News & Trends
Port Real Estate Facilities Lease Structures
Port related real estate facilities need to have proper lease structures reflecting true costs, risks and financial thresholds to be achieved by ports.
- To accomplish this port’s need to have a reasonably good idea as to the basis of value for said facilities
- Leases for facilities need to consider other factors such as operating synergies and market supply and demand issues.
Port Real Estate Facilities Lease Structures
Port related real estate facilities need to have proper lease structures reflecting true costs, risks and financial thresholds to be achieved by ports.
- To accomplish this port’s need to have a reasonably good idea as to the basis of value for said facilities
- Leases for facilities need to consider other factors such as operating synergies and market supply and demand issues.
Retaining and Attracting New Business
Retaining and attracting new business through the re-use and re-development of existing port facilities and surplus lands becomes a key strategy for port growth and competitiveness.
- As competition heats up and stakeholders demand maximum performance for all port assets, port properties are coming under increasing scrutiny to produce higher return and produce more competitive advantages through the creative development of surplus lands and re-development of existing facilities.
- Re-developed port lands and facilities also benefit ports through increased property revenue streams and values and as standalone assets, all of which facilitates releasing of tied up equity for other port uses such as port modernisation and expansion.
Retaining and Attracting New Business
Retaining and attracting new business through the re-use and re-development of existing port facilities and surplus lands becomes a key strategy for port growth and competitiveness.
- As competition heats up and stakeholders demand maximum performance for all port assets, port properties are coming under increasing scrutiny to produce higher return and produce more competitive advantages through the creative development of surplus lands and re-development of existing facilities.
- Re-developed port lands and facilities also benefit ports through increased property revenue streams and values and as standalone assets, all of which facilitates releasing of tied up equity for other port uses such as port modernisation and expansion.
Port Property Valuations and Appraisals
It is now critical for ports to obtain base line valuations of their land holdings and facilities to better manage their core business. In this fashion, they can more accurately gauge the value of lying ‘within the fence’ of such a highly specialized business and logistical environment as a port to:
- Better reassess book values for property assets moving forward and to better structure leases
- Identify the real ‘market’ premium of port located real estate as leaseholds is challenging and requires an in-depth knowledge of the working dynamics of ports as a business
- Address increasing corporate reporting requirements, especially as it relates to property assets
- Better analyse and structure public private partnerships.
Port Property Valuations and Appraisals
It is now critical for ports to obtain base line valuations of their land holdings and facilities to better manage their core business. In this fashion, they can more accurately gauge the value of lying ‘within the fence’ of such a highly specialized business and logistical environment as a port to:
- Better reassess book values for property assets moving forward and to better structure leases
- Identify the real ‘market’ premium of port located real estate as leaseholds is challenging and requires an in-depth knowledge of the working dynamics of ports as a business
- Address increasing corporate reporting requirements, especially as it relates to property assets
- Better analyse and structure public private partnerships.
Panama Canal expansion will impact the us ports, but where and how might surprise?
- Larger ship classes will require deeper reach into the hinterlands and fewer ports of call to maintain financial viability, so where will they go?
- Ports will need to accommodate larger ships and increasing cargo throughput from the same footprint by more carefully integrating property uses at the port and throughout logistical growth poles.
- West Coast Gateway ports and class 1 railroads will not take this ling down and will adjust to compete to maintain market share.
Panama Canal expansion will impact the us ports, but where and how might surprise?
- Larger ship classes will require deeper reach into the hinterlands and fewer ports of call to maintain financial viability, so where will they go?
- Ports will need to accommodate larger ships and increasing cargo throughput from the same footprint by more carefully integrating property uses at the port and throughout logistical growth poles.
- West Coast Gateway ports and class 1 railroads will not take this ling down and will adjust to compete to maintain market share.
Pressing property issues as seen by major ports
Port authorities identify the most pressing current and near term property issues in a recent research paper on the state of port property written by Franc J Pigna on behalf of the American Association of Port Authorities as:
- Most ports are seriously capital constrained; the current manner of financing capital projects is no longer working
- Property portfolios need to be rationalised to enhance throughput and increase revenues; MAG rents need to be balanced with property based ones
- There needs to be a starting point from a property portfolio value standpoint to make better decisions in managing the business
- Property leases do not reflect the true costs and value of the properties being leased resulting in underperforming port properties from a financial standpoint and subsidising tenants
- There is a need for disciplined port property asset management plans to ensure portfolio financial performance
- Traditional property appraisers are challenged with a lack of knowledge of the maritime and port industries, especially in identifying a ‘highest and best use’.
Pressing property issues as seen by major ports
Port authorities identify the most pressing current and near term property issues in a recent research paper on the state of port property written by Franc J Pigna on behalf of the American Association of Port Authorities as:
- Most ports are seriously capital constrained; the current manner of financing capital projects is no longer working
- Property portfolios need to be rationalised to enhance throughput and increase revenues; MAG rents need to be balanced with property based ones
- There needs to be a starting point from a property portfolio value standpoint to make better decisions in managing the business
- Property leases do not reflect the true costs and value of the properties being leased resulting in underperforming port properties from a financial standpoint and subsidising tenants
- There is a need for disciplined port property asset management plans to ensure portfolio financial performance
- Traditional property appraisers are challenged with a lack of knowledge of the maritime and port industries, especially in identifying a ‘highest and best use’.
Port Property Insight ©
- Port Property Insight © is Aegir’s quarterly newsletter reporting on timely and impacting issues for the ‘soft’ (versus ‘hard’ or operational) side of the industry, namely issues like real estate, asset management, logistics, strategy and finance and interviews with leading industry leaders, all with a decidedly port property related perspective.
- Subscription to Port Property Insight is complimentary. Aegir does not intentionally sell, share or distribute email addresses to third parties, except as required by law, and only use this information to process your requests.
Port Property Insight ©
- Port Property Insight © is Aegir’s quarterly newsletter reporting on timely and impacting issues for the ‘soft’ (versus ‘hard’ or operational) side of the industry, namely issues like real estate, asset management, logistics, strategy and finance and interviews with leading industry leaders, all with a decidedly port property related perspective.
- Subscription to Port Property Insight is complimentary. Aegir does not intentionally sell, share or distribute email addresses to third parties, except as required by law, and only use this information to process your requests.
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