    [From the U.S. Government Printing Office, www.gpo.gov]

                PIERS 38/40 REmUSE PLAN

                                     "low

                                       December 1995',

                                             Prepared for:
                                  Philadelphia Regional Port Authority
                                     210 West Washington Square
                                   Philadelphia, Pennsylvania 19106

                          Prepared by:                          In Association with:
                  MOFFATT & NICHOL ENGINEERS                        Martin Associates
                    1629 Thames Street, Suite 400              Orth-Rodgers & Associates
                     Baltimore, Maryland 21231                        HEH&A, Inc.

                       Pennsylvania Coastal Zone Management Program

                                    PIERS 38/40 RE-USE PLAN

                                       DECEMBER 31,1995

                               DEP GRANT/CONTRACT NO. 94.02PS

             A REPORT OF THE PENNSYLVANIA DEPARTMENT OF ENVIRONMENTAL PROTECTION TO
             THE NATIONAL OCEANIC AND ATMOSPHERIC ADMINISTRATION PURSUANT TO NOAA
                                     AWARD NO. NA470ZO248

             Project was financed in part through a federal Coastal Zone Management Grant from the
                                                                  Al

             Pennsylvania Department of Environmental Protection, with fimds provided by NOAA. The views
             expressed herein are those of the author(s) and do not necessarily reflect the views of NOAA or any
             of its subagencies.

                                                                   Table of Contents

                    Introduction       ..................................................................................................i

                    I.        Existing Conditions
                              I .      Background Information          ............................................................. 1-1
                              2.       Facilities Inventory     ...................................................................... 1-2
                              3.       Conclusions and Recommendations              ............................................. 1-8
                              4.       Summary of Required Remediation for Code Compliance                     ............ 1-6

                    II.       Market Analysis
                              I .      Imported Paper      ........................................................................... .11-2
                              2.       Cocoa Beans       ............................................................................... 11-4
                              3.       Imported Brazilian Pulp        ............................................................... 11-9
                              4.       Export Pulp      ................................................................................. 11-9
                              5.       Imported Rubber        ......................................................................... 11-10
                              6.       Metals Exchange        ......................................................................... 11-11
                              7.       Container Freight Station        ............................................................. 11-12
                              8.       Cruise Passenger Market          .............................................................. 11-12
                              9.       Summary of Market Potential and Economic Impacts                   ................... 11-19

                    111.      Traffic Analysis
                              I .      Description of Existing Area Road Network               ................................ 111-1
                              1.1      Existing Traffic Volumes         ............................................................. 111-5
                              1.2      Existing Levels of Services        .......................................................... 111-6
                              1.3      Existing Traffic Generated by Piers 38/40            .................................... 111-6
                              2.       Traffic Impact of Wood Pulp Scenario             ......................................... 111-8
                              3.       Traffic Impact of Passenger Cruise Ship Terminal Scenario                ........... 111-8
                              3.1      Trip Generation of Cruise Ship Terminal             ...................................... 111-8
                              3.2      Parking for Cruise Ship Terminal          ............................................  .... 111-9
                              3.3      Internal Vehicle Circulation at Cruise Ship Terminal             .................... 111-11
                              4.       Traffic Impact of Cocoa Bean Scenario             ....................................... III- I I

                    IV.       Conceptual Design for Market Re-Use
                              1.       Cocoa Bean Facility       ..................................................... ............... IV- I
                              2.       Pulp Paper Facility      ....................................................................... IV-3
                              2.1      Pulp Paper Facility      ..................................................................... IV-3
                              2.2      Cruise Ship Terminal        ................................................................... IV-3
                              2.3      London Metals Exchange            ............................................................ IV-4
                              3.       Cost Estimates       ............................................................................ IV-4

                    V.        Financial Implications       .............................................................................. V-1

                                                             INTRODUCTION

                   The Piers 38/40 complex is currently leased to Penn Warehousing and Distributing, Inc. and used as
                   a warehouse for imported paper from Europe, as well as for paper imported via ship from Canada
                   and for some domestic paper. The imported paper from Europe is received at Pier 80 and then
                   trucked to Piers 38/40 for storage. The paper is used locally, as well as distributed throughout the
                   eastern and Midwestern United States, both by truck and rail.

                   The Philadelphia Regional Port Authority is currently considering the construction of a new paper
                   warehouse located adjacent to the current paper facilities at Piers 78/80 and 80A.     'The new facility
                   under consideration consists of 139,000 sq.ft., which will provide a yearly capacity of about 425,000
                   tons per year.

                   With the construction of this new proposed facility, it will no longer be necessary to use Piers 38/40
                   for warehousing, and, as a result, it is necessary to identify alternative uses for Piers 38/40. It is the
                   purpose of this analysis to identify new opportunities for this facility, and to further develop the
                   required capital improvements and modifications to Piers 38/40 to accommodate the identified market
                   opportunities. The consulting team of Moffatt & Nichol Engineers, Martin Associates, Orth-Rogers
                   Associates, and Harold E. Hall & Associates was retained by the Philadelphia Regional Port
                   Authority to evaluate the potential uses of Piers 38 and 40, and to develop conceptual designs and
                   associated capital costs for each alternative.

                   In the balance of this report, the existing conditions of the Piers are first evaluated. Next, the
                   potential re-use opportunities are identified and evaluated. Potential traffic impacts on Columbus
                   Boulevard are then addressed. For each opportunity identified, conceptual designs are developed
                   along with associated costs. Finally, the financial implications of the re-use opportunities are
                   presented.

                                                     1. EXISTING CONDITIONS

                   1.      Background Information

                   Piers 38 and 40 originally consisted of two timber pile supported reinforced concrete deck pier
                   structures constructed circa 1912. The apron along the pierhead consisted of a timber pile supported
                   timber deck with earthen fill above it and concrete perimeter retaining walls. In 1956, a timber
                   supported apron was constructed on the upriver face of Pier 38 and the downriver face of Pier 40 and
                   the area between the piers was filled with a timber supported platform. The 1956 construction
                   consists of timber pile supported timber decking which supports earthen fill, and is topped by a
                   concrete deck. There are perimeter concrete retaining walls to retain the fill. The perimeter wharf
                   apron elevation is approximately + 12.75 along the face of the warehouse structures and +11. 7 5 along
                   the face of the pier. The elevation of the area between the piers is approximately +9.00. This area
                   is referred to as the open pier. The open pier is 3'-9" below the elevation of the loading dock which
                   extends along the length of both building structures on the pier. The elevated portion of the open pier
                   extends inland approximately 85 feet from the face of the wharf apron and its interior limit follows
                   the pierhead fine. There is a 40 foot long ramp to gain access from the higher elevation of the apron
                   to the lower elevation of the open pier.

