TAMPA — Port Tampa Bay may have finally found a formula that works to grow its long-limited cruise business.
The port is poised to serve 1 million cruise passengers for the first time this year, a sizeable feat considering the height limitations of the Sunshine Skyway Bridge and competition from larger, more active cruise ports better positioned around Florida.
It's making the leap not by bringing in the top-of-the-line megaships, but rather relying on refurbished, smaller ships, a growing population and easy-to-reach destinations.
In 2016, Port Tampa Bay handled 813,800 passengers. For the first quarter of the 2017 fiscal year — which falls in line with the busy winter cruise season — the port welcomed 239,301 passengers, a 3 percent increase over 2016. More ships will set sail out of Tampa Bay this year, too — the number of cruise liners have grown from five seasonal and year-round ships to seven this year, including the addition of the Royal Caribbean Empress of the Seas, which will be among the first to sail to Havana, Cuba, beginning in April.
"We've been projecting for years that we'd see a short-term ramp up in cruise business, and that's what we're seeing now," said Edward Miyagishima, vice president of communications and external affairs at Port Tampa Bay. "But the cruise business is a big part of what we do here, and it will play a major role in what we do going forward."
Port Tampa Bay officials are hopeful the local cruise industry will continue to build on this renewed momentum. Tampa Bay is limited in what kind of cruise ships can dock here because of the height of the Sunshine Skyway bridge, which isn't tall enough to accommodate some of the biggest cruise ships that sail regularly from Fort Lauderdale or Miami. But smaller ships are better for Tampa Bay anyway, analysts and local officials agree.
The plan isn't to try to compete with the mega ships and bigger ports, said Wade Elliott, vice president of marketing and business development at Port Tampa Bay, it's to create a niche market in Tampa Bay.
"A lot of the new demand we're seeing for cruise traffic is connected to the population growth in Florida and the I-4 corridor," Elliott said, noting that the majority of Port Tampa Bay's cruise traffic come from Floridians and other "drive-in" markets like Alabama, South Carolina and Georgia. "Now that we've added new ships that serve some new destinations, the goal will be to make those seasonal itineraries year-round."
Port officials want to spend $1.8 million to renovate Terminal 6, a cruise terminal to accommodate the influx of more ships. The port's board of directors are expected to discuss it at the next meeting. The renovation also serves as part of the port's Vision 2030 master plan, which aims to create parks and walkable waterfront areas in Channelside in line with Strategic Property Partners' ambitious plans to transform 50 acres of downtown Tampa.
"This will help us be able to accommodate that new demand and more vessels," Elliott said.
The master plan forecasts a robust growth period ahead for Tampa's cruise business, with annual revenues from passengers potentially nearing $1.4 million by 2030 compared to about $900,00 recorded in 2015. The forecast considered the limitations of the Sunshine Skyway Bridge.
"Tampa has two things going for it. One is that the majority of cruise ports in America are in Florida, and there are only so many ports, so there's leverage there," said Cindy D'Aoust, president and CEO of the Cruise Lines International Association. Second, "the Caribbean is the king of all cruise destinations, which is where Tampa serves. As cruise liners refurbish older ships, they're always looking for new markets to redeploy them."
The "new" ships that are joining Port Tampa Bay aren't brand new and they aren't large. However, each of them went through recent multi-million dollar refurbishments and offer a slew of new amenities. Holland America's MS Oosterdam was renovated as part of a $300 million brand enhancement initiative. The ship has new lounging, dining and entertainment venues and refreshed suites. The 82,000-ton MS Oosterdam replaces the smaller ship MS Ryndam, which had cruised from Tampa for several years.
The Carnival Pride returned to Tampa Bay this month after nearly three years. It sailed out of Baltimore last year. This ship has also been upgraded with new amenities.
The Royal Caribbean Empress of the Seas, too, was recently renovated. It will join two other Royal Caribbean ships in Tampa, the Brilliance of the Seas and Rhapsody of the Seas, when it arrives in April.
"Where Tampa falls short at times is that the amount of ships we have here is based on seasonality," said Julio Soto, director of group product operations and sales for The Auto Group in Tampa. He noted that more than 60 percent of his company's group travel bookings are for cruises. "In the winter, we're fully booked. In the summer the ships leave because of hurricanes, and it cuts the amount of options in half. Year-round cruising at that same volume would be tremendous for Tampa Bay."
Soto said that travelers are lured to Tampa Bay over other cruise destinations because they don't want to be one of 5,000 people aboard one ship. Cruises that sail from Tampa are smaller and more personal, and they're not so crowded.
Port Tampa Bay hosts cruise ships mostly from November through April. Carnival, Royal Caribbean and Holland America originate cruises from Tampa. Those ships hold around 1,000 to 2,600 passengers at a time, and sail mostly to destinations in the Western Caribbean such as Key West, Belize, Honduras and Mexico.
"Tampa is easier for people to get to in a lot of ways. It's a good place to increase visibility and awareness of cruises as a vacation in general, and that not all cruises are as expensive as the ones in Miami," said Jaime Katz, a senior equity analyst at Morningstar, Inc.
But the cruise industry, and Port Tampa Bay, still has its challenges ahead. Optimistic forecasts have been dashed before.
In 2014, a Florida Department of Transportation survey predicted that the port would record 1.1 million passengers traveling on 239 cruises that year. That didn't happen. At the time, studies were underway to see how costly it would be to raise the Skyway Bridge. Beyond height problems, Port Tampa Bay also poses a navigating problem for cruise operators, analysts say. It's prone to fog and difficult to maneuver in shallow waters and tight channels.
Improving relations with Cuba could be stunted by the incoming Trump administration, Katz said, and the infrastructure at Cuban ports will take a long time to build up to support several ships.
"That's still a wild card," she said. "And the infrastructure is limited. There are only three ports right now that cruises could logistically visit, and they're not set up to have more than one ship at a time, realistically. That's at least two to three years before they have enough capacity."
Another obstacle: the cruise industry has struggled to reach young generations behind the baby boomers. Carnival cruise ships that sail in Tampa began serving craft beer, including Tampa's Cigar City Brewery, on board. Carnival also debuted its wearable medallion technology earlier this month, which is similar to the wristbands worn at Disney, which allows travelers to order cocktails and open stateroom doors, among other personalized features, from one device.
"There is a cruise for every travel profile now," D'Aoust said, citing theme cruising options like music festivals to adventure-inspired excursions that are aimed at millennials. "For ever budget, every style and every occasion, regardless of the line. And there is a push to make cruise vacations as customizable as possible. I think we'll see that continue to grow."
Contact Justine Griffin at [email protected] or (727) 893-8467. Follow @SunBizGriffin.