Road to success

CentrePort Canada's first-ever business plan, to be released this morning, is targeting 250 acres of development in its first five years of existence.

The relatively modest development projections are an indication of the decades-long growth trajectory that the inland port's managers have been talking about since the corporation was formed less than a year ago with a 20,000-acre footprint.

But the business plan also points out that even with only 25 acres per year developed from 2011-to-2020, it could generate up to $20 million in cumulative municipal tax revenue.

In an interview with the Free Press Tuesday, CentrePort CEO Diane Gray and chairman of the board Kerry Hawkins said great progress has been made in creating the corporation and establishing the kind of processes that need to be in place to handle development as it starts to occur.

"Considering we are not out there aggressively marketing ourselves, we have had a fair bit of investor interest," Gray said.

"We have not been able to accommodate them because of our own development timelines and we have been referring them to brokers.

"Hopefully, some will come to fruition."

The first annual business plan sets out the main activities of the corporation, including priorities in four key areas: business development, strategic partnerships, intergovernmental relations, and marketing and communications.

But the crucial development for CentrePort in the near term is to nail down commitments from the city to start construction of water and sewer services.

The province has already contracted with engineers to create a detailed design for sewer and water servicing.

Gray said the next big project is to make a presentation to city council sometime over the next few months to get the project underway.

"Before development occurs, servicing needs to be in place," she said.

"You can talk to people and they can be really interested, but if you can't give them a firm time line on servicing, you are really not in negotiation."

She said the plan has always been that servicing will be phased in over time, depending on where development interest is strongest.

At this point, that means the area west of the airport, north of Saskatchewan Avenue.

"We see that as an entry point into CentrePort where the business park is and where the Canadian Pacific rail line is," Gray said.

The other area is west of Brookside Boulevard on the north and south sides of Inkster Boulevard, where both DTZ Barnicke and CB Richard Ellis are already marketing land.

Although criticism is starting to crop up in some quarters about the slow pace of development at CentrePort, Hawkins said the board and the four-person staff have made significant progress.

"We have exceeded our own expectations," he said.

For instance, on a tour of U.S. and Mexican inland ports in January, Gray said officials from those facilities expressed envy at the level of infrastructure support CentrePort has already achieved -- including federal and provincial funding for a $212 million freeway through the inland port -- and the fact it had already secured foreign trade zone status as well as a commitment by the province and the city to make the whole development eligible for tax incremental financing (TIF).

"These are the kind of things that took some of the other inland ports much longer to accomplish," she said.

And Gray said it must be remembered that since CentrePort does not own any land, its roles is as a facilitator.

"We want to help connect the dots between various people, figure out what will make commercial connections work," she said.

martin.cash@freepress.mb.ca

Key goals and focus

CentrePort's key goals for its first five years:

Minimum of five "anchor" tenants and 250 acres of land development.

Expanded access to multi-modal transportation on the site.

Serviced and zoned land adjacent to rail activity available for development.

A plan that sets out timelines for CentrePort to be self-sustaining.

Strategic partnerships with landowners, industrial real estate brokers, site selectors and logistics organizations around the world.

Its business development focus:

Back-haul shipments to Asia and Mexico to take advantage of containers leaving the country empty.

Import of manufacturing goods for assembly and distribution to Western Canada and the U.S. Midwest.

Regional food distribution.

Staging area for distribution to Northern Canada.

Development of special businesses taking advantage of foreign trade zone status and partnerships with airport and transportation companies.

Corporation's ideas for generating revenue:

Implement a membership fee.

Referral fees as payment for successful investor referral or a percentage of leasing revenue.

Republished from the Winnipeg Free Press print edition June 9, 2010 B5