                   The buildings on the piers were originally constructed circa 1912. They are both two level steel
                   framed buildings with concrete encased steel end walls. The footprint of each building is 170� feet
                   by 525� feet with the waterside face of the building extending an additional 34 � feet to the east,
                   along the pierhead line. The first floor has a clear height of approximately 22 feet and the second
                   floor has a clear height of approximately 15 feet. Each building has four structural bays across the
                   width which are 42 feetAride in the interior bays and 43 feet wide in the exterior bays. There are 26
                   standard longitudinal bays, 20 feet long, with some special bays along the pierhead end of the
                   building. The north and south elevations were originally steel veneer with roll-up doors. Cargo hoist

                  steel framing along the north and south facades projects 25 feet above the roof line. The east and
                  west elevations have decorative concrete facades which extend approximately 45 feet back along the
                  side elevations. The west elevations are on the street side of the buildings and have arched entrances
                  originally designed for train, vehicular and human access into the building. These entrances were
                  equipped with roll-up doors or man doors, as required. The track pit was located along the centerline
                  of the building with vehicular ramps on either side of the tracks. The first floor was paved with a
                  vitrified block floor. The second floor and roof deck are of concrete construction. The buildings
                  were equipped with 4 platform elevators and 2 package elevators in addition to several stairs. The
                  original construction documents do not indicate any heating or cooling systems for the buildings.
                  There are some ventilation features designed into the window areas of the building walls. The roof
                  was equipped with a series of skylights and the second floor had light wells which corresponded to
                  the center skylight locations. There are a series of hatches in the second floor as well. Exhibits 1-1
                  and 1-2 provide a plan and cross section of the existing structures.

                  2.      Facilities Inventory

                  A physical evaluation of building facilities was conducted for the Philadelphia Regional Port Authority
                  (PRPA) in 1994 by O'Donnell & Naccarato, Inc. (O&N) which included the warehouse structures
                  on Piers 38 and 40. O&N perforined a detailed review of each building with respect to architectural,
                  structural, mechanical, plumbing and electrical systems and prepared budget estimates of the cost to
                  upgrade the condition of these facilities for safe conditions meeting building code. The general
                  overview of the buildings prepared by O&N, and verified by a cursory inspection performed by
                  Moffatt & Nichol Engineers (M&N), indicates that the buildings are in disrepair and show evidence
                  of neglect. The roofs are in poor condition, with soft areas, blistering and cracks in the roofing
                  membrane. The exterior doors and windows are broken and/or repaired in an inconsistent manner
                  allowing for leakage. The paint on the exterior steel and cargo masts has a poor appearance. The
                  surrounding paved areas, sidewalks, loading docks and curbs are in disrepair and the concrete is
                  spalling. The interior steel is in need of painting and cleaning. The stair towers are not enclosed and
                  the toilet facilities are in disrepair. Interior doors and hardware are also in poor condition. The

                                                                 1-2

                                                                              DELAWARE AVENUE

                                                                                                       RAILROAD
                                                                                       BULKHEAD LINE TRACK (TYP.)
                                                             ........................
                                                                                                      ---------------------------       ......

                                                                   PIER 40
                                                                WAREHOUSE           OPEN PIER
                                                                                                        PIER 38      p    BOLLARD (TYP.)
                                                                                                      VVAREHoUSE
                                        C14                                         620,
                                  A

                                                                                                                           AREA WITH ROTTEN AND
        F4                                                                                                                 MISSING DECKING

                                                                                                                     AREA WITH DAMAGED PILES AND
                                                                                                                          MISALIGNED SEAWALL
                                                                                                             . . ...........................

                                  PIERHEAD LINE
                                                  V                          MARGINAL WHARF

                                                                            DELAWARE RIVER

                                                                                   PLAN
                                                                                   N.TS.
                                                                                                                             EXISTING CONDITIONS
                                                                                                                           PIERS 38-40 REUSE PLAN
                                                                                                                  PHILADELPHIA REGIONAL PORT AUTHORITY
                                                                                                                  DECEMBER1995                      EXHIBIT 1-1

                            SOUTH APRON                        PIER 40                       OPEN PIER                   PIER 38                NORTH APRON

            CONC. RETAINING
            WALL (TYP.)                              CONC. RETAINING
                                                     WALL (TYP.)
                                                                                          EL.+4.41                                                           EL.+3.
                                                                               lo@            E +0.41                                                                0   TIMBER
                                  FILL                                             FIL@                     <FILL                     cl,        *-FILL
                                                                                                            <
                                                                                                  FILLN,          00                                                     PILE
                  C' 0     TIMBER DECKING (TYP.                                                                   0                                                      CAP
            M.L.W.                                                                                                                                                       (TYP.)
            EL.-7.6'
                                                                    illi III MIT

            TIMBER
            PILE _                                                                                                                                                        TIMBER
            CLAMP                                                                                                                                                         FASCIA
            (TYP.)                                                                                                                                                        PLANK
                                                                                                                                                                          (TYP.)
                                                                                               TIMBER
                                                                                               PILE
                                                                                               (TYR)

             MUD
             LINE

                                                                                       SECTION A-A
                                                                                           N.TS.
                                                                                          _@E
                                                                                         .0@
                                                                                         c.
                                                                                         0

                                                                                                                                          EXISTING CONDITIONS
                                                                                                                                         PIERS 38-40 REUSE PLAN
                                                                                                                              PHILADELPHIA REGIONAL PORT AUTHORITY

                                                                                                                              DECEMBER 1995                         EXHIBIT 1-2

                  overaH structural integrity of the buildings appears to be generally sound, except for the east and west
                  concrete end walls, which are cracked. The mechanical, electrical and plumbing systems are generally
                  in poor condition. The warehouse spaces are neither heated or cooled and do not have ventilation
                  systems. The buildings have City certified sprinkler systems. The buildings are not in compliance
                  with the Americans with Disabilities Act (ADA).

                  Specific architectural and code related problems were delineated by O&N and are restated below.
                  Furthermore, they noted that because of the location of the two piers adjacent to Penn's Landing and
                  the planned River Walk, the buildings' exterior appearance should be upgraded.

                  Pier 38. Deficiencies specific to Pier 38 include cracked and spalling exterior and interior concrete
                  slabs, uneven wooden block floors, cracked and spalled concrete soffits, and a poor electrical power
                  distribution system.

                  Pier 40. The general condition of Pier 40 is very similar to Pier 38 as described above. In addition
                  to the deficiencies described above, the toilet facilities are in poor condition.

