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Port Shores Up Tampa's Economy

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By TED JACKOVICS

The Tampa Tribune

Published: September 11, 2008

TAMPA Economists say there's a bright spot to be found in one of the Tampa Bay area's rougher edges: the Port of Tampa.

A report this year by Moody's cites the port as a significant long-term catalyst countering trends weighing on the Bay area's economy, such as the steep decline in real estate values and a weak job market.

"A key source of strength is international trade," Moody's analyst Chris Kafakis wrote about Tampa in March.

The port's geographic location will help fuel growth.

"Tampa's close proximity to Latin America gives it a comparative advantage to more northern ports such as Jacksonville, Savannah and Charleston, S.C.," Kafakis said.

Meanwhile, a midyear national industrial report by the Phoenix office of Encino, Calif.-based industrial real estate company Marcus & Millichap also cited the Port of Tampa as a key attraction for investors to the Bay area.

"The Port of Tampa is helping to keep the metro's vacancy rate in check, allowing for steady rent growth, as an elevated level of imports is generating demand for industrial space," Marcus & Millichap said in its report.

Tampa fell from 14th to 15th in a ranking of metropolitan areas in Marcus & Millichap's 2008 midyear U.S. economic report, which analyzes employment, construction, vacancies and rent growth.

The company ranked Los Angeles atop its national industrial index, in part because of healthy activity at the Los Angeles and Long Beach ports. Increased seaport activity helped Portland, Ore., rank fifth and Oakland, Calif., rank sixth.

Despite uncertainty in the housing markets, the long-term outlook for Tampa looks positive, thus the area continues to draw investors to Tampa's industrial market, Marcus & Millichap said.

Among port-related projects helping to fuel the local economy:

• The port was a catalyst for the new Madison Business Center, a 60-acre industrial development. It will include the Tampa Bay area's largest speculative industrial building in recent times, said Rick Narkiewicz, first vice president, industrial properties, for CB Richard Ellis' brokerage services in Tampa.

He's marketing the center to regional and national distributors that want access to Tampa, Orlando and South Florida, and manufacturers that could market products regionally and through the port.

One of five buildings planned at the site east of U.S. 41 and about four miles south of the Selmon Crosstown Expressway has been leased to American Tire, with 147,000 square feet. A second building, with 385,000 square feet, was completed a few weeks ago, offering the largest block of space available in Tampa, Narkiewicz said.

• Titan Metals, a steel processing company, and the Andino and Gaetano Cacciatore cement projects were developed at the port because of the international shipping access to Central Florida markets and beyond.

• Because of the improvements in direct container cargo service from the Far East to Tampa, the regional warehouse for Beall's Inc. in Bradenton is now being stocked by trucks coming from the Port of Tampa rather than by trucks traveling from the Port of Savannah in Georgia.

"It is the ports along the Gulf of Mexico that are showing gains and should be able to become even more competitive in the future," Tampa port director Richard Wainio said. "The $5 billion-plus project to expand the Panama Canal by 2014 will bolster Tampa cargo opportunities."

Even sooner, Port of Tampa trade should benefit from increased direct container cargo services from the Far East, overcrowded conditions on U.S. West Coast ports, and rising truck and rail rates.

"High fuel prices are causing importers and exporters to rethink their logistics and supply chain strategies to reduce their inland rail and trucking costs," said Wade Elliott, the port's senior director of marketing.

"This trend is helping favor Tampa, as shippers are opting to move more cargo using the more fuel-efficient water mode of transportation and the Panama Canal, as opposed to discharging their containers on the West Coast, such as Los Angeles and Long Beach, and delivering them by rail and truck to the Eastern Seaboard," Elliott said.

"Similarly, Central Florida importers and exporters can save on trucking and diesel fuel surcharges by having their containers move via Tampa, as opposed to East Coast ports such as Savannah and Jacksonville or Miami and Port Everglades."

Gulf ports, such as Mobile and Houston, are expanding along with the Port of Tampa, which plans to increase its container facility from 25 to 128 acres, extend berths and acquire additional cranes.

"These ports complement, rather than compete, with Tampa," Elliott said. "They will help us attract more container services as shipping lines see opportunities in having their vessels call at three ports."

The payoff will be more local jobs, said Jim Renner, the port's senior director of real estate. The port authority says operations are responsible for nearly 90,000 jobs directly and indirectly in and beyond Hillsborough County.

Although no one can predict specific numbers of new jobs, port officials said in August that they anticipate tripling the number of containers handled in Tampa - from 42,000 this year to 125,000 by 2011.

Reporter Ted Jackovics can be reached at tjackovics@tampatrib.com or (813) 259-7817.

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