AVONDALE, La. (AP) — The former Avondale Shipyards, where thousands of people once worked to build warships for the U.S. Navy, has now been relaunched as a new manufacturing and trans-shipment hub called Avondale Global Gateway.
Louisiana Gov. John Bel Edwards joined officials with T. Parker Host, the Virginia-based terminal operator that bought the site for $60 million in 2018, to help re-christen the shuttered shipyard Friday for its new purpose.
Edwards said Louisiana has strategic advantages including the Mississippi River and is seizing new opportunities, WVUE-TV reported.
“The iron is hot and I’m excited and we are striking and not just here at Avondale Marine but the work we’re doing at ports all across Louisiana,” he added.
Adam Anderson, chairman and CEO of T. Parker Host, said the port’s 300 employees are now handling about 100 different commodities for 50 clients and host two or three ships each week, The Times-Picayune/The New Orleans Advocate reported. But he said T. Parker Host still hasn’t finalized an agreement with any of the big manufacturing clients it is targeting as an “anchor tenant” that would attract related businesses.
“In October 2018, we took title to this idle shipyard, it was covered with weeds, derelict buildings and abandoned work spaces,” Anderson said. “Our vision was and remains to turn this shipyard into a multi-modal logistics hub and that means having ships, railcars, barges, using the unique confluence of land, river, road and rail.”
Local politicians are hoping that the “waterfront industrial park,” with access to transportation links via river barge, rail, the nearby Louis Armstrong New Orleans International Airport and interstate highways, will meet the projections of economic development groups and attract $1 billion in private sector investment over the next five years, along with thousands of new jobs and hundreds of millions in new tax revenue.
“I think that area is well-positioned to take off in the next couple of years,” said Jefferson Parish Council member Deano Bonano, in whose district Avondale is located. “I’m very pleased with their progress.”
Anderson’s plan to repurpose the site as a logistics hub for the oil and gas industry was thwarted initially by record-high waters that stalled Mississippi River commerce for the better part of 2019. The COVID-19 pandemic soon followed and then Hurricane Ida hit the area last year.
“When we bought Avondale our private equity partner asked us, ‘What’s the worst that can happen’?” said Anderson. “I said, ‘I don’t know, sometimes the river floods and you could lose a few weeks of operations. There could be a war or a global pandemic. And, oh yeah, the third thing is you could have a massive hurricane.’ So, needless to say, we’ve really taken it on the chin.”
Ida caused about $15 million worth of damage, which was only partially covered by insurance.
In addition, the company had to deal with a host of issues to rehabilitate the site, including mitigating asbestos, mercury from old thermostats, above and below ground chemicals and some radiation before finally getting the go-ahead from state and federal environmental protection agencies in August.
Anderson said it has also unexpectedly been hard to convince potential clients and other interested parties that Avondale could be viable.
“Something we underestimated is proving that the facility could actually work,” he said. “There has been a healthy amount of skepticism out there.”
By now, T. Parker Host, which has invested about $150 million in the site, was hoping to have most of its target of six “anchor tenants” in place and occupying some of the 1.5 million square feet of building space the facility has to offer. Instead, it is still working to finalize terms for its first: TOP Vegetable Oils, part of the U.S. operations of a Colombian palm oil trading company, the newspaper said.
Negotiations on that deal have been going on for about a year.
Avondale is deep into negotiations for a second anchor tenant — in “the construction industry” — and is hoping to finalize terms on that deal early next year, Anderson said.
With the addition of new tenants, it is expected that Avondale Global Gateway will eventually create 2,300 direct jobs.
Anderson said he’s “invested all his money in the world” in the project and is determined to see it succeed as a world class manufacturing and logistics hub.
“I want everybody to know that we are now officially open for business.” he said.