them, between the river and the train, we have a lot to  say about their reelection, and believe me they need us.

LOCAL DELEGATION TO WRITE:

Fl. Senator Negon: negron.joe.web@flsenate.gov

House Rep. Harrell: gharrell@gayleharrell.com

Fl. House Rep. Magar : marylynn.magar@myfloridahouse.gov

Fl. Governor Scott: rick.scott@eog.myflorida.com

US Congressman Murphy: congressmanpatrick.murphy@mail.house.gov