                  Open Pier. The paved area between the two piers is spalled and cracked. The condition of the timber
                  decking below the paved area is described in the "South Wharves on the Delaware River" prepared
                  by S. T. Hudson Engineers, Inc. (STH) dated August 23, 1994. This pier survey report indicates that
                  the timber low deck area between the two piers has " localized areas of rotted deck timber and the
                  diver observed fill washing out of the openings" left from the loss of deteriorated timber decking
                  "concentrated between Stations 3+00 and 3+50 and from 100'to 150" inshore from the face". The

                  survey goes on to state that "typically, the condition of the deck timbers within this area show signs
                  of moderate rot. Deck timbers were probed one to two inches in depth."

                  The timber decking of the open pier consists of 6"x 12" decking. Probes of one to two inches indicate
                  a sectional loss greater than 20 %, which is standard for determining that the timber has lost its
                  structural integrity. M&N considers the condition of the decking in the specific area as described in

                                                                  1-5

                  the STH report, to be poor. In Section III - Conclusions and Recommendations, of the STH report,
                  the condition of "the remaining areas of decking were found to be in good condition." Without
                  further investigation, however, there is no way to determine the extent of deterioration beyond the
                  area of investigation which was inspected "up to 175 feet inshore from the outshore face" of the pier.
                  This report is to determine the feasibility of reusing the existing facilities for another maritime
                  purpose. Therefore, for the purposes of estimating costs to repair the open pier decking, it will be
                  assumed that the extent of the timber decking requiring replacement is limited to the 100 foot square
                  area described in the STH report as losing fill. The STH report indicates that the decking along the
                  wharfs is in good condition.

                  It is strongly recommended to have an additional underwater condition survey conducted to
                  determine the limits of the rotten and deteriorated decking more thoroughly and to extend farther
                  inland than the survey conducted by STH. As stated earlier, probes of one to two inches into the
                  decking indicate that there is a loss of the structural integrity of the timber decking below the open
                  pier. Based on the information provided in the STH report regarding the conditions of the existing
                  open pier substructure, consideration should be given to severely restricting any live load on the open
                  pier structure in the area above where the deficiencies have been described by STH, until such time
                  that the entire substructure is further investigated, analyzed and subsequently rated for capacity. It
                  would also be prudent to limit the allowable live loads on the areas adjacent to those where
                  deteriorated or missing decking has been found, to reduce stresses on members adjacent to those that

                  are deteriorated.

                  Seawall. The concrete seawall along the southern face of the open pier was reported to be " in fair
                  to good condition" in the STH report, with one area "between Stations 2+73 and 3+34 ... in poor
                  condition". The STH survey indicates that there are 34 timber bearing piles along the perimeter of
                  the low deck platform which are broken, missing or split. Of these, 31 are in the first (most exterior)
                  row and 3 are in the second row. A concentration of these piles is found in the area between Stations
                  2+73 and 3+34 and "it is obvious that the misalignment and deflection of the seawall .. is attributable
                  to the concentration of first and second row bearing piles which are either broken or missing in this

                                                                 1-6

                   area." It should be noted that the piles are spaced at approximately 5 foot intervals under the entire
                   structure, so the number of broken piles represents a small percentage of the total amount of piles.
                   The survey states that "it is imperative that underpinning of this section of the structure be effected
                   as promptly as possible in order to deter any further vertical deflection. Continued settlement of the
                   wall could result in a partial collapse at this location." The STH report indicates that the remainder
                   of the piles are in good condition, however, there is no indication of the depth of probe penetration
                   into these piles. Probe penetrations of the existing piles will be necessary to determine the remaining
                   pile integrity. This is an important factor for pile capacity analysis to determine future allowable loads
                   which must be incorporated into the final design of any reuse plan. In the meantime, it is strongly
                   recommended to severely limit or restrict the allowable live loads on the pier in the areas above and
                   adjacent to the broken and missing piles until the piles are replaced.

                   Concrete Substructure. The other significant condition reported by STH is that "the underside of the
                   reinforced concrete high deck slab was observed from the low water elevations. The underneath of
                   the deck beams are severely spalled with exposed reinforcing steel." In Section III of the STH report
                   it is stated that "the reinforced concrete high deck is in good condition with localized areas of spalled
                   concrete and exposed rusted reinforcing steel bars along the under side of the deck. We conclude
                   that no repairs are required at this time. We do, however, recommend future surveys (every two to
                   four years) to monitor the condition of spalled areas." This condition indicates that there is loss of
                   the structural integrity of the high deck structure. The observation does not indicate the extent or
                   the exact location of the deficiency. Even though it is reasonable to expect that if a specific condition
                   is observed in one area of existing construction that the same condition would be observed elsewhere,
                   provided the construction is of the same age and type, repair recommendations cannot be made
                   without further investigation or clarification. It is not obvious from the divers report whether the
                   wharf area only or the high deck under the buildings was observed. In either case, further
                   investigation is strongly recommended and, more importantly, loading restrictions should be
                   considered for the specific area where deteriorated conditions were observed. Further investigation
                   into the substructure of both the wharf area and the building floors is strongly recommended. Based
                   on the information provided in the STH report regarding the conditions of the existing structure,

                                                                    1-7

                   M&N recommends that consideration be given to limiting the live load on the structures until such
                   time that they are further investigated, analyzed and subsequently rated for capacity because of the
                   potential for structural failure. It is also recommended that, until such time that these investigations
                   can be performed, the facilities be monitored to look for any evidence of subsidence or open cracks
                   in the paving, floor slabs or other members which might indicate pending failure of the structure.

                   3. Conclusions and Recommendations

                   M&N has reviewed the pier survey report by STH. The report indicates specific areas with structural
                   deficiencies in the timber decking supporting the open pier structure as well as the reinforced concrete
                   high deck. These areas are deficient and should be restricted until repairs are implemented. The
                   report indicates that "the remaining areas of decking were found to be in good condition," but the
                   entire timber decking area was not inspected. With respect to the reinforced concrete high deck, STH
                   concludes "that no repairs are required at this time", however they recommend monitoring "the
                   condition of the spalled areas". M&N's experience has been that if there is a problem or deficiency
                   in one area, there are often problems in adjoining areas. Since we have neither inspected or evaluated
                   the structures in their current condition, we cannot render an opinion as to their condition or capacity.
                   Therefore we cannot recommend that conclusions other than those formulated in the STH report be
                   taken into consideration. We do, however, urge caution in continued unrestricted use of the facility
                   until an investigation is performed. From this investigation, analyses and recommendations can be
                   made as to the remedial work required; until such time this work is performed, it would be prudent

                   to follow the recommendations of STH.

