Pennsylvania Shortlists Two Bidders for Phila. Terminal

Pennsylvania Shortlists Two Bidders for Phila. Terminal

The State of Pennsylvania is closer to choosing a group to design, operate and maintain a major marine terminal in the former Navy Yard in South Philadelphia.

Gov. Edward G Rendell announced late Friday that the state is now down to two groups who bid on the project. The two were selected based on their responses to the first phase of the proposal process, issued May 12, 2009, for the construction and operation of the Southport Marine Terminal.

One of the teams selected was a consortium comprising Delaware River Stevedores and Hyundai Merchant Marine America. DRS is a joint venture between Carrix and Ports America, the two largest independent terminal operating companies in the United States.

The other team selected was SMT Development Partners, principally comprised of the Spanish-based Obrascon Huarte Lain, with support by worldwide port engineering firm CH2M Hill. OHL is responsible for many successful capital construction projects in the international port industry. The Judlau and Jay Cashman firms, representing construction and finance aspects of the proposal, are also components of this proposal.

These two groups will continue in the solicitation process in developing a public-private partnership that is expected to bring millions of dollars of investment to the region.
The bidding contest was supposed to happen a year ago, but four qualified bidders backed out for various reasons, including the site being too small; tight financing during the credit crunch; and proposed demands that were too focused on the engineering details. It would have cost each bidder at least $2 million just to meet the requirements of the request for proposal.

In the year since the port authority drew up the original RFP, a coalition of the proposed terminal’s supporters, including Gov. Rendell, worked to get the project off the ground. State Rep. Bill Keller (D., Phila.), a former longshoreman who sees the terminal as a way to create thousands of jobs, pushed a bill through the Legislature that would allow bidders to add another 120 waterfront acres in two parcels at either end of the original 119-acre site, and potentially more.

The port authority redesigned its RFP to avoid the traps that had discouraged the four original investors. The new RFP concentrates on the financial underpinnings of the bids and the bidders themselves, rather than on their engineering designs, which is more appropriate to the terminal’s organization as a public-private partnership.

The Commonwealth’s Department of General Services is administering the selection process. The next step in the selection process is the development of the phase two submissions by the short-listed bidders. Based upon the phase two submissions, DGS plans to announce the preferred bidder in September and reach commercial close in November.

The Southport Marine Terminal project represents the first major expansion of the Port of Philadelphia in 50 years. Located to the south of the Packer Avenue Marine Terminal, it will be supported by three Class One railroads and a network of highways to enhance intermodal opportunities. In addition, the acreage on the site offers excellent potential for future growth and expansion.

--Contact Peter T. Leach at pleach@joc.com.