NYC gears up for more cruise expansion
New York City Mayor Michael R. Bloomberg has announced agreements with Norwegian Cruise Lines (NCL) and Carnival Corporation, that will secure New York City's position as a first-class passenger ship destination. Letters-of-intent signed with the two cruise lines call for them to pay the City at least $200 million in port charges through the year 2017 to support the City's investment in improving its facilities.
The City is committing an additional $150 million to modernize and renovate the New York Cruise Terminal on Manhattan's West Side, and to create a new berth on the Brooklyn waterfront to meet the growing demand of the booming cruise industry.
Previously in January 2004, the City's Economic Development Corporation (EDC) announced a $50 million commitment to make immediate improvements at the west side cruise terminal.
As part of the agreements, the cruise lines agreed to bring at least 13 million passengers to New York City through 2017. In return, the City has committed to an ambitious redevelopment plan and giving each line preferential berths on specific piers. In addition, the City is offering the cruise lines incentives in the form of fee reductions in exchange for volume and revenue guarantees, along with providing incentives to promote growth beyond current projections.
"We are extremely pleased with this new agreement as it enables Norwegian Cruise Lines, as the pioneers of year round cruising from New York on Norwegian Dawn, to continue to grow our strong presence in the Big Apple," said NCL President & CEO Veitch. "New York City will be Norwegian's number one home port in the mainland United States, where we will offer cruises to Florida, the Bahamas, the Caribbean, Canada, New England and Bermuda - and the City's only year round ship. We are impressed by the City's commitment to the cruise industry, which recognizes the industry's significant economic impact on New York."
"This agreement represents a historic new beginning for New York's cruise industry," said Carnival Vice-chairman & COO Howard Frank. "Not only will the West Side piers see the first renovation and rehabilitation in decades but the Brooklyn waterfront will soon become a destination for the finest cruise ships in the world. This announcement reflects months of hard work, strategic negotiations and a commitment from both sides to strengthen the tourism industry that generates hundreds of millions of dollars for the City's economy. It is good news for the stevedore, the New York purveyor, the hotel bellcap and every guest who looks forward to coming to New York so that they may sail on these magnificent vessels. New York City will be the hub of Carnival Corporation's northeast operations now and for the future. This is always where we wanted to be and are delighted to partner with New York City to make this happen."
The Master Plan created by EDC, in consultation with Bermello, Ajamil & Partners, calls for the creation of four modern cruise ship berths over the next four years, with an additional expansion in the following ten years. It recommends that all new facilities accommodate larger ships by installing modern adjustable gangways and expanded pier aprons to load and unload passengers and supplies with greater speed, comfort and efficiency. New terminals will segregate embarking and disembarking passengers onto separate levels, allowing for more efficient use of space and reducing congestion caused by passengers arriving and departing at the same time.
The Passenger Ship Terminal, renamed the New York Cruise Terminal, and the Brooklyn facility will have enhanced security measures, new passenger drop-off areas and increased parking facilities. Improvements at the New York Cruise Terminal will also include a pedestrian bridge across the West Side Highway to relieve congestion outside the facility, and once the renovations are complete in 2009, it will be able to accommodate three large cruise ships.
"The cruise ship industry is a growth industry, which makes this announcement all the more important," said Manhattan Borough President C. Virginia Fields. "This is welcome news and soon we will welcome the ships, the visitors, the jobs and the revenue to Manhattan."
To determine the best location for a cruise ship berth in Brooklyn, EDC has been conducting navigation and traffic studies on the Brooklyn waterfront's Piers 7 and 12, which are controlled by the Port Authority of New York and New Jersey. The City will continue to work closely with the Port Authority to identify a mutually acceptable business arrangement to facilitate the development of the new terminal.
"This is tremendous news and I want to thank Mayor Bloomberg and the City's Economic Development Corporation for believing in Brooklyn's future as the cruise ship capital of the East Coast," said Brooklyn Borough President Marty Markowitz. "I am so pleased that Brooklynites and other cruise passengers from the metropolitan area will now be able to easily embark for the Caribbean, Canada or England right from Brooklyn, and I am confident that Brooklyn will soon become a top port of call for tourists from around the globe."
Bigger ships, new marketing practices and new routes from New York City are driving the extraordinary growth of the cruise industry. Cruise ships once built to carry a few hundred people are now being designed for more than 3,000. The number of passengers coming through the New York Cruise Terminal reached almost 900,000 in 2003, up from an average of 400,000 in the 1990s. That could climb to 1.5 million passengers by 2017. EDC recently completed an economic impact assessment on the City's cruise operations that identified more than 3,300 jobs serving the industry in 2004, with total economic activity of about $600 million, which is expected to rise to $1.2 billion by 2014.
"Our cruise terminal has not kept pace with the incredible growth of the industry in the past decade," said EDC President Alper. "That is now changing to keep New York City's cruise industry thriving, we must invest in its expansion by improving our facilities so that we can take advantage of the industry's continued growth and increase jobs for all New Yorkers."
"Expanding the cruise line industry is a crucial investment in New York City's tourism infrastructure, and I applaud Mayor Bloomberg for his leadership and support of the city's $21 billion tourism industry," said NYC & Company President & CEO Cristyne L. Nicholas. "With modernized facilities in Manhattan and Brooklyn, New York City can effectively compete for an increased share of this rapidly growing visitor market."
The New York Cruise Terminal is located between West 47th and 53rd Streets along the Hudson River and includes Piers 88, 90 and 92. Built between 1932-35 and renovated by the Port Authority in the early 1970s, the terminal is also used for trade shows. Each of the terminal's three finger piers is about 1,000 feet long and 125 feet wide. The facility has not undergone a major renovation since the 1970s, although the City spends millions of dollars each year to stabilize the piles supporting the piers and to perform emergency repairs.
The City has already started upgrading the New York Cruise Terminal to help relieve congestion during this year's cruise season. These improvements include the establishment of taxi stands across the West Side Highway, new elevators and escalators, redesigned interior spaces and life/safety enhancements.