The Canada Pension Plan Investment Board is signaling strong interest in expanding its toll road holdings, citing their stability and long-term profit potential. Blacklock's Reporter says in a report, the board described toll roads as ideal infrastructure investments and praised Toronto’s 407 Express Toll Route — Canada’s most expensive toll highway — as a prime example.“Canada Pension Plan Investments is keenly interested in transportation infrastructure assets like toll roads which offer scale and stability,” the Board stated. “The 407 Express Toll Route stands out both in Canada and globally for the exceptional long term advantages it provides investors.”Originally built with taxpayer funding, the 108-kilometre highway was leased to private investors in 1999 by the Ontario legislature for 99 years at a price of $3.1 billion. .The board currently owns a 50.01% stake in the toll road, alongside SNC-Lavalin Inc. and Spain-based Ferrovial S.E. Operators have reported profit margins of 25 to 30%.The average daily cost to use the 407 is $14.74 per driver, with peak tolls running up to 62¢ per kilometre for motorcycles, 78¢ for passenger vehicles, and $1.54 for freight trucks. Over 360,000 drivers use the route each day between Burlington and Pickering, Ont.“This asset ticks all the boxes for us,” said Andrew Alley, managing director at the board, in the report titled Paving The Way: A Landmark Investment In Ontario’s Economic Arteries. The document emphasized the highway’s long lease — more than 70 years remaining — as a key advantage. “407 Express Toll Route offers more than twice the duration of similar infrastructure agreements globally,” it said..Last year, the toll road generated $1.7 billion in revenue and $692.2 million in profit. The Board attributed its growing interest in the asset to its scale, inflation-linked Canadian dollar cash flows, and a robust regulatory framework.The report did not identify any other Canadian cities where toll roads may be pursued, but its enthusiastic tone marks the strongest endorsement of toll infrastructure by a federal agency since PPP Canada, a former Crown corporation, studied toll financing in 2013.The concept remains controversial. During the same year’s Commons transport committee hearings, Paul Moist, then-president of the Canadian Union of Public Employees, criticized the 407 lease as an ideological move that shifted public assets into private hands.“This is an ideology, not a business plan,” Moist said. “The public always winds up holding the bag.”
