Teams to help PortMiami navigate construction flotilla

As PortMiami pilots a flotilla of about $1.2 billion in construction projects and expansions to fruition in the coming five years and looks ahead at $2.8 billion more capital spending to come, it is requesting approval of $17.6 million for four consultant teams to help navigate.

Equal $4.4 million contracts for five years would go to engineering consultants Nova Consulting Inc. and Tetra Tech Inc., while architectural consultants Gurre Matute P.A. and AECOM Technical Services Inc. would also each get a $4.4 million contract.

Memos from Mayor Daniela Levine Cava explain that while “the Seaport Department has an efficient Capital Development team managing numerous ongoing projects… the current volume of design and construction and its complexity requires teams of qualified architects, engineers, construction managers, inspectors, project control specialists and other similar professionals with a wide range of expertise and experience to augment professional port staff.”

Current ongoing projects, the memos say, include the building of a three berth mega-cruise terminal, a separate new cruise terminal with parking facilities, replacement of cruise berths, cargo terminal and berth improvement projects, shore power, 40-year recertification efforts, ancillary improvements for new cargo gantry cranes, expansion of cargo facilities handling Florida East Coast Railway trains where use is predicted to rise 3% this year, roadway improvements and more.

Following those projects, the consultants are to work on projects in the port’s 2035 master plan that include new cruise berths and one or more associated terminals, new cruise berthing facilities, upgrades, and expansions of the existing cruise terminals, expanded infrastructure capacity, cargo terminal yard improvements, new gantry cranes, and gate complexes.

Following on the heels of that long list of improvements, “in addition, the Seaport Department is currently developing its 2050 Master Plan and a $2.8 billion Capital Improvement Program, including various new infrastructure improvements and projects with grant funding,” the mayor’s memos say.

The memos say that the four professional services agreements “will allow [the] Seaport to gain access to subject matter experts that may only be needed for specific projects and proposed components,” plus access software and skills that the county will not need full time.

Fitch Ratings, which rates the port’s current debt for projects now underway or completed, in January assigned A ratings to multiple PortMiami bond issues. “The rating reflects PortMiami’s fundamental operating strengths, including its global leading cruise port market position and its role as one of the largest ports in the state of Florida in terms of cargo volume,” Fitch reported. “Despite increasing risks of a near-term economic recession, the port’s demand profile should remain intact.”

The port’s current capital improvement program totals about $1.9 billion through fiscal 2033, Fitch said, “and includes a new campus and redeveloped cruise terminal for Royal Caribbean Group, which is subject to the new agreements with [Royal Caribbean that the county commission approved in November] taking effect.”

“The port has made significant volume and revenue recoveries since the onset of the pandemic,” Fitch wrote. “PortMiami’s unaudited fiscal 2022 operating revenues… showed strong recovery, growing by approximately 73% from $99.4 million in 2021 to $172.4 million in 2022 (up 4% compared to fiscal 2019). The revenue recovery was supported by a return of cruise activity and a continuation of robust cargo performance.”

“Cargo volumes have rebounded significantly since the onset of the pandemic due to increased consumer demand…. Cargo volumes have softened in 2022 following the initial surge of demand, but are expected to continue increasing in 2023 given the addition of new services from ocean carriers looking for alternatives to congested West Coast and East Coast ports.”

“Cruise activity has ramped up significantly in 2022, with many cruise lines operating at over 100% occupancy in recent months after relaxing testing and vaccine requirements,” Fitch said. “In fiscal 2022, approximately 4 million passengers have sailed out of PortMiami, compared to 6.8 million passengers in fiscal 2019.

PortMiami’s cruise-related revenues in unaudited fiscal 2022 have recovered to over 90% of pre-pandemic levels.”

Fitch reported that port management expects continued growth in cruise activity and related revenues and anticipates passenger volumes of approximately 6.5 million in fiscal 2023, and annual totals to increase to about 9.4 million by fiscal 2028.