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Port Authority of NY/NJ acquires property for new container terminal

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As part of its recent initiatives to position the Port of New York and New Jersey for future economic growth, the Port Authority acquired additional prime waterfront property - the 98-acre Global Terminal on the Port Jersey peninsula in Jersey City and Bayonne, N.J.

Coupled with the Port
Authority’s previous transaction in 2007 to change the use of the adjacent
Northeast Auto Terminal lease to allow for container handling, this agreement
will lead to the expansion of the Global Container Terminal to 170 acres, which
will assist in handling future cargo growth. The expanded Global Container
Terminal will become part of the Port Jersey-Port Authority Marine Terminal

Earlier this week, the Port
Authority also agreed to purchase a significant portion of the Military Ocean
Terminal at Bayonne for future, long-term port use.

Despite the global economic
decline in recent years, the Port Authority remains confident that the shipping
industry will rebound and come back strong, and the agency will make certain it
has the capacity to meet future demand as the busiest port on the East Coast of
North America.

The Port Authority remains
committed to its port facilities in Elizabeth, Newark and Staten Island,
including continued investments in the on-dock rail system and the 50-foot
channel-deepening program.

Under the Global agreement,
the Port Authority takes over ownership of the Global property and, in turn,
reaches a 37-year lease agreement with Global under which the terminal operator
will develop the former Northeast Auto Terminal property into one new container
terminal known as the Global Container Terminal as part of the Port Jersey-Port
Authority Marine Terminal facility. Global, which is owned by the Ontario
Teachers Pension Plan, will then handle the day-to-day cargo operation on the
much larger footprint.

The lease agreement calls
for revenue sharing on containers handled by Global on the 170-acre combined
facility and staged rental payments as the terminal is developed over time. In
addition, the Port Authority will provide Global with up to $150 million to
develop and construct new container terminal space. The Port Authority also has
agreed to develop a rail facility on the adjacent Greenville property that
could handle up to 250,000 containers per year.

In addition, the New Jersey
Turnpike is redesigning the 14A interchange to handle projected port traffic as
the Global terminal expands over time.

The Global acquisition and
development will relieve the State of New Jersey from a $150-million financial
obligation to the federal government to cover the cost of the 50-foot
channel-deepening project in the Port Jersey Channel.

Global currently employs approximately
350 workers at its existing terminal. It is still undetermined how many workers
will be hired to operate the additional cargo container space.

Another important piece of
the port’s long-term strategy was achieved last month when the Port Authority’s
Board of Commissioners authorized the agency to move ahead with the purchase
and redevelopment of Greenville Yards, a century-old rail yard in Jersey City,
N.J. The facility will serve as the lynchpin to removing up to 360,000 trash
trucks annually from trans-Hudson crossings and New Jersey highways by moving
New York City’s sealed containerized solid waste and other commodities by barge
and rail when the facility is opened in 2013.

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