                   A new fender system should be installed to protect from future damage to the perimeter piles along
                   the marginal wharf. Based on the probable future use, a proper fender system can be designed. It
                   is recommended to use a system which utilizes fender panels which are sized based on the hull
                   pressure of the ships using the wharf. The fender panels could be spaced at approximately 40 foot
                   intervals to accommodate the range of vessels expected to use the marginal wharf and would act to
                   protect the central portion of a cargo ship from damaging the piles at low water situations. A

                                                                   1-8

                  complete analysis of the structural capacity of the new and/or existing timber piles will be necessary
                  as part of the fender design. For the purposes of this report, the lateral capacity of the pier was
                  determined assummg the pier has its original capacity. This very optimistic approach resulted in the
                  design of 30 foot square fender panels at 40 foot intervals along the central portion of the marginal
                  wharf. This was used as the basis for the construction cost estimate for a new fender system.

                  The cracked concrete exterior paving appears to be only superficial in nature and should be repaired
                  if it presents a safety hazard or is required by the future user as part of his operation. In the areas
                  where rotten timber decking has been found, the concrete paving will have to be replaced during the
                  construction required to replace the timber decking areas beneath it.

                  4.      Summary of Required Remediation for Code Compliance

                  The building deficiencies include mechanical, electrical, life safety, access and emergency systems and
                  must be addressed to comply with current codes and standards. Therefore, the cost estimates
                  associated with each re-use scenario will include repairs to the substructure and upgrade of the
                  buildings to meet current building code and standards. It is assumed that the sprinkler system is still
                  to City standards but should be replaced as directed by the O&N report. The cost estimates provided
                  in the O&N report will be utilized to provide the costs to bring the buildings up to code. M&N has
                  prepared an estimate for repairs to the open pier, piles and substructure with the exception of the
                  remaining timber decking and the concrete substructure under the buildings for which there is no
                  available information. No estimate can be made for this work without such information, and
                  furthermore it must be stressed that there is a very real possibility that significant structural
                  deficiencies exist below the pier structures that will require repair prior to re-use of the structures for
                  an industrial use. The structural repair estimates will be included in all scenarios as the minimum
                  work required for any re-use plan of the facilities at Piers 38 and 40.

                                                     H. MARKET ANALYSIS

                  In this chapter, potential re-uses of Piers 38/40 are identified based on an assessment of potential
                  breakbulk markets in which the Port of Philadelphia can compete. To identify potential uses of Piers
                  38/40, Martin Associates reviewed Journal of Commerce, "PEERS" data to identify any major
                  breakbulk commodities that were moving to and from shippers/consignees in the Philadelphia
                  hinterland via other ports such as Baltimore, Wilmington (DE), Norfolk/Hampton Roads and New
                  York. Major shippers and consignees handling these breakbulk cargoes were then interviewed to
                  determine port selection criteria.

                  The key market opportunities initially identified are:

                         Imported paper, which is currently handled at the Port of Philadelphia and stored in Piers
                         38/40. Philadelphia has established itself as one of the leading paper import gateways, and
                         an understanding of the outlook for this market is necessary in order to determine if Piers
                         38/40 will be required in the future to handle the paper import trade.

                         Cocoa beans now moving to confectionery manufacturers located in Pennsylvania, Illinois,
                         Wisconsin, and New York. These beans are currently moving through the facilities leased
                         from the Philadelphia Regional Port Authority and the South Jersey Port Corporation's
                         facilities in Camden, as well as through the Virginia Port Authority's facilities in Newport
                         News, Hampton Roads, and Norfolk, and through the Port of New York and the Port of
                         Albany.

                         Brazilian pulp imports moving through the Port of Baltimore and destined for consignees in
                         Wisconsin, Pennsylvania and New Jersey.

                         Export pulp now moving via such ports as Wilmington, NC

                         Imported rubber handled at the Virginia Port Authority for tire producers located throughout
                         the United States.

                         A container freight station (CFS) where consumer goods could be consolidated into container
                         loads to be carried as back-haul cargo on the paper ships delivering paper from Europe and
                         Scandinavia.

                  Two non-commodity market opportunities were also evaluated:

                         The establishment of a portion of the facility as a metals exchange, where metals traded on
                         the London Metals Exchange could be stored.

                         A cruise terminal, which could also be combined with the use of the facility as a cocoa bean
                         and metals exchange facility.

                  In the remainder of this chapter each opportunity is discussed.

                  1.     Imported Paper

                  The Port of Philadelphia has established itself as a premier paper import port, handling more than
                  50% of the paper imported by North Atlantic ports. Other ports handling the paper imports on the
                  North Atlantic are New York, Baltimore, New Haven, and New London. Exhibit Il- I shows that the
                  volume of imported paper handled at Philadelphia fell from 1988 through 1991, and the share of
                  imported paper handled at the Port of Philadelphia fell to about 40%. However, after trade
                  restrictions were lifted on imported paper, tonnage and market share increased substantially through
                  the Port in 1993 and 1994.

                  The majority of the paper now imported through the Port of Philadelphia is controlled by three
                  importers:

                         Madden
                         Kyrnmene
                         Enzo

                  These three importers controlled 85% of the 792, 100 tons of imported paper handled by the port in
                  1994.  Other importers include:

                         Central National Gottesman
                         The Philadelphia Inquirer/Knight Ridder
                         Norske Skog
                         SCA Graphics
                         Feldmuehle
                         Perkins Goodwin
                         R.R. Donnelley
                         Mckeon Paper
                  0      W.W.F. Paper

                  Interviews with each of these importers identified an additional 158,000 tons of paper will likely be
                  handled at the Port in the near term. This increase results from the addition of new capacity by one
                  of the major importers, as well as increased production by another key importer. Also, a third
                  importer, currently not one of the top three, indicated that new tonnage will be moved through the
                  Port of Philadelphia as a result of the diversion of current imports from a Gulf Coast Port to
                  Philadelphia, and the addition of new tonnage to serve a market previously served by a competitor.

                                                                  11-2

                                                   Exhibit Il- I
                                      Paper Imports at the Port of Philadelphia

                        Thousands Of Tons                 Percent
                 1 @600                                            .60%

                 19400   ... .........  ------------
                        -------------  - ..,    -----------        50%
                 1,200   --------      ------- -----------
                                            - -- - ----- --       -40%
                 19000                 .. .. .. ...... ..                         NORTH ATLANTIC TONS
                   800                                             30%            PHILADELPHIA TONS

                                                                                  PHILADELPHIA SHARE
                   600
                                                                   20%
                   400
                                                                   10%
                   200

                       0 In  w    I,,-' M 0   0        IN M V      0%

                                                      11-3

                 In the near term, paper imports are projected to reach 950,000 tons, and assuming a 3% annual
                 growth rate, paper import tonnage at the Port of Philadelphia will likely reach 1. 1 million tons. These
                 forecasts of paper import tonnage are consistent with the 970,000 tons projected by the PRPA in the
                 Physical Plant and Paper Handling Operations Study. Based on the analysis in this O'Donnell &
                 Naccarato report, it would appear that the new paper warehouse planned at the Piers 78A and 80
                 complex will be adequate to handle this future tonnage, and, hence, Piers 38/40 will not be needed
                 given the construction of a new warehouse.

