Carnival plans to brings the largest ship in its history to Miami, docking the nearly 4,000-passenger Carnival Vista at PortMiami as part of an extended deal for subsidies from Miami-Dade County.
The extended lease with Miami-Dade’s PortMiami would extend Carnival Corp.’s tenure there through 2028, with an option for Carnival to stay through 2035. Carnival pays rent, but it also receives subsidies in the form of revenue from nearby port garages and cash paid as “marketing” incentives to promote their Miami cruises. Miami-Dade also agreed to spend up to $10 million upgrading Carnival’s port terminals.
Port officials expect the new deal to bring about $27 million to the county this year. Estimates in a memo to county commissioners show Carnival paying about $36.5 million in rent, and receiving about $9.5 million back in county incentives.
Both the subsidies and the rent should climb each year as Carnival attracts more passengers. The port expects Carnival to attract about 1 million PortMiami passengers in 2015. (The official estimate is 2.1 million passenger “moves,” which counts when a passenger boards a ship at PortMiami and when the same passenger leaves a ship at PortMiami.)
A port memo describes the Vista berth as an incentive that the world’s largest cruise line offered Miami-Dade in negotiations. Carnival had not disclosed where the ship would be based before Tuesday’s meeting of the Miami-Dade commission, which unanimously approved the new PortMiami deal. The current lease expires in 2018.
Broward and Miami-Dade largely compete for the same ships, since the popular Caribbean routes can start in either Fort Lauderdale or Miami. PortMiami Director Juan Kuryla said Tuesday that the possibility of a Carnival move was a factor in the deal making.
“We never wanted to reach a point where they would start looking at Port Everglades,” he said.
Terry Thornton, senior vice president of itinerary planning for Carnival Cruise Lines, told commissioners the 10-year deal demonstrated the value of Miami to the cruise line. “This shows how much we believe in the home-porting of our vessels in Miami-Dade County,” he said.
Carnival Corp., a publicly traded company with headquarters in Doral, reported about $16 billion in revenue last year. Carnival is PortMiami’s largest cruise line, accounting for about half of the passenger volume. Norwegian Cruise Line is second, with about 30 percent of the business, followed by Royal Caribbean at 15 percent. Both Norwegian and Royal’s leases at PortMiami expire in 2021, Kuryla said.
The deal requires Carnival to sail the Vista out of Miami for at least 24 months in the three years after the ship launches in 2016. Set to be the biggest ship in Carnival’s fleet with room for 3,936 passengers at double occupancy, the Vista has attracted high interest from the cruising press with its onboard brewery, IMAX Theatre and suspended cycle ride.
Carnival announced last month that Vista will make its debut May 1, 2016 in Italy and sail 18 voyages in Europe before repositioning to New York for sailings that start Nov. 3. The company had not said where it would go after New York.
The 1,055-foot vessel is under construction at the Fincantieri shipyard in Italy. Vista’s home in Miami is expected to be officially announced next week, de Navarra told commissioners, news that will presumably come with information of Caribbean itineraries.
Miami-based cruise expert Stewart Chiron, CEO of CruiseGuy.com, said he wasn’t surprised to see Carnival move its newest tonnage to Miami, especially as rivals such as Norwegian Cruise Line have sent their own new ships there in recent years.
“There’s no better place for Carnival Vista than its homeport in Miami,” Chiron said in an email. “Not that it was a consideration, but there will be two new NCL ships being based in Miami by end of 2015, so it's appropriate for the latest and greatest Carnival Fun Ship to be here too. Now we’ll see if Royal Caribbean re-enters the seven-night Caribbean market with one of its new ships based in Miami or continues to defer dominance of the ‘Cruise Capital of the World’ to its competitors.”