Real Estate & Property Law

Millions to Nowhere

By Alan Ackerman

The News Tribune

Millions to nowhere Earlier this month the Port of Tacoma canceled plans to develop the Blair-Hylebos Peninsula and to build a terminal for NYK Line. It was a complex project that grew more so and eventually crashed as the recession hammered the shipping industry. The Tokyo-based shipping line is still coming to Tacoma, but will use an existing terminal.

From nearly the beginning, the project – started in 2007 – was fraught with problems, including cost estimates that ballooned from an initial $800 million to nearly $1.2 billion and a construction schedule that was virtually impossible to meet.

The port's plans to remake the Blair-Hylebos Peninsula into container terminals for shipping lines go back nearly two decades. By 2005, the timing for such a development was right.

'The market was white hot,' Farrell said in a recent interview. 'It was the time to make things happen if you were going to make things happen. We struck while the iron was hot.'

Manufacturing in China was exploding. Ports were seeing record-high import volumes. Rival ports in Southern California were congested. Shipping companies were looking for new places to expand.

The reality of the Tacoma Port is that it is like so many other ports along both coasts. When import activities were wildly flowing, only a few years ago, every major city along the ports desired to establish itself as the main port of call for Chinese imports. These projects have failed not only in places such as Tacoma, but in Jacksonville, Fla and elsewhere. The difficulty remains that the government has taken upon itself to acquire land for private companies, all in the name of the  'port authority'. One has to wonder whether there is simply too much government intervention in the process.

Full post as published by National Eminent Domain Blog on November 02, 2009 (boomark / email).