Milwaukee Faces Cruise Ship Arms Race

Milwaukee finds itself in the middle of an unusual arms race: which Great Lakes port can build the best cruise ship dock?

Port Milwaukee, the city-owned agency led by Adam Tindall-Schlicht, has used existing docks to land initial commitments for highly-coveted cruise ship turnaround service. Turnarounds, which include the end of one trip and the start of another, double the number of passengers, generate hotel stays and provide ancillary revenue from the sale of supplies to the vessels.

As a result of the city’s marketing success, Milwaukee has gone from approximately 1,000 annual passengers when Tindall-Schlicht started in 2018 to more than 10,000 this year.

“The cruise market on the Great Lakes is a new and burgeoning industry,” said port marketing director Jazmine Jurkiewicz to the Public Works Committee on Sept. 8. “It is very much a boutique experience for the discerning traveler.”

It’s new enough that ports are now rushing to catch up with larger vessels entering the market. Milwaukee is using the city’s industrial Heavy Lift Dock for the new Viking Cruises Octantis ship, a 666-foot-long vessel that can accommodate 378 guests and 250 crew members. The Seaway-max-sized vessel is the largest capable of entering the Great Lakes and a twin ship is expected to enter the market next year.

Port Milwaukee is pursuing a $7.2 million project to build the South Shore Cruise Dock, a new facility capable of receiving the Octantis and other large vessels at the southern end of S. Carferry Dr. But its cost could grow to include dedicated electrical, water and sewer lines as well as improved dredging and baggage handling.

Milwaukee isn’t the only city moving to dominate the cruise business at the west end of the Great Lakes.

“What keeps me up at night is if we don’t build South Shore correctly, Duluth is building a fantastic dock that will include all of these features,” said Tindall-Schlicht at an Aug. 11 Board of Harbor Commissioners meeting. “Chicago coming online at Navy Pier keeps me up. Duluth and their investment in their downtown dock keeps me up.”

The harbor commission approved allocating approximately $80,000 in additional funding for Collins Engineers, Inc. to expand its dock design effort.

Tindall-Schlicht said the initial design, which got underway in February 2021, was for the “bare minimum.” But the city is learning from its experience serving the Octantis, which currently involves stringing thousands of feet of hoses, cables and other infrastructure to the vessel. He called the expanded request a “Shangri-La” proposal, though the elements proposed include basic infrastructure like built-in sewer pipes.

“These are all elements that we are indeed seeing in real-time that Viking is paying us to provide for them,” said Tindall-Schlicht. He said Viking would work with Collins to help identify the best configuration.

Other ports, said Tindall-Schlicht, are moving to add these features which could result in Viking and others selecting them for turnaround service. Chicago currently uses a dock on its far south side, near the Indiana border, but could explore using Navy Pier as leases begin to expire in 2024.

Port Milwaukee has a 20-year commitment from the smaller Pearl Seas to lease the Pier Wisconsin dock next to Discovery World, but its agreement with Viking is short-term. “Once we move forward with the dock we have the leverage to negotiate that 20-year commitment,” said Tindall-Schlicht.

“There might not be tough competition today, but there will be in the future,” said harbor commission chair Timothy Hoelter in summarizing the situation.

Pier Wisconsin already includes the “Shangri-La” features like built-in utility infrastructure. It’s also closer to Downtown. Why not expand it or find another closer to the heart of the city? It’s a question Alderman Robert Bauman asked last week when the Public Works Committee reviewed part of the new dock’s financing.

“The key here is the federal navigation channel,” said Tindall-Schlicht. Pier Wisconsin works for smaller cruise ships, but not Seaway-max vessels. Port staff said it would cost millions more to complete just the necessary dredging to expand the water depth at Pier Wisconsin by more than five feet. Going upriver isn’t an option because the large ships can’t make the necessary turns. “For us to expand Pier Wisconsin would be triple, four times the cost.”

The city is getting some help in its quest to build the new dock. The state is providing $3.5 million. Governor Tony Evers announced the award, from the state’s American Rescue Plan Act grant, at a February press conference. The Public Works Committee meeting was to formally accept the money.

“This really is the one-time investment that we need,” said Tindall-Schlicht at the event. He said the dock would last 50 years with regular maintenance.

The project is also backed by a $500,000 Harbor Assistance Program grant from 2021 that is administered by the state but relies on federal funding.

Tindall-Schlicht said the dock, once planned to be completed in 2023, would open in 2024 at the earliest. In August he told Urban Milwaukee that Port Milwaukee hoped to identify the remaining funding sources, at least $2 million, by December when construction bidding could begin.

Port Milwaukee had once considered developing the new cruise ship dock alongside Komatsu Mining‘s South Harbor Campus development, but the port director said in February a closer evaluation revealed it was cheaper to develop it on the outer harbor. Funding from the city land sale that enabled that campus to move forward is anticipated to be one of the project’s funding sources.

The cruise ship dock is being built atop a 50-acre landfill created in 1975 as part of an environmental cleanup effort. A portion of the facility is already leased to the Lake Express ferry for its dock and offices. The northern 30 acres will be part of a new cleanup effort starting in 2023 and a new facility will be constructed to the north.

The question of what to do with the five acres of land next to the new dock still remains. The city solicited partners through a request for information in late 2021, but Tindall-Schlicht said there was only a single respondent. He hopes the return of cruise ship traffic this year after a pandemic-related shutdown will draw more interest when the RFI is reissued.

The port is expected to generate $150,000 in direct revenue from the 33 cruise ship visits in 2022, and the Milwaukee area to gain a $2.25 million regional economic impact, according to port officials. In addition to Viking and Pearl Seas, vessels from American Queen Voyages (the former Victory Cruise Lines), Ponant Explorers and Vantage have visited Milwaukee.

Milwaukee will become the cruise ship capital of the Great Lakes on Sept. 24 and 25. For the second time this year, three ships will call on the city’s port on the same weekend.

Great Lakes cruise operators, owing to the 1886 Passenger Vessel Services Act and the reliance on foreign-made vessels, transport passengers on one-way trips between American and Canadian ports. Only American-made vessels can transport passengers between U.S. ports, though the ships can stop in consecutive U.S. ports provided all passengers return to the vessel.

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