Brightline, Florida's high-speed rail operator, is preparing to file for Chapter 11 bankruptcy in New Jersey to restructure approximately $5.5 billion in debt, according to sources familiar with the matter. The planned filing follows over a year of unsuccessful negotiations with creditors aimed at reaching an out-of-court agreement.

The restructuring plan involves reducing Brightline's debt to about $2.7 billion. Under the proposal, the company’s operating arm would remain outside of bankruptcy to ensure continued train service, while the restructuring would occur through its holding company under Chapter 11 protection.

Sources indicated that Brightline might finalize and potentially distribute a restructuring support agreement imminently, possibly as soon as Thursday.

Brightline began operations in 2018 with service between Fort Lauderdale and West Palm Beach. The company expanded in 2023 by launching its Miami-to-Orlando route, forecasting 4.5 million annual passengers for that line by 2026, according to a Fitch Ratings report published in 2024.

To finance its growth, Brightline accumulated $5.5 billion in debt through a mixture of municipal bonds, taxable debt, and commuter bonds. Despite these efforts, the company has faced challenges achieving projected ridership figures. As of August 2026, the rail line recorded nearly 1.4 million long-distance passengers for the year, with monthly ridership in August increasing by 4 percent, reaching 262,385 passengers compared to the previous year.

Since the appointment of former Eurostar CEO Nicolas Petrovic earlier this year, passenger numbers have shown some improvement. However, the growth has not been sufficient to sustain Brightline’s substantial debt load, leading to the company’s decision to seek bankruptcy protection and restructure its financial obligations.