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Massive cruise ship and cargo facility proposed
Published on Monday, May 5, 2008
Preliminary documents are likely to be signed within two weeks, triggering the start of a massive $200 million cargo-port development on George Town’s North Church Street, replacing the Port Authority premises.
Initial construction is expected to begin by the end of this year and will involve creation of multiple cargo berths and unloading facilities on an artificial peninsula reclaimed from the sea at the intersection of North Church Street and Bodden Road. Minister of Tourism Hon Charles Clifford has confirmed that a memorandum of understanding (MOU) has been drafted for the project.
The project, tentatively priced at more than $200 million, is likely to be a public-private partnership with property developer Atlantic Star Ltd. Constructed on a “build-operate-transfer” basis, the new facilities will also involve creating two long-awaited $80 million passenger berths at the Royal Watler Terminal, where Atlantic Star is likely to gain almost 100,000 square feet for development of retail operations such as a hotel, shops and restaurants.
The cargo-port development, on 9.5 acres of land already aggregated by reclusive property and construction magnate and Atlantic Star chief Fayed al-Rasheed - better known locally as “Fahad”, and described as a “Saudi Arabian-American-Caymanian” - will comprise short-term storage and marshalling facilities, and an internal road network on the inland side of North Church Street adjacent to the Atlantic Star headquarters.
Repeated attempts to contact Mr al-Rasheed by telephone and email over several weeks proved fruitless.
The project will also involve wholesale reconfiguration of area streets, entailing either construction of an alternate road system or the expansion of Bodden Road, Eastern Avenue, Godfrey Nixon Way, the Butterfield Roundabout and Industrial Park thoroughfares to accommodate traffic between the new port and long-term cargo storage opposite North Sound Way’s Alissta Towers.
“We have drafted a memorandum of understanding and we hope to sign within two weeks,” said Mr Clifford. “The memorandum will trigger detailed negotiations and an environmental-impact assessment.
”The financial modelling has not [been determined] yet,’ he said, but would broadly require Atlantic Star to fund and manage most of the project, minimising public outlays.
“Building the facilities will be strictly private - they would put out the tenders, and that $200 million is likely to be divided, and most likely funded by the private sector,” Mr Clifford said, describing Atlantic Star’s role.
Government, however, “is not going to relinquish control of such key infrastructure. We will remain in control, but, of course, the developer wants a return on his investment, and so we may take a different approach.”
Clifford said that, depending on how the project is executed, initial cruise terminal operations could begin in as little as 18 months.
“From our point of view, we have two options,” he said. “We could build the cargo and then do the cruise facilities, but we want to be ready for the new Genesis class [of cruise ships], which will not tender.
“So we need the facilities [quickly]. We may build one pier, for two ships, to Genesis-class specifications, then build out the cargo completely, then come back and finish the cruise berthing.”
Genesis is the project name for the latest and largest generation of cruise ships, built by major shipping lines at a cost of US$1.5 billion per vessel, and carrying 6,000 passengers. Scheduled for launch in 18 months, the ships are too big for ship-to-shore passenger tenders, which can accommodate only between 250 people and 300 people per trip.
Royal Caribbean and Carnival cruise lines carry 75% of the Cayman Islands nearly 2 million cruise visitors per year. Last year, both had agreed to fund construction of two piers at the Royal Watler Terminal, with the proviso that government would, in the medium term, move George Town’s cargo docks to another location.
“They saw the value in separating the cruise and cargo, but didn’t want to pay for the new cargo port,” the Minister said. As negotiations froze, “this other person came along”, he said, declining to identify Mr al-Rasheed prior to the MOU, “and said he’d like to develop a pier on our existing site and another one on his North Church Street property.”
The two ultimately agreed to create a North Church Street cargo terminal and four berths at two piers at the Royal Watler site.
The arrangement, Mr Clifford said, would boost “cruise operations and the embarkation and disembarkation experience”, while enabling improvement of the downtown area, boosting business at local shops and restaurants, and clearing industrial traffic from the area.
The cruise lines, Mr Clifford said, “are still involved with this, support it and are keen to be involved with the design and possibly even investment”.
The Minister said the project had been kept under wraps while he negotiated the MOU, but that it would go to Cabinet in approximately two weeks, and then to public discussion in another three weeks to four weeks.