                 2.      Cocoa Beans

                 The Port of Philadelphia has historically been a major import port for cocoa beans, which were
                 consumed by the confectionery manufacturers located within the Commonwealth, particularly in
                 Hershey, Elizabethtown and Lititz, Pennsylvania. Exhibit 11-2, on the following.page, shows the
                 location of the major confectionery manufacturers with respect to the Port of Philadelphia. This
                 exhibit indicates that the Port of Philadelphia represents the closest port for the majority of the
                 confectionery manufacturers.

                 Exhibit 11-3 shows that in the early 1980's, the Port of Philadelphia handled more than 50% of the
                 cocoa beans imported into the United States. This share dropped to about 15% by 1991 and 1992,
                 as the Virginia Port Authority dominated the cocoa bean import market with the availability of on-
                 dock bean storage. This concept of on-dock storage reduced costs of handling and storing the beans
                 significantly, and provided a cost effective alternative to the Port of Philadelphia, which had
                 experienced problems with facilities, as well as labor costs, during the mid to late 1980's. However,
                 through aggressive labor concessions and improved on-dock facilities, the Ports of Philadelphia and
                 Camden are regaining market share. By 1993, the port facilities at Philadelphia and Camden handled
                 about 25% of the beans imported into the United States. The share fell slightly in 1994, as did overall
                 bean import volume.

                 To identify the potential to increase the cocoa bean throughput at Philadelphia and to assess the
                 compatibility of Piers 38/40 for use in the cocoa bean market, Martin Associates interviewed the
                 f
                    llowing importers, brokers and manufacturers:
                 .0      EDF Mann
                         Cargill
                         Chadler, USA
                         Blommer Chocolate
                         Grace Cocoa
                         Hershey Chocolate
                         Nestle's
                         Wilbur Chocolate

                         ' "Study Summaa, Recommendations and Budgets," Physical Plant and Paper Handling
                 Operations Study, for the Philadelphia Regional Port Authority, prepared by O'Donnell &
                 Naccarato.

                                                                   11-4

                                     M&M Mars
                                     Dependable Distribution
                                     CICT
                                     Cocoa Merchant Association

                             Interviews with the local cocoa bean importers in the Philadelphia and Camden area
                    indicated that currently there exists about 1.      3 million sq. ft. of storage:

                                     500,000 sq.ft. at Pier 84 in Philadelphia

                                     300,00 sq.ft. at the Beckett Street Terminal in Camden

                                     500,000 sq.ft. in Pennsauken

                                                                     Exhibit 11-2
                                                     Location of Cocoa Bean Manufacturers

                                              COMPANY                             CITY      DISTANCE FROM PORT
                                                                                               (MILES)
                                   BLOMMER CHOCOLATS                SAN MATEO, CA               2871
                                   GHIRADELLI CHOCOLATE             SAN LEANDRO, CA             2865
                                   GUITTARD CHOCOLATE               BURLINGAME, CA              2880
                                   HERSHEY FOODS                    OAKDALE,CA                  2857
                                   NESTLE                           SALINAS, CA                 2911
                                   GENERAL FOODS                    DOVER,DE                      74
                                   LONRAY                           SAVANNAH,GA                  693
                                   BLOMMER CHOCOLATE                CHICAGO, IL                  742
                                   BRACH                            CHICAGO, IL                  742
                                   LEAF CONFECTIONARY               BANNOCKBURN, IL              742
                                   WORLD'S FINEST CHOCOLATE         CHICAGO, IL                  742
                                   MERKENS CHOCOLATE                MANSFIELD, MA                288
                                   AMBROSIA CHOCOLATE               NEWARK, NJ                    82
                                   BARRY CHOCOLATE                  PENNSAUKEN,NJ                    5
                                   GILL & DUFUS PRODUCTS            GLASSBORO, NJ                 23
                                   VAN LEER CHOCOLATE               JERSEY CITY, NJ               88
                                   COCOA LINE                       BROOKLYN, NY                 106
                                   NESTLE FOOD CORP                 FULTON, NY                   275
                                   CADBURY SCHWEPPS                 TORONTO,OT                   459
                                   HERSHEY FOODS                    SMITH FALLS, ONT             403
                                   BLOMMER CHOCOLATE                E. GREENVILLE, PA             36
                                   HERSHEY FOODS                    HERSHEY,PA                    94
                                   M&M MARS                         ELIZABETHTOWN, PA             81
                                   WILBER CHOCOLATE                 LITITZ, PA                    71
                                   NILSON CHOCOLATE                 MONTREAL, QUE                447
                                   AMBROSIA CHOCOLATE               MILWAUKEE, WI                828
                                   NESTLE                           BURLINGTON, WI               812

                                                                          11-5

                   This represents about 800,000 sq.ft. of on-dock or near dock storage in the Philadelphia
              area. Currently, this capacity is not fully utilized, averaging about 65 % of capacity utilization.
              The ability to use on-dock storage reduces the cost of importing cocoa at Philadelphia by about
              $5 per ton, as drayage from the piers to off-dock warehouses is eliminated.

                                            Exhibit 11-3
                               Cocoa Bean Imports at the Port of Philadelphia

                   THOUSANDS OF TONS                PERCENT
                500                                       60%

                400-

                                                          40%
                300                                                   U.S. TONNAGE

                                                          .30%        PHILADELPHIA TONS

                                                                    -*-PHILADELPHIA SHARE
                200

                                                          .20%

                100
                                                          10%

                   0                                      0%

            SOURCE: COCOA MERCHANT ASSOCIATION

                                              11-6

                  Currently, cocoa beans are imported into the United States in bags of about 140 pounds. The
                  majority of the beans are imported in breakbulk form, while a smaller share of the beans are imported
                  via bolsters or containers. At the marine terminals in Philadelphia and Camden, Pier 84 can only
                  handle breakbulk cargo, since the apron width is not properly configured to handle containers and
                  shoreside cranes. However, containerized cocoa beans can be imported at Packer Avenue and South
                  Jersey Port Corporations's Beckett Street terminals.

                  Based on the interview results, the trend in cocoa bean imports is to deliver the beans in bulk form
                  or in super sacks (bags of one ton) to the manufacturers. The terminals are becoming integrated with
                  the manufactures' logistics systems. For manufacturers that have sufficient silo storage capacity,
                  delivery in bulk form is preferred, while for manufacturers with limited storage capacity, the super
                  sack has become the preferred method over the receipt and storage of cocoa beans in bags of about
                  140 pounds.

