Miami

Royal Caribbean is negotiating a deal with Miami-Dade County in which the cruise line will pay for a brand new cruise terminal in the northeast section of PortMiami.

The Miami Herald is quoting county officials, who say a preliminary vote is set for Wednesday.

The berth will be 400 meters long and could fit an Oasis class cruise ship or something larger, according to deputy port director Kevin Lynskey.

The proposed deal would be between 20 and 60 years and there is no indication yet which ships would be coming to the port, but both sides have, "expressed interest in having one of the megaships based in Miami."

The new terminal would be called Terminal A and would be ready to open in late fall 2018.

Royal Caribbean is part of a coalition that is in opposition of plans to build a 25,000-seat soccer stadium in PortMiami.

The coalition is called, "Miami Seaport Alliance" and is against the plans. Royal Caribbean's opposition stems from the fact the stadium would be located adjacent to its headquarters.

The coalition cites concerns congestion in the area that is already congested.  Miami Seaport Alliance president, John Fox, commented on the idea, "When there’s a Heat game, or things going on at the Arsht Performing Arts Center, we now have an art museum that’s fantastic, there’s a children’s museum there, there’s a science museum coming,” Fox said. “And so, even forgetting the cruise and cargo interests, there’s horrendous, horrendous traffic problems."

Fox is the former vice-president of government relations for Royal Caribbean.

The group includes seven or eight members, according to Fox, which includes Royal Caribbean, labor unions, freight forwarders and other companies.

The soccer stadium proposal is championed by soccer star David Beckham.  Beckham prefers the stadium in the port because of the downtown Miami skyline view.

Royal Caribbean has announced it is against a plan to build a new soccer stadium in PortMiami because of traffic concerns and because the cruise line has its own ideas for the land.

The Miami Herald is reporting that Royal Caribbean has its own confidential plans to develop the 12 acres that Beckham and his investors want to lease. 

Soccer star David Beckham is behind the soccer stadium plans but Royal Caribbean cites "deep reservations" over the port stadium. If the stadium were to happen, Royal Caribbean's existing parking lot, daycare center and employee gym would need to move to make way for a stadium that could contain 25,000 to 40,000 seats. The port’s southwest corner is too shallow to accommodate cruise or cargo ships.

Royal Caribbean vice president and chief communications officer, Rob Zeiger, commented briefly, “We have deep reservations about using this port as a location for a stadium."

Royal Caribbean chose not to elaborate more on its own plans.

With the busy fall and winter cruise seasons approaching, Miami, Florida is typically a hub of cruise line activity but this year Royal Caribbean's global plans have left Miami with less ships than it's used to.

Royal Caribbean has 11 ships in Europe this summer but only two will be sailing out of South Florida this winter and both are in Port Everglades.  Instead of mooring in Miami, Royal Caribbean is basing them out of pots such as Baltimore, Port Canaveral, Tampa, San Juan, Dubai and Brazil. And Royal Caribbean’s two ships based in Alaska during the summer are going to Australia for the winter, not Miami.

So what's left in Miami this winter?  Just one ship will be sailing out Miami and that's Majesty of the Seas, which is offering three- and four-night cruises to the Bahamas.

Royal Caribbean's headquarters will remain in Miami, Florida until at least 2021 under the terms of an agreement approved Tuesday by the Miami-Dade County Commission.

Rent for Royal Caribbean in August 2015 will go to $3.8 million per year for the three building complex.  Miami deputy port director Juan Kuryla characterizes the price as "far below market value" but the deal will keep Royal Caribbean in the area for the foreseeable future.

The new agreement is good for ten years and includes clauses for two five-year renewals.

In addition, the port of Miami will be obligated to make $850,000 worth of repairs to the three buildings over the next couple years.  In addition, both Royal Caribbean and the Port of Miami will make $6 million in improvements to Terminal G. Miami-Dade county will pay $3.5 million and Royal Caribbean will pay $2.5 million.