“There will be opposition, yes, “ Mr Clifford said, “but Government cannot serve just a single interest. It must weigh all the stakeholders’ interests and then must decide in the best interests of the country.”
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Cayman Islands - Cay Compass News Online - Port MOU signed
Port MOU signed
By Cliodhna Doherty, cliodhna@cfp.ky
Thursday 31st July, 2008 Posted: 15:47 CIT (20:47 GMT)
The first step towards Grand Cayman having cruise berthing facilities for four ships in George Town has become a reality.
A Memorandum of Understanding was signed on Tuesday by the Cayman Islands Government, the Port Authority and property developer Atlantic Star Ltd. for the redevelopment of port facilities.
This will include the separation of cargo and cruise facilities, with cargo facilities being moved north of the port and cruise berthing facilities (for four ships) being built at the existing port site.
The relocation of the cargo dock becomes possible because Atlantic Star Ltd. owns around seven acres of property north of the port, just south of Mr. Arthur Bodden’s store.
At a press conference to announce the signing yesterday (Thursday) Minister for Tourism Charles Clifford named it “a very important day for the Cayman Islands”.
The MOU, he said, will allow the parties to enter into detailed discussions on areas such as design and financial modelling for the development. The plan is to negotiate on and finalise an agreement in the next three months.
While Minister Clifford did note that he wished they were further along with the project, he said that under previous negotiations with the cruise lines, cruise and cargo facilities would have had to co–exist. “The government is much more comfortable with the idea of separate handling facilities for cruise passengers and cargo operations. We are confident the project will improve both critical port functions.”
Port Authority Chairman Wayne Panton pointed to the need to redevelop the cargo facilities noting that the amount of cargo it handled had doubled from 2004 to 2006.
“This is a long–term solution, which must meet the needs of the country for decades to come.”
An Environmental Impact Assessment will take place parallel to the negotiations.
Director of the Department of Environment Gina Ebanks–Petrie said the EIA will better inform processes such as planning permission and coastal licences for the project but will not replace the normal decision making processes.
After a process involving various stages such as data collection, oceanographic work, specialist studies and evaluation of the sensitivity of the environment to potential impact, the final stage of the EIA will then look at mitigating any adverse effects on the environment, along with looking at preferred alternative designs.
Mrs Ebanks–Petrie said the EIA will not just look at the construction but look at the operational side of the project and local stakeholders will have input during the EIA process.
Mr. Clifford said the project will allow for additional improvements in George Town and beyond the port facilities. For instance, they will look more closely at vehicular traffic control in George Town and will more than likely allow some roads to be pedestrianised. He mentioned Harbour Drive from the junction of Fort Street to Goring Avenue as an area they will look at.
He noted that when the cargo facility moves north of central George Town additional infrastructure may be need to connect that with the cargo distribution centre in Industrial Park.
Mr. Clifford said that the cruise lines will be an important partner in this redevelopment process from a design perspective and some are seeking to invest in it.
Florida Caribbean Cruise Association President Michele Paige said, “We expect this project will have a positive impact on all the players in the industry and indeed the Cayman Islands economy as a whole.”
Mr. Clifford said the negotiations will dictate the timeline for the project.
It is likely that one pier would be built first along with the cargo facility and once the cargo facility has moved the second pier would be built.
The Minister said the financing and financial modelling will come out in the negotiations. In a previous interview he did make a guess that it would take US$150 million to relocate the cargo facilities, along with an additional US$80 million to develop the cruise facilities.
Relevant stakeholders such as the Cayman Islands Tourism Association, the Association for Advancement of Cruise Tourism and the Chamber of Commerce had all been consulted and were in support of the concept, he said.
President of the CITA Stephen Broadbelt said, “We’re enthusiastic and fully support the project but that is contingent on responsible development and providing the DoE has a final say in the design.”
He said a concern would be propeller wash and sediment from ships on coral reefs.
Mr. Gary Lindsay of Atlantic Star Ltd. noted that owner Mr. Fahad Al Rashid is a naturalised Caymanian. To date the company has invested over US$60 million in land acquisition and property development in Grand Cayman.
The Minister said extensive meetings will be scheduled with all stakeholder groups and the general public in the next three months.
