In the annual Savannah State of the Port address, Georgia Ports Authority Executive Director Griff Lynch detailed a new strategic rail initiative, 'GPA's Mid-American Arc,' and welcomed Floor & Decor's announcement of Phase 1 of a 1.4 million square-foot distribution center complex.
GPA's Mid-American Arc will focus on the growth of intermodal rail, extending the Port of Savannah's reach to capture new markets across the Southeast and Midwestern U.S. "This enhancement of our rail capacity is a game-changer in the market to serve cities ranging in an arc from Atlanta to Memphis, St. Louis, Chicago and the Ohio Valley," Lynch said. "Additional track will allow us to build unit trains, 10,000 feet long, completely on terminal, while reducing rail crossings and impact on the local community."
Included in the plan is a $128 million project that will link Garden City Terminal's two rail yards, improve efficiency and grow the terminal's rail lift capacity to approximately 1 million containers each year. The project is funded in part by a $44 million grant from the U.S. Department of Transportation.
Also at the State of the Port, Lynch announced that flooring retailer Floor & Decor will open a 1.4 million square-foot distribution center in the Savannah market. The build-to-suit distribution facility will open by 2018 and be located on 90 acres about 10 miles from the Port of Savannah. Construction is slated to begin in November 2016. The new center will add and retain115 jobs. A second phase will add another 1.1 million square feet, for a total of 2.5 million square feet.
"This is a tremendous vote of confidence in the Georgia Ports Authority and the future of the fast-growing market of the U.S. Southeast," said GPA Board Chairman Jimmy Allgood. "It comes on the heels of a year in which millions of square feet of industrial and warehouse space were opened or announced across Georgia, accounting for more than 3,800 port-related jobs, and half a billion dollars in investment."
"We are excited to expand our distribution footprint in Savannah. We looked at other East Coast opportunities, but the combination of the Georgia Port Authority, SEDA and the local logistics and distribution services could not be better for Floor & Decor than here in Savannah," said Floor & Decor's Executive Vice President Supply Chain Brian Robbins. "It's just a great place to do business, especially when you look at the future investment being put into Savannah's port and distribution business."
Duke Realty, which will construct the 1.4 million square-foot facility with Floor & Decor, worked closely with the Savannah Economic Development Authority on the transaction, which represents one of the area's largest development projects.
Lynch thanked the entire Georgia team, including Gov. Nathan Deal's office, the Georgia Department of Economic Development and SEDA for their work in winning this competitive project for the state. Lynch noted the market is still calling for additional construction, citing a vacancy rate of just 1 percent for sites greater than 100,000 square feet. "Savannah is the No. 2 growth market in the nation when it comes to absorption as a percentage of building inventory. Over the past 15 years, our cargo expansion has outpaced all other major U.S. container ports. The public and private investments we are making now will ensure Savannah remains at the forefront of global commerce."
In his first address as executive director, Lynch also reported on the authority's performance during Fiscal Year 2016, which ended in June. The GPA moved 31 million tons of cargo and 3.6 million twenty-foot equivalent container units in Fiscal Year 2016. It is the second straight year that TEU volumes topped 3.6 million. Despite a decrease of 1.3 percent in containers for FY16, combined annual TEU growth for FY15-16 reached 15.4 percent.
The Savannah State of the Port is a joint effort of the GPA and the Propeller Club. "The Savannah chapter of the Propeller Club is honored to partner with the Georgia Ports Authority to host one of the most successful logistics industry events in the state," said Propeller Club President Craig Maggioni. "The Savannah State of the Port is really an unmatched networking opportunity for professionals from the many facets of the maritime trade."
FACT SHEET
GPA's Mid-American Arc
The Port of Savannah's Garden City Terminal is the Southeast's busiest intermodal gateway. However, the GPA is making a series of infrastructure improvements that set the stage to capture greater market share. Savannah is poised to rapidly increase service to an arc of inland markets, from Atlanta to Memphis, to St. Louis, Chicago and the Ohio Valley.
Key to expanding rail service is a $128M project linking Garden City Terminal's two rail yards. Construction of the rail expansion, forming the Port of Savannah International Multi-modal Connector, will take four years.
- Improves efficiency and grows terminal rail lift capacity to approximately 1 million containers per year.
- Allows GPA to build 10,000-foot long unit trains on terminal without disrupting nearby traffic.
- Funded in part by a $44M grant from the U.S. Department of Transportation.
Unit train capacity on terminal will build density into the system, and make faster, more frequent rail service to markets along the Mid-American Arc attractive to rail providers CSX and Norfolk Southern.
Key advantages to GPA's Mid-American Arc
From ship to shore to on-terminal rail, the speed and efficiency of GPA's intermodal services are unmatched. With the addition of the multi-modal connector, service to Mid-American Arc cities becomes more competitive.
- GPA already features 25 trains per week to and from Mid-American Arc locations. Unit train capability will provide a new option, delivering reliable, consistent access to the Southeast and Midwest.
- Savannah currently offers the fastest westward transit times in the South Atlantic region, including overnight service to a five-state area - Alabama, Georgia, Florida, North Carolina and South Carolina.
- Port of Savannah customers moving containers by rail enjoy superior speed and reliability, with most cargo moving from vessel to rail within 24 hours, and guaranteed 24-hour service for priority boxes.
- Savannah is just over 1,000 miles from Chicago by rail - comparable to other ports that are north of Savannah, but also farther east.
- Savannah rail providers Norfolk Southern and CSX Transportation provide double-stack container trains along the entire route between Savannah and the Midwest.
- Congestion-free movement from ship to rail cuts expenses and speeds delivery directly to the customer.
- As the first port of call on many Panama Canal shipping services, the Port of Savannah provides additional assurance of on-time cargo arrival.
Other components to GPA's Mid-American Arc
At 1,200 acres, Garden City Terminal has the scale to handle massive cargo exchanges from neopanamax ships, as well as the equipment and expertise to quickly move cargo to rail. Other factors enabling GPA's superior velocity include:
-Garden City will add eight ship-to-shore cranes by 2018, for a total of 30. The largest single-operator terminal in the nation, Garden City features 146 rubber-tired gantry cranes for on-terminal container handling.
-The Savannah Harbor Expansion Project, now under way, will deepen outer harbor to 49 feet at low tide (56 feet at high tide), and the inner harbor to 47 feet at low tide (54 feet). Completion expected in 2020.
-Expanded Panama Canal can now handle up to 14,000-TEU vessels, which provide lower cost per container slot -shifting Savannah's competitive market westward by lowering the overall cost to reach inland markets.