Lease Ends Uncertainty for Red Hook Cargo Docks
The long-running battle over the future of the cargo docks in Red Hook, Brooklyn, is over.
After a five-year effort to stave off eviction and the redevelopment of the Red Hook container terminal, American Stevedoring, which has operated at least four piers in Brooklyn since 1994, signed a 10-year lease on Thursday with the Port Authority of New York and New Jersey.
The lease will allow the company to continue operating Piers 7 through 10 and the gantry cranes that sit between Atlantic and Sackett Avenues, unloading cocoa, lumber, steel, specialty foods and other cargo destined for New York City, Long Island and New Jersey.
The Bloomberg administration had long wanted to oust American Stevedoring and redevelop the Brooklyn waterfront with distributors, restaurants, luxury housing, marinas and other maritime uses, saying that most of the cargo should have been unloaded in the Port Authority’s bigger port, in New Jersey.
The battle in Red Hook mirrored the struggle under way on the Far West Side of Manhattan, and in Williamsburg and Greenpoint, Brooklyn, where once industrial neighborhoods are giving way to residential developers and gentrification.
But American Stevedoring hung on tenaciously — even as business declined because of the company’s uncertain future — filing lawsuits and lining up support from local community groups and powerful elected officials, including United States Representative Jerrold L. Nadler.
“We saved the Brooklyn port,” Mr. Nadler, a longtime advocate for the maritime industry, said on Thursday. “This is a great day for jobs in Brooklyn and for the future of maritime commerce on this side of the river. No one can turn it into a condo anymore.”
Under the terms of the lease, the Port Authority said, American Stevedoring will pay about $41 million in rent over the life of the lease. The rent, based on the volume of cargo, starts at about the same amount that it did in 1994, and escalates as the volume increases. The Port Authority will also continue to lease four container cranes and two barges to American Stevedoring.
At Port Newark in New Jersey, American Stevedoring will pay an additional $28.9 million over 10 years for the use of 30 acres and two berths, although it will relinquish 30 acres that it had used under a prior lease.
The Port Authority also agreed to New York’s request that it provide $5.6 million for economic development initiatives on the Brooklyn waterfront and subsidies for the barge operations used by American Stevedoring. Nearly half the money, $2.6 million, would serve as a credit against back rent owed by the company.
The agreement brings an end to the litigation between the Port Authority and American Stevedoring. In addition to back rent, it requires the posting of new letters of credit.
But the company will have to rebuild a business that has suffered substantially in recent years.
“We’re happy the fight’s over,” said Matt Yates, a director of American Stevedoring. “We now want to focus on putting our business back together in the best way possible.”
Janel Patterson, a spokeswoman for the city’s Economic Development Corporation, said on Thursday, “Last year, after E.D.C. decided not to take control of the Red Hook piers, we focused our resources on activating and adding industrial maritime jobs at other strategic waterfront properties in Brooklyn, such as the South Brooklyn Marine Terminal and Bush Terminal in Sunset Park.”
Until the 1960s, much of the shipping industry in New York Harbor docked in Red Hook and South Brooklyn. But most of the waterfront jobs disappeared as the Port Authority built a modern container port on the other side of the Hudson River in Newark and Elizabeth, N.J., a decision viewed with profound bitterness in Brooklyn.
New York built a small container port that opened in Red Hook in 1981 and retained a half-dozen piers for cargo operations. But critics and the Port Authority complained that it had to spend millions of dollars a year to subsidize a barge that transported containers from Brooklyn to New Jersey. The Bloomberg administration explored whether the piers might be better used by other operators and for other purposes.
Sabato F. Catucci, the president of American Stevedoring, countered that at its peak in 2003 his company moved 110,000 shipping containers, up from 18,221 in 1994, and created what was at one time the biggest cocoa port in the country. Even today, more than half the lumber coming into New York City lands on the Red Hook docks, company officials say.
American Stevedoring says that it employs 623 dockworkers, warehouse workers and truck drivers in Brooklyn, while some city and Port Authority officials puts the company’s payroll at closer to 160.
In 2005, a German cargo company backed out of a deal to bring about 60,000 freight containers a year to the Red Hook docks. The company said that the city had refused to guarantee that the terminal would continue to operate through 2009.
The city gained control of Pier 12, which had originally been under Mr. Catucci’s lease, and built a cruise ship terminal there. It planned to open a second terminal on Pier 10, but last July, city officials conceded that there was no immediate need to build the second cruise ship terminal.
The apparent death knell for the city’s plans came last fall when 21 elected officials, including Senator Charles E. Schumer, the City Council speaker, Christine C. Quinn, and Councilman David Yassky sent a letter to the Port Authority demanding that it provide American Stevedoring with a 10-year lease and drop its plans to sell the piers to the city.