Demand & revenue study for the Américo Vespucio Norte and Túnel de San Cristóbal road portfolio

Globalvia appointed VTM as its traffic and revenue advisor in view of the successful bid for Brookfield’s secondary market sale of its 34% share in Autopista Vespucio Norte (AVN) and Túnel de San Cristobal (TSC) toll roads portfolio located in the heart of the capital and economic center of Chile, on a transaction evaluated at over € 340 Million.

AVN (29 km) and TSC are part of the Santiago beltway and operate under a free-flow toll collection system with multilane unidirectional gantries. AVN has three lanes per direction and a design speed of 100 km/h and was awarded on May 2002 for a 30-year timespan while TSC consists of two parallel tunnels (approximate length: 2 km per direction) and was initially awarded in October 2004 for 35 years.

This advisory required the econometric modeling of traffic demand with a particular focus on the applicable pricing mechanism due to its impact on revenue: both assets run on variable toll tariffs by time of day differentiated by 30-minute intervals, and dependent on the average speed observed on each 30-minute time slot over the previous year, the Concessionaire is entitled to activate congestion tariffs in the following calendar year if the minimum average speed falls below certain thresholds – ‘Base peak’ and ‘Saturation peak’ tariffs -, requiring a sound understanding of its challenging Congestion Charge Mechanism evolution over time.

The extensive work performed in close collaboration with Globalvia’s Demand Analysis team provided the basis for this portfolio valuation and allowed Globalvia to successfully take another relevant stake in the Chilean toll road market.