                  The preferred method by the importers and manufactures is to source-load containers in bulk, and
                  deliver the bulk containers directly to the manufacturer under a "door to door" intermodal rate.
                  However, this requires very strict quality control measures at the port of loading, and further requires
                  the ability to control the humidity of the beans within the containers while in transit. Neither of these
                  key factors has been perfected to date. In Europe, beans are delivered in bulk containers to
                  customers, after the beans are debagged at the port of discharge.

                  Within the United States, the first degree of bulk bean delivery is the receipt of the bagged beans (140
                  pound bags) at the port, either in breakbulk form or in containers. The beans are debagged at the
                  port, reloaded in bulk trucks or reloaded in super sacks. By reloading the beans in super sacks or
                  food quality-trucks at the port of entry, the manufacturer or importer can accept or reject the beans
                  prior to its arrival at the plant. By using the warehouse and debagging facilities at the port,
                  investments in silos at the manufacturing plants are reduced. However, the debagging and reloading
                  of the beans at the port of entry does add an additional cost that must be offset from a transportation,
                  or value added, perspective. Such value added services at the port of entry that can be used to off-set
                  the extra cost of debagging and then reloading into bulk trucks or super sacks include cleaning the
                  beans, weighing, sampling, and testing the beans by the terminal operator. Most manufacturers in the
                  United States prefer the super sacks over the receipt of beans in containers, since the containers must
                  be stripped and returned to the port or ocean carrier in a timely manner to avoid detention charges.

                  The second generation of bulk deliveries is the source-loading of the beans in bulk into containers.
                  This method of source-loading in bulk containers reduces the costs of debagging and reloading into
                  super sacks at the port of discharge, and also will provide a through transportation cost. However,
                  in addition to the potential loss of quality control at the source-loading port, as well as the inability
                  to control the humidity in-transit, the receipt of bulk beans in containers at the manufactures requires
                  investments in silos. Also, it is not possible to inspect the beans at the port of entry prior to receiving
                  the cocoa beans at the plant.

                  The bean importers identified a third and highest level of value added processes that could develop

                                                                      11-7

                  in the future. This includes cleaning and destoning of the beans at the port, super cleaning the beans
                  to food quality, shelling the beans, storing the nibs and eventually delivering the nibs to the plant. At
                  this third stage of value added processing, the terminal operator and port have become completely
                  integrated into the logistics system of the confectionery manufacturer.

                  In order to position itself as the leading cocoa bean port, it will be necessary for the Port to offer
                  these value added services on-dock, in order to offset drayage costs and minimize the costs of bean
                  imports to compete effectively with source loaded, bulk deliveries at the plant. To this end, Piers
                  38/40, could provide the on-dock capacity for such value added operations. Piers 38/40 used as a
                  cocoa facility would provide the following advantages for the Port of Philadelphia:

                          Transfer beans currently stored off-dock to Piers 38/40. This transference would add a
                          revenue stream to the PRPA, based on storage charges.

                          Direct discharge of vessels at Piers 38/40 can be accomplished, including both breakbulk and
                          containers. Therefore, drayage to off-dock warehouses will be eliminated. Piers 38/40 can
                          be used for warehousing and transit shed operations, and the beans can be trucked to Pier 84
                          for value added processing for designated customers.

                  Interviews with the brokers, importers and terminal operators expressed a preference to use the Port
                  of Philadelphia for bean imports, and this preference would increase with the availability of more on-
                  dock storage and lower labor costs within the warehouse. Three key Pennsylvania manufacturers
                  expressed a strong preference to begin debagging operations and bulk deliveries (either in bulk trucks
                  or super sacks). However, it is critical that the price of the debagging and reloading operations will
                  be more attractive than the source bulk loading,

                  Currently, debagging operations are in place at the Port of Albany, the RPM Terminal in Staten Island
                  and the Continental Terminal in Brooklyn, as well as in Philadelphia.

                  The interviews with the brokers, importers, terminal operators and manufacturers indicated that with
                  increased on-dock storage space in Philadelphia and growth in the debagging operations, an
                  additional 800,000 to I million bags of cocoa beans could be imported via the Port of Philadelphia.
                  The Cocoa Bean Merchants Association projects that Philadelphia could regain a 50% share of the
                  total cocoa bean import market by the year 2000. The majority of this increase will come from the
                  diversion of about 3 million bags of cocoa beans from Norfolk, combined with an annual growth rate
                  of 3%. Combing the estimates of additional cocoa bean throughput from the interview results and
                  the projections developed for Philadelphia by the Cocoa Bean Merchants Association, it is estimated
                  that by the year 2000, and assuming a fUll-scale debagging operation at Pier 84, an additional 860,000
                  bags of cocoa beans could be imported through the facilities in Philadelphia.

                  While the projected levels of cocoa throughput at Philadelphia are not solely dependent upon the use
                  of Piers 38/40 as additional cocoa facifities, these facilities would provide additional on-dock storage.
                  It is to be emphasized that as the beans are debagged and rebagged into super sacks, more warehouse

                                                                     11-8

                  square footage will be required as the super sacks cannot be stacked to the same height as the
                  standard bags of 140 pounds. Furthermore, it is envisioned that only the bottom floors of Piers 38
                  and 40 would be used for bean storage, and the upper levels could be used for other uses such as
                  cruise facilities and a metals exchange.

                  3.      Imported Brazilian Pulp

                  The Port of Baltimore has dominated the imported Brazilian pulp market, handling about 400,000
                  tons of pulp annually. This pulp is, for the most part, railed to plants in Wisconsin for use in the
                  production of paper products such as disposable diapers and feminine hygiene products.

                  To determine potential for the Port of Philadelphia, interviews were held with several of the key
                  players in the pulp import market, including the importer Rio Doce, Balterm (the terminal handling
                  the pulp in Baltimore), and Star Shipping (the specialized forest products carrier transporting the
                  Brazilian pulp). These interviews indicated that between 1995 and 1997, 550,000 additional tons of
                  pulp will be imported into the U.S., based on current production expansion plans in Brazil. Several
                  ports are under consideration to handle this tonnage:

                          Philadelphia
                          Baltimore
                          Houston
                          Mobile
                          New York

                  Key in the Port selection criteria is the need for direct rail access by more than one rail line into the
                  terminal, and a warehouse sufficient to handle the tonnage. Further interviews with the importer and
                  ocean carrier indicated that Philadelphia could potentially handle about 200,000 tons of this pulp,
                  particularly due to the rail access into the Port by Conrail, CSX and the CP Railway. However,
                  interviews with the importer also indicated that improvements in the physical condition of the
                  warehouses would be required.

                  The potential for the Port is estimated at about 200,000 tons annually, and annual growth is projected
                  at 10% for the next 5 years. Piers 38/40 are served by all three rail lines, and could potentially be
                  used to accommodate this breakbulk pulp market.

