San Francisco’s idyllic waterfront – replete with joggers cruising the miles of waterfront paths, diners enjoying glorious Bay views and chefs exploring the thriving Ferry Building Farmer’s Market – was just a pipe dream two decades ago when the Port of San Francisco first proposed a new cruise terminal.
At that time, joggers along the waterfront breathed in sooty exhaust from the overhead freeway, diners shouted over the din of traffic and the Ferry Building mostly served as a sad reminder of the thriving transportation hub it had once been. Dotted with dilapidated piers and crumbling concrete pylons, the waterfront was a faded monument to San Francisco’s proud maritime history – hardly a shining example of San Francisco’s legendary beauty and sophistication.
Shaking things up
However, a few brief moments on October 17, 1989 changed all that.
The Loma Prieta earthquake that struck that day paved the way for the renaissance of San Francisco’s waterfront, setting the stage for a new cruise ship terminal at the Bryant Street Pier.
The earthquake was a double-edged sword, both destroying critical infrastructure and clearing the path for a cleaner, more beautiful waterfront. In the years following the earthquake, the controversial decision was made to not rebuild the freeway that was once a critical artery between the Bay Bridge and San Francisco’s downtown. With the hulking eyesore removed, the Port suddenly found itself with a wealth of development initiatives spanning the 3 mile length of the city’s northeastern bayside waterfront.
A new hope
In response to a Request For Proposals in 1999, Lend Lease Corporation and Mapletree Investments Pte. joined their resources and expertise to form San Francisco Cruise Terminal LLC, which presented a dynamic proposal to the Port that addressed the myriad obstacles facing the cruise terminal initiative: the high cost of retrofitting the pier, the need for both public and private space along the waterfront, the needs of the cruise ship industry in San Francisco, and the Port’s revenue needs.
After several years of planning and regulatory approvals, the original proposal was retooled as a multi-phased plan that would create not only the cruise terminal, but also a high-rise condo and a public park in the block adjacent to the pier. The innovative strategy called for a unique financing structure that addressed the Port’s financial constraints and the limitations imposed on San Francisco Cruise Terminal by a down market.
The first phase of the three-phase, $400 million project, which is nearing completion, includes the construction and sale of condominiums in a high-rise tower built on land purchased from the Port. The funds from the land purchase support the construction of phase two, a public park opposite the cruise terminal. Finally, the revenue generated above a certain threshold for the sale of the condo units will partially fund the cruise terminal development.
Modern sophistication on the waterfront
To date, the plan has been executed perfectly. The new highrise condo building – the Watermark – is in the final stage of construction, with over half of the units already sold. “We are delighted by Watermark’s extraordinary success,” said Paul Osmundson, Development Director. “Home buyers have been raving about Watermark since the project first opened the doors. Future owners are excited to be a part of the thriving new San Francisco waterfront.”
A fitting tribute
The new James R. Herman International Cruise Terminal is, of course, named after Jimmy Herman, the ILWU President and Port Commissioner who first called for the city to develop a new cruise terminal in the 1980s. The new cruise terminal will include 100,000 square feet of passenger, customs and baggage handling area and two berths. In addition, the eye-catching new development will house 325,000 square feet of office space, 180,000 square feet of retail space and 425 car parking spaces. In addition to welcoming visitors in style, the new terminal will greatly enhance the lives of San Franciscans as well. San Francisco Cruise Terminal LLC estimates that the new terminal will give rise to hundreds of new jobs and generate millions of dollars per year in property and sales tax revenue, to say nothing of the quality of life enhancement created by adding a world-class shopping, employment and maritime destination on the waterfront.
“The cruise terminal initiative is a critical component of the Port’s future viability,” noted Mr. Osmundson. “Not surprisingly, San Francisco has become a very popular cruise ship destination. However, right now, cruise ship visitors are greeted by a terminal built around the same time the Titanic sailed. Our goal is to provide visitors with a modern facility that welcomes them to our city and reflects the vibrant, beautiful environment for which we are known.”