Hotel Development: Port Overview
By Andrew Glincher Office Managing Partner, Nixon Peabody LLP | October 28, 2008
Developers are increasingly finding alternative uses for ports. Through the years, port development has been the focus of many big cities from San Francisco to Boston and most recently, in Washington, D.C. as the nation's capital develops its Southwest Waterfront.
Ports can be an economic boom for cities. A lot of wharf property in many big cities originated because of industrial uses related to goods and the shipping industry. Over time, this eventually gravitated to office use and now has expanded to commercial and residential uses. In some cities, ports have become a tourist attraction. Port development in Boston, for example, was expedited by the Big Dig and the redevelopment that followed which drew more attention to Boston's waterfront property such as the Seaport District and the Fort Point Channel.
In Washington, D.C., currently there is more than $2 billion dollars in revitalization projects under construction along the city's rivers. On the Southeast and Southwest D.C. shores, about 2 1/2 square miles of land which were once just parking lots are now being transformed into a maritime-based mixed-use neighborhood with housing, restaurants, shops, offices and cultural attractions.
As ports generate more higher-income uses, this is good news for the real estate industry as the property values rise resulting in many redeveloped high-end apartments, condos, offices, restaurants, and of course, hotels.
What challenges do hotel developers face when building near ports or on waterfront property?
Space is always a challenge when developing along the waterfront. Lots are irregularly shaped or narrow strips. Often port areas are separated from other development by infrastructure (i.e., rail lines and highway systems that were developed to bring materials from the port inland), and are obviously limited by the water on at least one side.