                  4.      Export Pulp

                  The market for export pulp was identified as a market for further exploration by the PRPA. Martin
                  Associates identified key mills supplying the export market. These mills included:

                          James River Corp.
                          Kimberly Clark
                          Kruger International

                                                                    11-9

                         Union Camp
                         Alpha Cellulose
                         International Paper
                         Federal Paper
                         Georgia Pacific
                         Buckeye Cellulose (formerly Proctor and Gamble)
                         Weyerheauser

                  Interviews were conducted with each mill to determine the potential for export via Philadelphia. For
                  the most part, ports serving the export pulp market are located within less than 150 miles of the
                  producing mills. The majority of the mills supplying the export market are located in the
                  Southeastern U.S., and use ports such as Wilmington, NC for ports of export. The ports typically
                  are integrated into the logistics system of the mills, and offer on-dock storage. for the unitized
                  breakbulk pulp.

                  One producer indicated that there might be limited market potential for Philadelphia to handle about
                  500 TEU's annually of pulp bound for the Australia/New Zealand Market. This could move as a
                  backhaul on current carriers calling the Port. The specific mills supplying this market are located in:

                         Erie, PA
                         Lockhaven, PA
                         Hamilton, Ohio
                         Westfield, MA.
                         Androscoggin, ME

                  The market potential does not appear to be compatible with Piers 38/40, since the moves are
                  containerized and would be backhaul cargo for carriers calling other marine terminals at the Port.

                  5.     Imported Rubber

                  New Orleans and Norfolk are the major ports used to handle imported breakbulk rubber. Recently,
                  Waterman Steamship added the Port of Morehead City as a port for rubber imports, primarily for
                  rubber imported by Goodyear. To determine if the Port of Philadelphia could enter the breakbulk
                  rubber import market, interviews were conducted with the following key rubber importers, as
                  identified from the Journal of Commerce, "PEERS" data base:

                         Lewis & Peat Rubber
                         Cooper Tire & Rubber
                         Goodyear International
                         Bridgestone/Firestone
                         Cooper Tire & Rubber
                         E.P. Lambert
                         Alcan Rubber

                                                                  11-10

                          Waterman Steamship

                  The importers indicated that the major consumption points for the imported rubber are in the southern
                  United States:

                          Georgia
                          Mississippi
                          Arkansas
                          North Carolina

                  Inland costs to serve these production plants are key in the port selection. Because of its northern
                  location, the Port of Philadelphia is not in a competitive position to serve the key rubber markets.

                  6.      Metals Exchange

                  Another potential use of warehouse space is the designation of a portion of the Piers 38/40 area as
                  a London Metals Exchange Depository. The London Metals Exchange is the sole non-ferrous metals
                  exchange in existence. Essentially, metal dealers store metals on the exchange in designated
                  warehouses currently located in the following cities:

                          Baltimore (2 warehouses)
                          Toledo
                          Chicago
                          St. Louis
                          Long Beach
                          Bridgeport, CT
                          Detroit

                  Once stored in one of the registered warehouses, the dealers receive warrants for their metals. The
                  warrants are traded on the London Metals Exchange. When the warrants are cashed-in, the metals
                  are taken possession of, and storage costs are paid to the warehouse operator. Typically, the metals
                  remain in storage for about 4 months, at the minimum.

                  When an additional metals exchange facility is deemed to be necessary, the London Metals Exchange
                  will issue a Request for Proposal (RFP). The successfid bidder then receives the official registration.
                  Based on interviews with current metals exchange warehouse operators, this activity does not
                  generate significant throughput at the port, but is an effective method of utilizing vacant warehouse
                  space.

                  To become a registered metals exchange warehouse, the facility must be located within a Foreign
                  Trade Zone (FTZ). Piers 38/40 would need to be included in the current FTZ jurisdiction at
                  Philadelphia, and the Port would have to respond successfully to an RFP issued by the London Metals
                  Exchange.

                 The upper floor(s) of Piers 38/40 could be used for such a metals exchange in combination with other
                 uses of the facility, such as for cocoa beans or imported pulp.

                 7.      Container Freight Station

                 The majority of vessels carrying the imported paper from Scandinavia into Philadelphia return empty.
                 A possible backhaul for these vessels is consumer products (ranging from blue jeans to appliances).
                 These consumer products could be trucked and railed into Piers 38/40, consolidated and
                 containerized at Piers 38/40, The stuffed containers could then be trucked to Pier 80 for loading onto
                 the paper ships. The estimated market potential for this operation is about 15-20 containers per
                 vessel. Piers 38/40 present an attractive facility, given the rail access as well as the limited investment
                 that would likely be required.

                 8.      Cruise Passenger Market

                 The North American cruise market has experienced strong growth over the last 15 years, averaging
                 an annual growth rate of 9.2% between 1980 and 1994. Exhibit 11-4 shows the growth in passenger
                 embarkations in North America.

                                                                  11-12

                                                     Exhibit 11-4
                                               Annual Cruise Passengers
                                                    (Embarkations)

                            MILLIONS OF PASSENGERS (EMBARKATIONS)

                                                                                            4.5 4.6
                          5                                                   3.   4   4.
                                                                         3.
                          4                                     2.9
                                                       2.2 2.6
                          3
                                  .4 1.5 1.

                          0 v
                                           M RT M        0 1'*- M 0        0

                                                         PASSENGERS

                  EXCLUDES ONE-DAY CRUISES
                  SOURCE: CLIA

                                                      11-13

                  There are several types of cruises offered in the North American Market:

                           Caribbean Cruises consist of cruises typically departing from a South Florida port such as
                           Miami, Port Everglades, Port Canaveral, Palm Beach, etc. These cruises range in length from
                           7-10 day cruises to 3-4 day cruises. Also, some one day cruises to the Bahamas are offered
                           out of Port Everglades and Miami. Typically, passengers fly into the port city and are
                           transported directly onto the cruise ship. West Coast passengers generally arrive the night
                           before the cruise, due to airline scheduling from the West Coast to the East Coast. The
                           location of an airport close to the port with non-stop service to key passenger markets is
                           critical to the success of the Port in attracting cruise vessel service for the Caribbean market.
                           The vessels deployed in the Caribbean service tend to be homeported in South Florida, and
                           offer either seasonal (October through May) or year-round service. When not deployed on
                           the dedicated Caribbean trade, these seasonal vessels are deployed in the Alaskan trade or in
                           the European trade.

                           Trans Atlantic market consists of cruises between the Atlantic Coast and Europe, and are not
                           as frequently scheduled as are the Caribbean cruises.            These cruises often involve
                           repositioning a vessel from the Caribbean service to the European service.

