firms trade off the benefits of debt financing against higher interest rate and bankruptcy costs
Defining debt as the dominant type of capital in the PPP structure of the highway project, we will focus our attention on the process of raising capital for the project. The key factor of the project attractiveness for investors and lenders is specific risk return profiles that largely depend on economic and financial characteristics of the projects, which depend on infrastructure sector and the physical infrastructure assets features. Highway infrastructure projects have the following features, which make investments in highway facilities less attractive: