The $90 million Camino Colombia Toll Road, Texas’s first and only private superhighway, was sold at a foreclosure auction Tuesday for $12 million after three years of less than expected traffic.
Camino Columbia, Inc, owners of the 21.8 mile road, had counted on strong revenue from truck traffic stemming from the North American Free Trade Agreement but delays in implementation and a weak economy made it impossible to pay back $75 million in outstanding loans from 1999.
John Hancock Life Insurance Co., one of the investors, purchased the road after the Texas Department of Transportation would not bid higher than $11.1 million.
Investors were not only counting on increased NAFTA traffic but a worsening of congestion around Laredo to entice drivers. Despite increased traffic, however, many truck drivers chose routes around the road because they felt the $16 toll was too steep. Cars paid $3. The road, which connects Texas with the Mexican border state of Nuevo Leon, remains open but its fate is uncertain.
In addition to a $75 million loan from John Hancock and New York Life Insurance Co., the road was built with $15 million from local investors, including $6 million from the International Bank of Commerce.
