Fitch Ratings has affirmed Florida Department of Transportation's (FDOT) $270 million ($107.3 million current balance) Transportation Infrastructure Finance and Innovation Act (TIFIA) rental car facility (RCF) loan for the Miami Intermodal Center (MIC) at 'A.' The Rating Outlook is Stable.
The rating reflects solid demand for rental car transactions at Miami International Airport (MIA; A+/Positive) and the strength of the TIFIA loan structure, which provides substantial cash flow cushion and rapid amortization. MIA is a leading international gateway with a dominant role in Latin American and Caribbean air services. In Fitch's rating case, rental car demand, supported by traffic at MIA, and regularly scheduled customer facility charge (CFC) rate increases generate enough revenue to retire the TIFIA loan more than 10 years ahead of schedule.
Revenue Risk - Volume - Stronger
Strong Rental Car Market
MIA is a well-positioned gateway airport that supports a sizable rental car market in a premier leisure destination. It serves domestic and international arriving passengers and has a growing Latin American air service market. MIC's rental car provider diversity is favorable, with no meaningful concentration in a single operator. Fitch expects long-term transaction growth to remain low, tempered by the expansion of ground transportation alternatives.
Revenue Risk - Price - Stronger
Supportive Revenue Framework
The CFC rate increases by $0.25 every five years, as specified in the loan documents. To the extent CFCs are insufficient, the rental car companies are obligated to pay contingent rent to support a minimum 1.30x project life coverage ratio (PLCR), as defined in the security agreement. Project loans can be repaid solely from CFC payments even if transaction days do not fully recover to the pre-pandemic level through final maturity in fiscal 2045 under the Fitch rating case.
Infrastructure Dev. & Renewal - Stronger
Well-Maintained Facility
The facility is in good condition with ample capacity, and additional debt is not required to make capital improvements. In addition to routine maintenance requirements, the facility completes a comprehensive cost replacement analysis for asset renewal every five years.
Debt Structure - Stronger
Flexible Repayment; Early Amortization
The TIFIA loan is fully amortizing and senior ranking with an adequate covenant package. Amortization payments are sized to a percentage of available funds to pay off the loan by fiscal 2045. In Fitch's rating case, the TIFIA loan is fully repaid in fiscal 2033, 12 years ahead of schedule.
Peer Analysis
MIC's closest peers are Atlanta (A/Positive) and Hawaii Airport System CONRAC (A+/Stable). Relative to Atlanta, Miami has similar transaction day volumes but lower coverage and a shorter expected maturity profile. Fitch's primary metric for Miami is the PLCR due to the TIFIA loan structure, with principal payments sized to a percentage of available funds in its accounts. Similar to Miami, Hawaii has significant leisure traffic, but its stronger rating case coverage profile supports its higher 'A+' rating level.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative Rating Action/Downgrade
--A materially reduced level of rental car activity or increase in operating expenses that causes Fitch-calculated PLCR under the rating case to be sustained at or below 1.7x. This compares to Fitch-calculated rating case minimum PLCR of 1.7x on or after fiscal year-end 2027.
Factors that Could, Individually or Collectively, Lead to Positive Rating Action/Upgrade
--Outperformance in transaction days leading to Fitch-calculated PLCR at or above 2.0x in the rating case throughout the debt life.
Financial Profile
Fitch expects early payoff of the TIFIA loan despite a prolonged post-pandemic recovery of transaction days. Minimum Fitch-calculated rating case PLCR excluding reserve funds is 1.6x in fiscal 2026 and projected to increase to 1.9x in fiscal 2028. Reserve mechanics and the accumulation of substantial cash reserves in the rating case results in expected payoff of the TIFIA loan in fiscal 2033, 12 years before final maturity in fiscal 2045.
SECURITY
The loans are secured by CFCs levied by Miami-Dade County, FL on rental car transactions at MIA, and to the extent that CFC revenues are insufficient, contingent rent on participating rental car companies operating at the RCF.
REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF RATING
The principal sources of information used in the analysis are described in the Applicable Criteria.
Climate Vulnerability Signals
The results of our Climate.VS screener indicate some potential exposure to physical climate risk for Florida Department of Transportation (FL) [Miami Intermodal Center]. However, this does not influence the rating because the exposure is mitigated by the entity's access to governmental aid and ongoing resilience-focused infrastructure investment and adaptation measures.
ESG Considerations
The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. For more information on Fitch's ESG Relevance Scores, visit https://www.fitchratings.com/topics/esg/products#esg-relevance-scores.
