Global Ports Wins San Juan Port Concession With $425 Million Investment

The concession requires significant investment to upgrade San Juan’s cruise facilities (photo by Moebiusuibeom – CC BY-SA 4.0 license)

Posted August 17, 2022, 8:43 pm by

The Maritime Executive

The Port Authority of Puerto Rico has completed the competitive procurement process by selecting cruise port operator Global Ports Holdings for a 30-year concession to operate the San Juan Cruise Port. As part of the agreement, the company, which has made its strategy to focus on cruise terminal operations, will undertake a major upgrade of its San Juan facilities.

San Juan Cruise Port is a strategically important port in the Caribbean cruise market, both because of its location and because, unlike many ports in the region, it is also a port of call. San Juan has good commercial air links with the United States, which helped it emerge as early as the 1970s as a Caribbean home port for the burgeoning cruise industry. It continues to play this role, allowing cruise lines to develop week-long itineraries reaching the southern Caribbean.

Before the pause in cruise operations during the pandemic, approximately 20 percent of passengers passing through San Juan were embarking or disembarking on cruises, with the rest being day visitors. In 2019, Puerto Rico reported 1.8 million unique passenger visits, or 2.2 million total, counting all boarding and disembarking passengers. Approximately 400,000 passengers were passengers from the port of San Juan.

San Juan becomes the third largest port operation in Global Port Holding’s portfolio. The company also operates the cruise ports of Antiqua and Nassau in the Bahamas.

GPH expects to begin operating the facility early next year, subject to the fulfillment of closing conditions, including financing conditions. The company was selected as the winner of a competitive procurement process managed by the Puerto Rico Public-Private Partnership Authority for the cruise port concession.

Under the concession agreement, GPH will pay an upfront fee of $75 million to the Puerto Rico Port Authority and invest $100 million in improving port facilities and infrastructure. The initial investment phase will focus primarily on critical infrastructure repairs at Piers 1 and 4 and Pan American Piers, as well as upgrades to the terminal buildings and walkway.

The company has also committed to invest an additional $250 million in a second phase, which will include expanding the cruise port’s capacity by building a new cruise pier and a state-of-the-art port terminal capable of handling the world’s largest cruise ships at berths 11 and 12. The company plans to finance the investments with private capital.

In addition to investments in San Juan cruise port infrastructure, GPH says it will also invest in upgrading the cruise port experience for cruise passengers, cruise lines and local suppliers. Announcing their win, they said they will use their global experience and the company’s operating model to improve the management of cruise port operations. The company will also invest in systems, equipment and technology to improve the port’s operational efficiency and ensure environmental protection, safety and security.

“The addition of this fantastic location to our cruise port network marks a further important step in our growth strategy and will increase the volume of cruise passengers on our network to over 16 million passengers annually,” said Mehmet Kutman, CEO of GPH .

San Juan marks the company’s third port win in 2022. Earlier in the year, they announced an agreement with Tarragona in Spain and later agreements in the Canary Islands. The company’s growth and its position as a leading cruise terminal operator also attracted the interest of MSC Group, which decided not to proceed with a bid to acquire Global Ports.

Top photo San Juan Cruise Port in 2018 by Moebiusuibeom (CC BY-SA 4.0 license)

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