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Carolinks: The money
By Dan McCue
Staff Writer
One of the most oft-discussed aspects of the Carolinks’ inland development project is the speculation about where the company will get the $250 million to pay for the project.
Lucy Duncan-Scheman, Carolinks’ president and CEO, said to date there have been three rounds of capital development.
“The first thing we did is reach out to individuals that we thought would be interested in seeding the company with a minimum investment of $500,000,” she said. “We particularly reached out to individuals who had local expertise and industry expertise.”
The next round of fundraising was identifying a major corporate partner. To date that corporate partner has not been identified, but Duncan-Scheman said an announcement of the publicly traded company’s identity could come at any time.
“We’re preparing for the announcement as we speak, and when the identity of our partner—a major, major player in the warehousing and distribution industry—is revealed, I think a lot of the naysayers about this project will come around,” she said.
The investment of the corporate partner is so significant, Duncan-Scheman said, that it will cover all of the capital costs of developing Carolinks property at Shipyard Creek as well as at its two proposed inland port sites.
In the past two weeks, Carolinks has been making the rounds in New York, trying to stimulate interest in the project among Wall Street investment firms.
Duncan-Scheman didn’t say how well that effort went, but in a recent interview with Lou Dobbs on CNN, she bemoaned the experience.
“(We) went up there to try to educate Wall Street on the maritime industry…and it’s been shocking to me,” she said. “They’re still looking overseas for opportunities. This opportunity should actually come back home.”
Carolinks does need some help in the area of public works, although even in this regard she said the company has tried to “piggyback on current projects as much as possible.”
As an example, she pointed to the long planned $40 million interchange at Interstate 95 and U.S. 301 in Orangeburg, which will benefit Carolinks due to its location, but will likely be paid for with state and federal money.
But the Carolinks vision does not end at I-95. Duncan-Scheman revealed she’s been working closely with Hal Johnson of the South Carolina Upstate Alliance, a regional development organization, to develop a second Carolinks inland port in the Greenville area.
To make it feasible to create that hub and the inland port and the Shipyard Creek transfer site, Duncan-Scheman needs the state to do extensive work replacing aging tracks and installing adequate signaling along the route her cargo will travel over, she said.
Wilber Smith Associates, an infrastructure design firm, has estimated that the cost of replacing existing tracks alone would be about $1.2 million per mile.
However, this number can vary depending on the condition of the track, said Tom White, spokesman for the Association of American Railroads.
White said the cost to lay down brand new track, starting a line from scratch, ranges between $1 million and $3 million a mile.
“Now, while that might seem expensive, it’s not at all when you compare it to the cost of a new road,” he said. “You can’t get much of anything for $1 million a mile in highways right now.”
Carolinks would also ask state and local officials to widen Pittsburgh Avenue in Charleston so it will better serve as a truck route to the company’s facility, Duncan-Scheman said.
Next she said she anticipates seeking some state or SPA assistance to pay for the creation of a pier at the end of the Wando Welch Terminal dedicated to the loading of Carolinks’ barges.
“We’d also like the ports authority to move two cranes that they already own and have at Wando Welch to the pier for the barges,” she said.
But Duncan-Scheman doesn’t see these things as direct subsidies of Carolinks. “All of these things are really going to benefit the port and its customers and, by extension, the entire region.”
Where Duncan-Scheman does see the state providing direct Carolinks-focused assistance is in funding job-training programs for its future workers.
“But again, I think a program like that has implications that extend far beyond Carolinks,” she said. “I think the owners of potential distribution centers and assembly plants at these sites will see the state creating a program through which companies can vet and train their employees as a big cost savings and as something they’ll want to take advantage of.”
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