What does this get Miami?  Royal Caribbean guarantees to bring in at least 325,000 passengers a year at Terminal G, a figure that is lower than years past. However, if Royal Caribbean reaches 375,000 passengers, Royal Caribbean is entitled to a discount on port fees that increases with every additional 50,000 passengers.

Royal Caribbean announced at a Miami-Dade County committee meeting yesterday that they have negotiated an agreement with Miami-Dade County and Port to keep its corporate headquarters in Miami, Florida. Royal Caribbean also struck a deal to continue using a cruise terminal there as well.

Prior to the announcement, some speculated about Royal Caribbean's plan to keep its headquarters in Miami with the building lease coming to an end in 2011 and 2014.  Back in 2010, Royal Caribbean chairman Richard Fain declined to comment on on future plans about the headquarters or future sailings from Miami.

Royal Caribbean senior vice president of land operations, Craig Milan, talked about the negotiations to keep Royal Caribbean in Miami, “We’ve been going through this negotiation process for many months now, and like any long-term relationship, you have your ups and downs.  Fort there’s been a lot more ups than downs, so we’re really thrilled we’ve come to this agreement and we’re going to be here for a long time to come.”

Considering Royal Caribbean had placed its largest and newest ships (Oasis and Allure of the Seas) in nearby, and competitor, Fort Lauderdale, it made sense perhaps for Royal Caribbean to move its headquarters north as well.

The Port of Miami is working on a plan that would allow it to handle Oasis of the Seas sized ships and compete better with other ports, such as its neighbor to the north, Port Everglades.

A $250 million plan is still being kept under wraps but would center around upgrading the cruise facility to handle larger ships.  In addition it would include the construction of a "multi-terminal — a single terminal that can accommodate more than one cruise vessel," according to Kevin Lynskey, port director of business initiatives.

Work on any new terminal wouldn't start for at least four of five years according to Lynskey.  He also believes the Caribbean cruise market will continue to grow yearly over the next 10 years.

A greater issue would be how the new project would be financed.  Currently the port owes a little more than $490 million in debt with revenues at around $110-115 million.

Port Everglades, in Fort Lauderdale, Florida, is gaining ground quickly on Miami, Florida for most cruise passengers in the world.  Miami has been the traditional "cruise capital of the world" for many years but recent changes have made Port Everglades, located just 28 miles to the north, a close competitor.  If current trends continue, Port Everglades will overtake Miami by 2012, thanks to in part, Royal Caribbean.

Liberty of the Seas, currently serving Europe, will return to the United States next year and has been announced to call Port Everglades it's home port.  Oasis of the Seas and Allure of the Seas, the two largest cruise ships in the world, already call Port Everglades home.  This leaves just Majesty of the Seas left in Miami as Royal Caribbean's presence.  

Royal Caribbean Cruises Ltd.'s level of commitment is less clear. Richard Fain, chairman and CEO of Royal Caribbean Cruises Ltd., declined to comment on its future plans to sail from Miami, nor would he say whether Royal, which owns several brands including Celebrity Cruises and Azamara Cruises, intends to keep its headquarters at the port after its building leases expire in 2011 and 2014.

Miami, for it's part, admits it needs to do more to lure Royal Caribbean back to Miami.  Recently the port of Miami inked a deal with Carnival to keep Carnival in Miami until at least 2018 and County Manager George Burgess said, "We need to roll up our sleeves and negotiate with Royal, just like we did with Carnival".

Port Everglades earned a lot of Royal Caribbean's new found loyalty thanks in part to how it handled the Oasis of the Seas situation.  When Royal Caribbean was shopping for a home port, it received a lukewarm reception from Miami but Port Everglades agreed to double the terminal budget from $37.4 million to $75 million. Royal Caribbean then promised to send even more passengers to Port Everglades to compensate for the extra cost of the 5.5-acre super terminal, which has 90 ticket counters.