ATLANTA—After more than 10 years of dredging and construction, the $5 billion Panama Canal expansion opened over a year ago. The expansion doubled the storied canal's capacity by widening and deepening the channels to make room for ships nearly three times the size of what would originally pass through. Panama Canal executives predict a 16% to 17% revenue increase in 2017.
At the same time, the retail industry is seeing a growing reliance on e-commerce. The e-commerce industry will surpass $2 trillion in revenues in 2017, according to a Forbes report. And market research firm eMarketer puts that figure even higher by 2020, predicting e-commerce sales will rise to $4 trillion by 2020 and account for 14.6% of all consumer retail spending.
Especially on the East Coast, the industrial market is witnessing changing times on the manufacturing, logistics and transportation front. Monte Merritt, senior director at Franklin Street, sees the e-commerce expansion along with the Panamax discussion as both an opportunity and a challenge for ports, especially in Florida.
“Florida has 15 public seaports vying for attention and public funding, some of which comes from the state government,” Merritt tells GlobeSt.com. “That puts our state at a disadvantage with states like South Carolina, where the Port of Charleston is its only port and the area has an oceanside seaport and one inside that has a small channel. Port of Charleston is thriving because of excellent geography and a focus on this port as a singular entity in the state.”
Meanwhile, he has seen a years-long battle about Jacksonville's inland port that utilizes the Saint Johns River. For example, there is another ongoing lawsuit to protect the Saint Johns from deepening to accommodate the Panamax ships at what some say is a great environmental impact. Though the opportunities are on the horizon, he says, they are far from guaranteed. It's the same story for most ports in the nation.
At the big picture level, though, institutional players have finally recognized the value of ports, according to Ford Gibson, managing director at Foundry Commercial. Ultimately, he doesn't think any dynamic has changed, other than money flows to the product type by a much larger set of investors.
“Miami, for example, has been the major player for trade from south to north and vice versa for the last 20 to 30 years, but the amount of capital that is now focused on industrial has skyrocketed over the last few years,” Gibson says. “Additionally, Miami has the largest cruise port in the world, and more than half of ship borne cargo from Latin America flows through here. Miami also has more airline flights to and from Latin America and the Caribbean than all other US airports combined.”
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