Ports Authority signs memo of understanding on San Juan Waterfront


By : DENNIS COSTA PACHECO
CARIBBEAN BUSINESS
Volume: 35 | No: 49
Page : 04
Issued : 12/13/2007

 Island Global Yachting on tap to develop marina at a private investment of $113.6 million; project to include 67,000 square feet of commercial space
The Puerto Rico Ports Authority (PRPA) has signed a memorandum of understanding with Island Global Yachting (IGY) toward the development and operation of the San Juan Waterfront project, CARIBBEAN BUSINESS has learned.

The signing represents the most significant step yet in bringing to reality a project that has been under discussion since the administration of former Gov. Pedro Rosselló. Originally called the San Antonio Waterfront, the project was part of the Golden Triangle initiative designed to revamp San Juan. Although the other two points of the triangle, the San Juan Convention District and the Condado Duo, are very close to completion, the waterfront initiative has lagged in recent years.

According to terms detailed in the memorandum, the marina will entail a private investment of $113.6 million and include 67,000 square feet of commercial space as well as 7,496 linear feet of piers. The project is slated for development in the area between Piers 7 and 9 in San Juan.

Seventy-six spaces for yachts of less than 80 feet and 20 spaces for yachts of more than 80 feet will be available, the memorandum added. The document also requires the building of a 240-room (equivalent to 168,000 square feet), four to five-star hotel on Pier 9.

As part of the agreement, PRPA commits to obtain the environmental and development permits necessary for projects in the area, while IGY will be responsible for permits related to construction. The agency will also take care of the demolition and repair of the wooden foundations for piers seven through 10, as well as the construction of public spaces including parks and walkways.

The duration of the agreement is for 50 years and also entails a payment of $6.75 million to the PRPA, to be paid a year after the reconstruction of the piers is completed, or three years after the signing of the development contract, whichever comes first, in addition to a $250,000 annual payment to the agency. Net operating income (NOI) stemming from the San Juan Waterfront will be distributed 75% to IGY and 25% to PRPA. It is estimated that profits will reach $20 million throughout the contract’s term.