CPA: Leases to be affected by seaport investment

The Commonwealth Ports Authority is looking at lease agreements that may be affected by the multimillion-dollar investment being proposed at its Lower Base seaport property.

Although there is no final lease agreement yet, CPA executive director Efrain F. Camacho said yesterday the agency is looking for alternative ways to help those who may be displaced by the move.

Allegiance Capital Corp. has proposed a $100-million investment at the Saipan port in relation to its project with the military. However, the project proposal involves the relocation of all buildings and companies in the area, including the Commonwealth Utilities Corp.’s power plant 1.

“There are no developments on Allegiance Corp. [as of today] other than CPA is working on the leases that may be impacted should the proposed project goes through,” Camacho said.

Saipan Tribune learned that a 25-year lease agreement is being drafted between the company and the CNMI government.

Based on the proposal, the whole drydock area will be used for big vessels that are expected to arrive all at the same time in the lease area. The project was reportedly approved by the military.

The whole seaplane ramp area in Lower Base currently hosts a submarine station, a restaurant, a holding area for Tinian boats, and a few other tenants. Once the Allegiance Capital agreement is finalized, all these concessionaires would need to be relocated to other ports authority properties.

In the case of the power plant, the agreement will take place between the administration and the Allegiance Capital Corp.

Camacho said CPA will need to make arrangements for the leases that are in good standing. “They will need to be moved,” he told Saipan Tribune.

Saying the project is still in its infancy, the CPA official noted that the prudent thing to do now is to “allow the early stage development to move forward.”

Camacho said the agency is now evaluating several sites for relocation but refused to elaborate when pressed. “CPA is evaluating several sites but is not prepare to disclose that at this moment,” he said.

It was earlier disclosed that the cost of relocating all affected entities would be shouldered by Allegiance Capital, including the CUC power plant.

If the project pushes through, it will be one of the biggest investments so far infused at the Saipan port.

Once the lease is signed, the processing of local and federal permits is expected within two years.

About 8,000 Marines will be transferred from Okinawa, Japan, to Guam starting in 2012. The CNMI is expected to benefit economically from the plan as a portion of Tinian will be used for military training exercises.