Global Ports Holding Plc (GPH) has signed a 30-year concession agreement with the Puerto Rico Ports Authority for San Cruise Port, Puerto Rico, the world's largest independent cruise port operator announced on Tuesday.
On completion, San Juan Cruise Port, which handled 1.8 million unique passengers in 2019 (including c. 0.4m homeport passengers, i.e. 2.2m passenger movements), will become the third-largest cruise port in GPH’s global network.
Subject to the satisfaction of the closing conditions, including financing conditions, the concession’s financial close and commencement of operations are expected to occur by early 2023.
Global Ports Holding Chairman and CEO, Mehmet Kutman, said, "I am delighted that the Government of Puerto Rico has selected GPH for this public-private partnership to improve and expand San Juan Cruise Port. The addition of this fantastic location to our cruise port network marks a further important step in our growth strategy and will grow cruise passenger volumes across our network to over 16 million passengers per annum.”
San Juan Cruise Port is currently a popular transit port and homeport, often included in both Eastern Caribbean and Southern Caribbean itineraries, but its infrastructure needs significant investment to ensure continued operations over the term of the concession and to meet the needs of the modern and fast-growing cruise industry, GPH said.
Under the concession agreement terms, the company will pay an upfront concession fee of $75 million to the Puerto Rico Ports Authority. During an initial investment phase, GPH will spend approximately $100 million, primarily focused on critical infrastructure repairs at Piers 1 and 4 and Pan American Piers, and upgrades of the terminal buildings and the walkway.
The second investment phase will commence subject to certain pre-agreed criteria, including cruise passenger volumes recovering to pre-pandemic levels. In this phase, GPH will invest an estimated $250 million in expanding the capacity of the cruise port by building a completely new cruise pier and state-of-the-art homeport terminal capable of handling the world’s largest cruise ships at Piers 11 and 12.
GPH said it will also invest in modernizing the cruise port experience for cruise passengers, cruise lines and local vendors and will improve the management of the cruise port operations. Additionally, GPH will invest in systems, equipment and technology to enhance the cruise port’s operational performance and ensure environmental protection, safety and security.
"The GPH team looks forward to working in partnership with all stakeholders to refurbish and reinvigorate this leading cruise port to create a world-leading cruise port experience for the benefit of all stakeholders,” Kutman said. "Our work to transform this port will see hundreds of millions of U.S. dollars invested into San Juan Cruise Port, all financed by private capital. Our plans include building a new cruise pier, a state-of-the-art cruise terminal, and significant enhancements to the public infrastructure.”
