Amid rising intermodal traffic, the Port of Los Angeles plans a $130-million public-private partnership to develop a new container staging facility.
The busiest U.S. container port will build the 5.5-million square foot Harbor Performance Enhancement Center (HPEC) with Macquarie Principal Finance on Terminal Island, proximal to the marine center’s container terminals. Union Pacific and BNSF operate intermodal trains from the port.
The 110-acre hub is projected to move 3,500 truckloads per day from nearby container terminals to the HPEC staging area. The port says HPEC will improve flow, increase velocity, reduce emissions, add jobs, and enhance the efficiency of import containers passing through the 14 marine terminals at the San Pedro Bay complex. It is expected to increase productivity at the port by 10% or more.
The port complex handled a total 9.3 million TEUs in 2017, a record. Container traffic through February reached 1.5 million TEUs, up 5.6% from the same period a year ago.
“The HPEC development presents a truly unique opportunity to make the San Pedro Harbor the most competitive gateway for transpacific freight while reducing community impacts of the nation’s most important artery,” said Jonathan Rosenthal, Founder/Chief Executive of HPEC. “In Macquarie we have found an industry-leading partner that shares our commercial vision and our public/private mission – to be the first privately-owned firm that enhances the performance objectives of surrounding intermodal freight facilities throughout the United States and eventually around the world.”
Los Angeles and other West Coast ports have been struggling with increasing import volumes and limited space to handle them. They also have seen increasing competition from East Coast ports intent on attracting marine traffic from Asia through the expanded Panama Canal.
“HPEC’s innovative approach will relieve congestion throughout the region, increase cargo velocity through the Port, lower handling costs, reduce emissions, and dramatically improve freight flow efficiencies in the San Pedro Bay complex,” said Alex Cherin, Executive Director of the California Trucking Association’s Intermodal Conference. “With HPEC coming online, the trucking community and its customers will have one start-stop location to pick up and drop off containers, distributing to regional hubs around the clock. This is one of the most important projects in the nation and will be a real game changer.”
The San Pedro Bay Sustainable Supply Chain Advisory Committee of shippers, the California Air Resources Board, the Southern California Air Quality Management District, ocean carriers, terminal operators, trucking companies, labor, and environmental groups, has given the project its support.
“We are pleased to be joining forces with the HPEC team to develop a key part of one of the nation’s core pieces of infrastructure, the principal gateway from Asia and a critical component of the freight ecosystem,” said Andrew Honan, Senior Managing Director of Macquarie Principal Finance. “When completed in three years, HPEC will reduce waiting times and congestion by allowing trucks access to a staging area where pick-ups and deliveries will be streamlined.”