CenterPoint decides against second port bid

Published 9:25 pm Thursday, July 26, 2012

A former bidder to run port facilities in Virginia has decided against lodging another proposal in the latest round of offers to the state, a Norfolk conference audience heard Thursday.

“We’re not going to bid for the port,” said Paul Fisher, president and chief executive officer of CenterPoint Properties, keynote speaker at the conference on investment, development and economic growth opportunities from the coming of megaships to Hampton Roads.

“There are some others who will come in who are leading the way again,” he said. “I commend the state for entertaining those bids.”

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Chicago-based CenterPoint made a play to operate the Port of Virginia in 2009, drawing counterbids from the Carlyle Group and a partnership between Carrix, Inc. and Goldman Sachs.

The state rejected all offers. However, it received another unsolicited bid earlier this year, from Maersk subsidiary APM Terminals, and has extended the deadline for rival bids until Aug. 13.

Despite CenterPoint deciding against another bid, “Investing here remains, and will be, a top priority” for the company, Fisher said.

CenterPoint has developed an expansive intermodal distribution center in Suffolk, whose first tenant, Ace Hardware, cut the ribbon on a 336,000-square-feet warehouse Thursday.

The Navy Exchange Command is due to open a slightly larger facility there in the near future.

“I think we have shown we are not carpetbaggers,” Fisher said, “We’re actually proud Virginians now. We spent over $50 million already in Virginia, and expect (to spend) several hundred million more.”

To capitalize on the installation of new locks in the Panama Canal, which will dramatically increase throughput, the Port of Virginia is planning a $250-million upgrade of APM Terminals Virginia and a new facility at Craney Island.

Norfolk Southern and CSX are upgrading and expanding railroads to meet the increase in demand, and Western Tidewater localities including Suffolk, due to a relative abundance of developable land, are set to attract more warehouse and distribution projects, the audience heard.

But obstacles remain. A dearth exists of the high-end “class A” developments many shippers looking to establish in Suffolk and surrounding areas demand, said Bill Throne, vice president of commercial real estate broker Cushman & Wakefield/Thalhimer.

Craig Cope, vice president of Liberty Property Trust, developer of Suffolk’s Bridgeway Commerce Park, said the city needs to make more sites available “and have the flexibility to build different-sized buildings on the same site.”

One of several other speakers at the five-hour-long conference was the supply chain director of a company that chose Suffolk for its East Coast distribution center, Ace Hardware’s Tim Duvall.

The center services eight smaller “retail support centers,” and after looking at eight ports for the new East Coast facility, Virginia — and Suffolk in turn — was selected for its unique position to handle the megaships that, thanks to the Panama project, will sail for Virginia with well over twice the cargo of current vessels.

Bobby Norris Jr., assistant general manager of its massive Williamsburg distribution center, said Walmart will soon require more real estate, indicating the search may extend beyond James City County.

“From a strategic standpoint, I’m going to run out of real estate,” he said, “and I have to have the room and the space. It’s all about real estate, and in this area, there’s going to be more companies than just Walmart looking for some big lots.”

Virginia Port Authority Executive Director Jerry Bridges said there is “tremendous opportunity through real estate and real estate development to grow this local market and create jobs.”