The port has worked with Hanjin since 2004 to bring South Korea's largest shipping company to Jacksonville. The deal slowed after Hanjin decided it needed to bring 8,000 TEU ships into the port to make the close to $300 million terminal financially viable.
Those ships would not be able to call on Jacksonville ports with their 40-foot depth, according to Schleicher.
"We have been negotiating with Hanjin on the future of the terminal for a few months now and we have come to an agreement that Hanjin is not going to build a terminal in Jacksonville," said Schleicher.
"They have agreed to commit all nine of their vessels to JaxPort and they will most likely go to the TraPac terminal," said Schleicher.
The agreement both parties signed in December 2008 required the port to pursue a depth of 50 feet because each agreed a guarantee of 50 feet relied on available funding and the approval of the U.S. Congress, according to the contract.
The timeline for the start of construction was amended in 2011 and was scheduled to start 18-24 months later.
The port received clarification in 2011 that if 50 feet could not be reached, then matching the depth of the Savannah channel of 47 feet would be acceptable.
The port has requested the U.S. Army Corps of Engineers dredge the local shipping channel to 47 feet and the request is currently being processed by the Corps.
During the past five years Hanjin has been involved in building terminals in other parts of the world.
"During this time that we were negotiating, Hanjin had built a terminal in Busan (2009), Korea, built a brand new terminal in Algiceras (2010), Spain, and they were partners in building a new terminal in Vietnam (2011)," said Schleicher.
The expansion of the company has caused it to rethink its plans at JaxPort.
"They spent a lot of money and when you look at the financial statements of the steam ship lines and they are all hurting pretty bad, so (Hanjin) had to make a decision. They chose not to invest in any more terminals," said Schleicher.
Former JaxPort CEO Rick Ferrin announced at the original contract signing in 2008 the Hanjin deal would bring an estimated 5,600 direct and indirect jobs and $1 billion in annual economic impact.
Despite the decision, Schleicher said he didn't see the news as a loss.
"We will have all nine Hanjin ships calling on JaxPort, with new service from the CKYH (Cosco, "K" Line, Yang Ming, Hanjin) Alliance," said Schleicher.
He also talked about how the cruise ship terminal on the property annually brings in $4 million in port revenue. Also, the port may have had an agreement with Hanjin for the property, but it has been listening to parties interested in the land.
"We have never stopped marketing that terminal. Even though we have an agreement you still have it in the back of your mind, 'What happens if this falls through.' You have to have backup," said Schleicher.
Former JaxPort board of directors Chairman David Kulik, who worked with Schleicher and Ferrin to bring the terminal to the port, said he had mixed feelings about the suspension of the project.
"It's disappointing that the project is not going forward, but that is not a bad outcome. Hanjin and their partners are going to be able to take advantage of the Jacksonville port and, long term, you don't know where that is going to go," said Kulik.
"(Cosco, "K" Line, Yang Ming, Hanjin) are four big carriers and that is big news for Jacksonville," he said.
Schleicher said he was not worried about finding another customer for the property, and was open to the possibility of revisiting plans with Hanjin.
"Would we be willing to work with them again? Of course, I said we would. The door is going to be open for everybody," said Schleicher.
Not only does the port have a valuable piece of property to sell, it also doesn't have to provide $300 million through bonds to build a terminal.
The money can be better used to help pay for the harbor deepening project, repairs at the port and cranes, said Schleicher.
JaxPort may use eminent domain for ICTF project
JaxPort staff will ask its board of directors Monday for permission to use eminent domain to obtain property for its proposed $45 million Intermodal Container Transfer Facility at the Dames Point Marine Terminal.
The port had an agreement with St. Johns Jacksonville LLC to purchase a 2.4-acre parcel of land for $2 million from the 37-acre parcel it was purchasing, but the company is no longer pursuing the property.
The port redesigned the plans for the facility and needs less than half an acre for construction of the facility.
It plans to use eminent domain, if necessary, to acquire the land and continue the project.
"Our next step is to make a formal offer to the land owner based on an appraisal of the property that we expect to have (Thursday)," said David Kaufman, senior director of planning and properties for JaxPort.
The port is working to complete the project by the end of the summer.
Hanjin Shipping Co. and JaxPort have decided to scrap plans for a $300 million Hanjin shipping terminal on 90 acres at the Dames Point Marine Terminal, JaxPort CEO Roy Schleicher said Thursday.