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Project Profile: Elizabeth River Tunnels (Downtown / Midtown Tunnel)

Elizabeth River Tunnels (Downtown / Midtown Tunnel)

photo credit: Elizabeth River Tunnels


Cities of Norfolk and Portsmouth, Virginia

Project Sponsor / Borrower

Project Sponsor - Virginia Department of Transportation (VDOT)

Borrower - Elizabeth River Crossings Opco, LLC

Program Areas

Project FinanceTolling and PricingTIFIA


Highway / Tunnel


The Elizabeth River Tunnels (Downtown / Midtown Tunnel) project consists of five construction components involving three facilities in the Hampton Roads region of Virginia. Collectively, the project is known as the Elizabeth River Tunnels. The Midtown Tunnel portion consists of a new two-lane tolled tunnel under the Elizabeth River parallel to the existing Midtown Tunnel connecting the Cities of Norfolk and Portsmouth as well as modifications to the existing tunnel to provide increased capacity for east-west travel linking U.S. Route 58 and I-264 in Portsmouth to the interchange at Brambleton Avenue/Hampton Boulevard in Norfolk. Modifications to the interchange were also made. The planned improvements to the Downtown Tunnel have brought it into compliance with current fire and life safety standards. The MLK Extension portion of the project consists of an extension of Route 58 south from London Boulevard, approximately 0.8 mile to I-264 with an interchange at High Street.

The $2.1 billion project has been delivered on a design, build, finance, operate, and maintain (DBFOM) concession basis by Elizabeth River Crossings Opco, LLC (ERC) composed of Skanska Infrastructure Development and Macquarie Group. ERC is operating the concession for 58 years.


Est. Total Cost - $2,089 million (including construction, operations and maintenance, interest, reserves, insurance, and development costs)

Funding Sources

Senior Debt (Private Activity Bonds) - $675 million

TIFIA loan - $422 million

Equity Contributions - $272 million

Public Funds - $408 million

Toll Revenues - $268 million

TIFIA Capitalized Interest - $43 million

Project Delivery / Contract Method

Design-build-finance-operate-maintain Toll Concession (58 years)

Project Partner

Elizabeth River Crossings Opco, LLC

  • Skanska Infrastructure Development. Inc.
  • Macquarie Financial Holding Limited

Construction Joint Venture (design-build members)

  • Skanska USA Civil Southeast, Inc.
  • Kiewit Construction Company
  • Weeks Marine, Inc.
Project Advisors / Consultants

Project Design

  • WSP | Parsons Brinckerhoff
  • Volkert & Associates, Inc.
  • COWI
  • Systems Support
  • Transdyn
  • Federal Signal - ETC design, installation, O&M

To the Borrower

  • Macquarie Capital Funds Inc. - Finance
  • Steer Davies Gleave - Traffic & Revenue
  • McGuireWoods Consulting - Public Affairs
  • Orrick, Herrington & Sutcliffe - Borrower's Legal Counsel
  • Hunton & Williams - Borrower's Local Counsel
  • PBS&J - Intelligent Transportation Systems OR Colan Associates - Right of Way
  • Arup - Equity TA/Asset Condition Survey
  • Atkins - Lender's TA and Traffic Advisor
  • Marsh - Insurance


  • TIFIA Legal Advisor - Katten Muchin Rosenman LLP
  • TIFIA Financial Advisor - Scully Capital

Bondholders, USDOT TIFIA

Duration / Status

Comprehensive Agreement with ERC signed in December 2011 (commercial close).

Financial close - April 12, 2012

Construction start - mid-2012

Construction completion

  • Midtown Tunnel (new) - open June 2016 (one lane), October 2016 (both lanes)
  • Midtown Tunnel (existing rehabilitation) - ongoing through mid-2018
  • Downtown Tunnel (rehabilitation) - complete August 2016
  • MLK Extension - open November 2016

Duration of concession - 58 years

TIFIA Credit Assistance

Direct Loan - $422 million

The TIFIA loan will be repaid with toll revenues. TIFIA is further secured by a fully funded debt service reserve fund.

Financial Status

TIFIA credit agreement was executed on April 12, 2012.

Tolling of the existing Midtown and Downtown Tunnels to help finance the project, originally slated to start in September 2012, was delayed until February 1, 2014. VDOT provided additional state funding to compensate ERC for the lost toll revenue.

  • Virginia's Commonwealth Transportation Board issued its first GARVEE bonds under the Commonwealth of Virginia Federal Transportation Grant Anticipation Revenue Notes Act of 2011 to provide the public subsidy to support the project's private financing.
Related Links / Articles

Project Website

Virginia Office of Transportation Public-Private Partnerships

Comprehensive Agreement


P3 project development and procurement
Raymond Partridge
Program Manager, Virginia Office of Public-Private Partnerships
Tel: (804) 371-0128

Project construction
Frank Fabian, PE
Senior Project Manager
VDOT Hampton Roads District

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