WICO Can Now Dock Three Mega Ships Simultaneously; Summer Calls To See Substantial Increase In 2018

ST. THOMAS — The West Indian Company (WICO) dock can now accommodate three megaships simultaneously, WICO announced Tuesday. The news was revealed during WICO’s latest board meeting, which took place on August 22.

The accommodation of larger ships was among a myriad of announcements made by Clifford Graham, WICO’s newest CEO, along with his executive staff, during the meeting. The new mega ships will approach 184,000 tons and have a capacity for 6,600 passengers. WICO staff suggested that a maintenance dredging project (alongside the bulkhead and the turning basin) be undertaken no later than the summer of 2019, so that the new class of vessel can safely transit the harbor to berth at the completed pier.

Preliminary costs are estimated to be approximately $5.2 million, with $1.7 million allocated to dredging along the bulkhead, and $3.5 million to dredging the turning basin, which is the sole responsibility of the Virgin Islands Port Authority. WICO said it is imperative that VIPA complete this work as quickly as possible, because there is private sector interest in the turning basin phase of the work.

The completed pier can now also accommodate two Oasis-class ships simultaneously, but there would need to be significant dredging at the entrance to the harbor and more expansion of the turning basin in the inner berth.

Projections

The board acknowledged the current “softness” in the cruise industry, especially during this summer of 2017. Anticipation is high, however, for the upcoming season beginning in October. The board said 71 percent of all cruise calls will berth at the WICO facility during the period October 1, 2017 to September 30, 2018, to include 84 calls during the summer of 2018 as compared to 66 calls this current summer. Discussions are continuing with the V.I.P.A. to arrive at a more equitable allocation of port dues.

Hiring of additional border agents

The board further acknowledged the continuing issues with Custom and Border Protection services with regard to foreign-flagged vessels arriving from foreign ports. There is significant business being diverted from the territory’s ports, WICO said. The board said it fully supports Governor Kenneth Mapp’s inclusion in the FY2018 budget, funding of $700,000 to hire more agents to facilitate the clearing of passengers more expeditiously, and further expressed its support for the harbor transportation initiative.

Further development

The board, in an effort to enhance and diversify its revenue base, has tasked and allotted specific funding to the Strategic Planning Committee to seek out potential investors for a public/private sector initiative to develop its seven acres of land at Estate Liverpool. It anticipates a preliminary report at the next board meeting.

Fiscal matters

With regard to fiscal matters, it was reported that WICO had closed on a refinancing package which consolidated the current loan for the inner berth project with other outstanding indebtedness. A very favorable rate was obtained for this transaction, which reduced overall debt service costs, WICO said.

Through May 30, 2017, WICO’s net result from operations was approximately $470,000 improved over the same period last fiscal year. The board passed an operating budget for the fiscal year 2018 and its forward-looking statement is that the company anticipates continued stability, but not profitability because of its significant investment in infrastructure, which WICO says benefits the entire territory.

In addition, the abrupt loss of Royal Caribbean International-brand calls to Crown Bay this fiscal year did not afford the necessary time to market the berths which suddenly became available, WICO said. These berths are currently being heavily marketed, with great interest from all of the cruise lines, according to WICO.

Mall renovations

Phase one of the repairs to the GERS-owned Havensight Mall are now complete and the tenant base is satisfied with the infrastructure improvements, WICO said. On the operational side, there is general concern about the sharp reduction in cruise arrivals and its impact on the retail business; rent structure; rent abatement; credit card fees; eviction notices, etc. The board encouraged Mr. Graham to engage in a dialogue with the administrator/CEO of GERS to bring back a joint proposal for resolving some of these issues.

It was further noted that there is a need to demolish the old warehouses and replace them with a high-end, mixed-use facility. During dialogue, Mr. Graham said he would offer the assistance of the Strategic Committee for this development project.

The board also approved a number of initiatives:

a. Approved insurance coverage for windstorm and other hazards;
b. Approved group health insurance;
c. Implemented a stricter travel policy as well as a credit card usage policy;
d. Finance committee to focus on cost saving measures;
e. Directed the CEO to commission an appraisal of the Estate Catherineberg property in the context of the PILOT credit request.
f. Directed the CEO to review all existing service contracts with a view toward renegotiating terms and conditions as necessary.

The board elected Joyce Dore-Griffin as its chair and Michael Watson as vice chair. WICO’s executive committee now includes Ms. Dore-Griffin, Mr. Watson and Corporate Secretary Edward Thomas. Two standing committees and Finance and Strategic Planning are chaired by Mr. Watson and April Newland, respectively, according to WICO.