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Port Everglades plans $75 million terminal upgrade to handle Celebrity Edge

Port Everglades is poised to welcome Celebrity Cruises’ newest ship, Celebrity Edge late next year and to prepare for its arrival, the seaport plans to invest about $75 million to renovate Terminal 25, its designated home.

Broward County, the seaport’s owner and operator, and Royal Caribbean Cruises Ltd, Celebrity’s parent, signed an agreement outlining basic parameters for the overhaul, which is slated to be completed by Oct. 31, 2018.

About $42 million in terminal upgrades will be tied specifically to preparations for Celebrity Edge, Steven Cernak, Port Everglades chief executive, told the Sun Sentinel Wednesday, at the Seatrade Cruise Global conference and trade show.

“These developments with the cruise lines are a good thing,” said Cernak. “The intent with developing the facility with Celebrity is to make this terminal the cruise line’s terminal of choice in South Florida, to homeport its newer, bigger and better ships.”

While details of the project weren’t released, financing for it will come from the port, which is a self-supporting enterprise fund of the county, Cernak said.

That means the port does not rely on tax dollars for its operations or capital improvements such as terminal renovations, he said. Funding for such projects comes from a portion of the port’s profits, which are reinvested to develop facilities and promote growth.

“We’re an economic development tool for Broward County, ” he noted.

The agreement signed Tuesday, also provided a framework for a new long-term business arrangement to be negotiated between the seaport and Royal Caribbean as the company’s existing contract will expire on Dec. 31, 2017.

As part of the proposed framework, Royal Caribbean would receive preferential access to Terminal 25 as well Terminal 29 and Terminal 18, the latter of which was constructed in 2009 to accommodate the company’s mammoth Oasis-class ships.

Last week, Royal Caribbean announced its fourth Oasis-class ship Symphony of the Seas would be based at PortMiami in late 2018 and would be joined by sister ship Allure of the Seas, which sails from Port Everglades.

The two Miami-bound Oasis-class ships will be accommodated in a new multimillion-dollar terminal that Royal Caribbean is partnering with Miami-Dade County to build.

“There’s competition in Miami,” said Cernak of the new cutting-edge terminal.

During the first year, Royal Caribbean would pay the county seaport a $14 “usage charge” for each passenger it moves through the three Port Everglades terminals, and the county would have an option to increase that charge starting in the second year and over the duration of its initial term.

It’s not usual for the seaport to negotiate agreements with its major cruise line partners that include terminal improvements and other concessions in exchange for an annual guarantee of cruise passenger movements and certain passenger usage fees rates.

The new agreement would take effect on January 1, 2018, and expire on Sept. 30, 2026 with options to extend the agreement for four years, followed by another five years, according to the seaport.

Final terms must be approved by the Broward County Commission.

 

asatchell@sun-sentinel.com, 954-356-4209 or Twitter@TheSatchreport

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