Galveston Wharves’ $157M Bond Sale Generates $1.8B in Orders

Galveston, TX (July 31, 2024) - The Galveston Wharves has successfully priced $156,835,000 in revenue bonds for construction of the port's fourth cruise terminal, with the sale generating more than $1.8 billion in orders from investors on July 25. As a result of the strong demand, interest rates were lowered, which generated approximately $2 million in total principal and interest savings for the port.

Rodger Rees, Galveston Wharves port director and CEO, said, "Investors recognized the port's financial resiliency, quick recovery after Hurricane Beryl on July 8, growth trajectory, strong management, recent rating upgrade from Standard & Poor's, and a positive outlook from Fitch."

The Port of Galveston is the fourth busiest cruise homeport in the U.S. and the only in Texas. It welcomes about 1.5 million passengers a year sailing on major cruise lines, including Carnival, Disney, Norwegian, Princess and Royal Caribbean.

Co-managers for the financing are Hilltop Securities and Piper Sandler Companies.

New Terminal Opening in 2025

Construction has already begun to convert an existing cargo warehouse into the 165,000-square-foot cruise terminal at Pier 16. The $96 million cruise terminal project will include marine work on the pier, two passenger boarding bridges and ground transportation areas.

In addition, the port will build a $55 million onsite parking garage for approximately 1,700 vehicles. The estimated $151 million project will be funded with port cash reserves and revenue bonds.

The new cruise terminal will open in November 2025 to homeport the MSC Seascape. The Galveston Wharves and MSC Cruises, a leading international cruise company, finalized an operating agreement for the complex in early 2024.

Under the 20-year agreement, which includes four 5-year extension options, MSC will have a set cruise schedule beginning in late 2025 when the terminal opens. The port also can negotiate with other cruise lines to use the terminal based on availability.

About Galveston Wharves at the Port of Galveston

Located at the entrance to Galveston Bay and the Houston Ship Channel, Galveston Wharves has been a thriving maritime commercial center since 1825. Just 45 minutes from open seas, the 840-acre port has infrastructure and assets to serve growing cruise, cargo and commercial businesses.

As the fourth most popular U.S. cruise port, Galveston welcomed almost 1.5 million cruise passengers in 2023. As one of the busiest cargo ports in Texas, Galveston moved 3.8 million tons of cargo in 2023 and has an estimated annual state economic impact of $2.1 billion.

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