Port Report: Seattle, Tacoma, Bremerton and Everett [June 2019 Breakfast Recap]

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Most of us know the ports in Washington as little industries within themselves, responsible for Washington’s link to international trade around the globe and the distribution infrastructure of our region. Ports also manage airports and public marinas, and support additional recreational opportunities via parks and open spaces. 

The June NAIOPWA breakfast focused on four of our region’s ports, highlighting their active developments underway and opportunities for the future. The ports’ representatives emphasized that they are focused on job creation and economic development, with significant real estate assets. According to moderator Matt Smith from the Economic Alliance of Snohomish County, a 2017 study found that 76,000 jobs in Washington are tied to the ports; half of these are tied to the real estate sector in which the ports operate.

Port of Everett
The Port of Everett is the second largest statewide in terms of exports thanks in large part to Boeing, according to Terrie Battuello, Chief of Business Development, Port of Everett. The port’s focus is on high and heavy cargos and also is making significant investments in environmental cleanup, having restored 200 acres in the last 20 years.

“It takes a balanced waterfront to be successful. Some people want all the waterfront land for recreation, but without the ports you don’t have the catalysts for many, many jobs,” Battuello said.

Among the significant developments underway through the Port of Everett is Waterfont Place Central. A Hotel Indigo, 266 apartment homes and nine new retail establishments are in the works for phase one. Potentially, the development could be home to 400 new condos in the future.

The Port of Everett is also working with WSU and University of Idaho to form a Center of Excellence for food production and create a regional hub for food processing, as well as the major redevelopment of the new ferry terminal and transit station on the Mukilteo waterfront in addition to dozens of other project either in the planning or redevelopment stages. Battuello says don’t overlook Everett. Total development dollars covering the last five years and projections for the near future top $1 billion.

Port of Seattle
The Port of Seattle is the region’s behemoth when it comes to real estate assets and economic development: It is the fourth largest container port in the United States, owns and operates SeaTac airport, manages facilities for the Pacific Northwest fishing fleet, and is the largest cruise port on the west coast and one of the largest landowners in the region.

“We have a tremendous asset base we use to support the broader community and drive economic vitality,” said Dave McFadden, Managing Director, Economic Development, Port of Seattle.

SeaTac is the fastest-growing airport in North America and is the eighth largest airport in the United States. Modernizations underway include a new international terminal, the new North Satellite terminal and a modernized baggage handling system.

The Port of Seattle land includes hundreds of acres outside the airport gates that is has developed in the past 5 years, including 150 acres in DesMoines for the FAA headquarters, the Panattoni project in Burien and a new development in SeaTac in partnership with Trammel Crow.

“We’re putting shovel to the ground and we still have at least 150-200 acres of undeveloped land that has potential," McFadden said, while acknowledging they are slowing a bit for future planning. The Port of Seattle is currently engaged in a new master planning process and environment impact process that is analyzing growth in the next 10 years.

On the waterfront, the Port of Seattle is investing more than a half-billion dollars in waterfront revitalization including a new cruise berth at Terminal 46 and light industrial/innovation center projects to support the fishing industry at Fisherman’s Terminal.

Port of Bremerton
Jim Rothlin, CEO of the Port of Bremerton, jokes that he’s amazed that people really don’t know where Bremerton is and that, in terms of size, they are a “microport” compared to Everett. But there is plenty to learn and the Port of Bremerton is working to ensure that people find out.

“We support 50 events combined between ports (Port Bremerton and Port Orchard) in the summer to get people to come down and see what we’re doing and create interest,” Rothlin said. “Quality of life is one our biggest draws.”

Rothlin says the Port of Bremerton sees themselves as a niche market that does not try to compete with Seattle or Tacoma. In addition to land, one of their strongest assets is a skilled workforce made up of tradespeople and Navy veterans who can support companies in the aerospace, marine, automobile and construction industries.

Over the past 10 years, the Port of Bremerton has transformed a former lumberyard on the waterfront into a mixed-use community of with hotels conference center, retail, restaurants, apartments condos and a public marina with 340 slips, which is full with an active waiting list. This year, construction started on the Marina Square project including 150 hotel rooms, 150 condos, restaurants and a bridge to the waterfront.

Much of the future growth will happen at the airport and industrial center, where the port owns 1,700 acres at the Puget Sound Industrial Center and has more room for development with 11 pad-ready sites with utilities. They are also expanding the general aviation airport and adding corporate air hangars, which currently has 64,000 landings/takeoffs a year.

One of the unique projects the port is exploring is transforming land near the airport into a 200-acre motorsports racing park. The track will support IndyCar style racing with four or five events per year, each drawing 20,000 people for races and concerts. It could also be used for driver training by emergency crews and as a testing ground for driverless cars. Adjacent to the track is a planned 15,000-square-foot event and technology center that will be a STEM center and hands-on training for automobile, aircraft and marine students.

In addition, the Port is also working to upgrade infrastructure to provide better access to developable land, including a 3.5-mile road extension from the industrial area to the runway area so that potential aerospace companies will have direct access to the taxiway.

Port of Tacoma (Northwest Seaport Alliance)
Four years ago, the Port of Tacoma and the Port of Seattle formed a 50/50 joint venture called the Northwest Seaport Alliance to manage cargo facilities and dock activities at both ports.Today, the joint venture oversees 2,500 acres, most of which are terminal and cargo facilities next to the water in each city. Overall, 58,000 jobs in Washington are associated with cargo activities at the Seattle and Tacoma docks, according to Don Esterbrook, Deputy Chief Executive Officer, Northwest Seaport Alliance. Since the alliance was created, the ports are experiencing a sea change in how cargo is shipped and distributed.

Two significant changes are taking place in the supply chain. First, ocean carriers are consolidating and bringing in larger loads. In the last five years, the average size of a container ship has doubled from 5,000 containers to 10,000 containers. Second, retailers want accessible, local inventory so they can guarantee two-day or next-day delivery, which has led to an increase in smaller, regional distribution centers in greater numbers.

“Our region has been a major beneficiary of these trends. The Kent-to-Sumner corridor is the fourth-largest warehouse distribution area in the county, and the fastest-growing because of our proximity to Asia,” Esterbrook said. “We have to have the warehouse and distributions systems to get this increased amount of cargo off the docks and into the distribution systems as fast as possible.”

As a result, the Seaport Alliance is looking at diversifying their value proposition. In addition to being the facilitator of cargo, they are starting to look for development partners of inland hub operations where they can help manage and market warehouse distribution centers and provide access to rail and truck transportation services.

Esterbook says this trend is not changing. The Pacific Northwest will remain a hot market because of the upsizing of vessels and demand for product at local facilities.

This article was written by NAIOP Washington State member Renee Gastineau, Paladino and Company

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