Hanjin Shipping Signs Letter of Intent for Long Beach Terminal

Hanjin Shipping Co. of South Korea has signed a letter of intent to le
ase a 375-acre container terminal on the site of the former Long Beach
Naval Station and Naval Shipyard, port officials announced 15th March
. The letter precedes final negotiations on a formal lease which, when
signed, is expected to generate port revenues of $42 million per year
.
“The letter of intent indicates that Hanjin plans to lease the former
Naval site for the largest container terminal in Long Beach,” said p
ort executive director Richard D. Steinke, who signed the letter for t
he port. “Now that it is signed, we will begin lease negotiations.”
The letter spells out the terms that are expected to be finalized in t
he lease. According to the document, Hanjin will enter into a 25-year
lease for 375 acres on Pier T. The port will construct a container ter
minal on the site which will offer 5,000 feet of wharf, 50-foot water
depths, a dockside rail yard, and 12 to 14 “post-Panamax” sized crea
nes capable of unloading ships too wide for the Panama Canal.
“We are pleased to once again be involved with the Port of Long Beach
in the development of a new container handling facility,” said N.U.P
ark, executive vice president and managing director of Hanjin’s Ameri
can headquarters. “Over the years, we have enjoyed a successful relat
ionship not only with the Port of Long Beach but also with the city of
Long Beach. We are proud to be part of this community, and we are con
vinced that we will continue to prosper and contribute to the economic
well-being of the region through the development of this new facility
.’
Park said Hanjin’s new terminal is expected to employ 600 management
employees and union dock workers.
The terminal will be constructed in two phases, with the 260-acre Phas
e 1 scheduled for completion in the spring of 2002. That phase will en
compass land formerly used for the Long Beach Naval Station, the Navy
Mole(break water), and the western portion of the Naval Shipyard.
Phase 2 will include an additional 115 acres of former Naval Shipyard
Property, and will be opened in the spring of 2003.
Neither phase will include some 33-acres that have been set aside for
a ship repair facility. The Long Beach Board of Harbor Commissioners r
ecently terminated a lease with the planned operator of the ship repai
r facility due to non-payment of rent. The matter currently is tied up
in bankruptcy litigation.
The port has already cleared structures from approximately 200 acres o
f the former naval properties. Dredging of the West Basin for the term
inal is 60 percent complete, and more than half of the underground uti
lities have been installed. More than 60 acres have been paved, two-th
irds of the 1,100 wharf piles have been installed, and 450 feet of con
crete wharf decking have been constructed.
The design of Hanjin’s gate complex, the rail yard and other terminal
facilities will begin after the lease is signed.
Hanjin has been a customer of the Port of Long Beach since 1979. The c
ompany moved into its first dedicated terminal in the United States on
Long Beach‘s Pier C in 1991. Hanjin moved from that 57-acre sit to a
new 170-acre site on Pier A in September 1997.
Hanjin’s Pier A terminal is currently the largest terminal in Long Be
ach. Last year, Hanjin moved more than 1 million twenty-foot-container
units through its Pier A terminal in 1999.
Once Hanjin moves into its new terminal on Pier T, its Pier A terminal
will be leased to another steamship line. Steinke said other Port of
Long Beach customers have expressed interest in that site.