                           Trans Canal cruises are cruises from South Florida Ports through the Panama Canal. These
                           tend to be relatively long cruises and may be connected with a call at a Mexican port where
                           passengers are discharged.

                           Bermuda Cruises are cruises from North Atlantic ports such as New York, Philadelphia,
                           Alexandria (Virginia) and Baltimore. The cruise season is limited, and is further restricted to
                           four carriers operating 26-28 calls per year. These companies are Holland America, Royal
                                                                                              2
                           Caribbean, Celebrity Cruise Lines, and Majesty Cruise Lines. The Bermuda market is a
                           relatively small portion of the cruise market, representing less than 3% of total North
                           American cruise passengers.

                           Fall Foliage Cruises are cruises from North Atlantic ports through the Saint Lawrence
                           Seaway, including Nova Scotia, New Brunswick, Newfoundland, Montreal, and Toronto.
                           The season is August to December, and this market accounts for less than 1% of the North
                           American cruise market.

                  With respect to the Port of Philadelphia's potential to enter into the cruise business, the market is
                  limited to Bermuda Cruises, fall foliage cruises and trans Atlantic cruises, due to the location of the
                  Port of Philadelphia. For example, Philadelphia is too far north to serve the

                           2Majesty Cruise Lines has recently ceased operations due to a worsening financial
                  situation.

                                                                     11-14

                  Caribbean market. Distance has become increasingly important as the demand for shorter cruises
                  has increased over time. Exhibit 11-5 shows the growth in the cruise passengers by length of
                  cruise. As this exhibit shows, between 1980 and 1993, the major growth in cruise passengers
                  has been in cruises of 2-5 days in length. The share of passengers on cruises of 9 to 17 days in
                  length, which would be required for a Caribbean cruise from Philadelphia, has fallen from 15 %
                  in 1980 to 9% in 1993.

                                                                Exhibit 11-5
                                     Share of North American Cruise Market by Length of Cruise

                                                                                      2-5 DAYS
                                                                                        24%

                                                                                            18+
                                        6-8 DAY                                              1 %
                                           59%

                                                                                        9-17 DAYS
                                                                                           15%

                                                                 1980

                                                                               2-5 DAYS 37%

                                                                                ......         0%
                                                                          ............

                                                                                     SA     YS 9%

                                         6-8 DAYS 54%

                                                                  1993

                  SOURCE: CLIA

                                                                  11-15

                         As a result, the Port of Philadelphia's most likely cruise markets are Bermuda and the
                 foliage cruises, two relatively small cruise markets.

                         With respect to the use of Piers 38/40 as a cruise terminal, the height of the Walt
                 Whitman Bridge may pose a problem for cruise ships. The Walt Whitman Bridge constrains the
                 air draft of vessels to 150 feet. Martin Associates sampled the air draft of 45 cruise vessels
                 deployed in the North American cruise markets. Exhibit 11-6 shows that the 150 foot clearance
                 of the bridge prohibits nearly 60% of the vessels from transitting under the Walt Whitman Bridge
                 to call Piers 38/40, and more importantly, this bridge height restricts 72% of the North
                 American cruise vessel passenger capacity.

                                                            Exhibit 11-6
                                      Cruise Vessels Excluded from Transitting Under the
                                                      Walt Whitman Bridge
                                            Number of Vessels and Passenger Capacity

                                  PERCENTAGE
                         80%                                                                    71.7%
                                                         ..........   .... ..  .... 57-.7.

                         60%-'
                                              42.2%

                         40%                              28.2%

                         20%-
                           0% V
                                          ABLE TO CALL                            EXCLUDED

                                      % OF VESSELS 0 % PASSENGER CAPACITY

                 SOURCE: SURVEY OF 45 CRUISE VESSELS

                                                              11-16

                        While not the case for cargo vessels, there appears to be a relationship between size
                 (measured in terms of lower berths) and air draft of cruise vessels. The larger the number of
                 lower berths, the greater is the air draft of the vessel. Exhibit 11-7 graphically depicts this
                 relationship.

                                                        Exhibit H-7
                                           Air Draft Versus Lower Berth Capacity

                        AIRDRAFT (FT.)
                  200

                  150-

                  100   ----- --------------------- ----      ---------------------------- - --

                    50  --------------------------------- --------------------------- -----

                     01      1      1     1      1     1     1      1            1     1
                      04     CM    N     04     04    N      CM    CM            CM   04
                      0     0      0     0      0     0      0     0      0      0    0      0
                      C%j    le    0     Go     0     04     IT    (0     co     0    N      Tr
                                                'r"   T"     'r"   'r"    1-'    C*'  C*'    cm
                                   LOWER BERTHS (PASSENGERS)

                                     -HEIGHT -@- BRIDGE HEIGHT

                                                          11-17

                        As this exhibit further demonstrates, the larger the cruise vessel in terms of passenger
                 capacity, the greater will be the air draft. Exhibit 11-8 shows the distribution of the cruise
                 vessels on order. Given this relationship between passenger capacity and air draft, it is to be
                 emphasized that the majority of new cruise vessels on order are over 1500 passengers in
                 capacity, which appears, from the previous exhibit, to be in the range of the passenger capacity
                 which is associated with a vessel air draft in excess of 150 feet. Therefore, since the majority
                 of the new ships on order are not likely to be able to pass under the Walt Whitman Bridge, the
                 market for cruise operations at Piers 38/40 is limited to an even greater extent (than just by the
                 markets).

                                                            Exhibit 11-8
                                             Distribution of Cruise Vessels On Order

                       NUMBER OF VESSELS UNDER CONTRACT

                     6
                     5  ... 5  ------------   5          .............. .......

                     4  ---        ......                ......   ----- ---------               0.499 BERTHS
                               3                                                             0500-999 BERTHS
                                                                                             0 1500-1999 BERTHS
                                                 2               2
                     2  ---        ---------         ------ -   -                            F@2000 BERTHS

                     0
                            1995           1996           1997           1998

                                                  YEAR

               SOURCE: CLIA

                  Based on the limited markets available to the Port of Philadelphia, and the height limitations imposed
                  by the Walt Whitman Bridge on cruise ships calling Piers 38/40, it is estimated that about 18 cruise
                  ships could call Piers 38/40, if the Piers were modified for passenger use.

                  9.      Summary of Market Potential and Economic Impacts

                  The market analysis identified the following opportunities for the re-use of Piers 3 8/40 that should
                  be further evaluated in terms of costs to modify the Piers for the specified purposes. These are:

                          The use of Piers 38/40 for a combined pulp facility, passenger terminal and London Metals
                          Exchange Warehouse

                          The Development of Piers 38/40 to handle cocoa beans.

                  The economic impacts of each of these potential market opportunities were estimated using the
                  Martin Associates' Port of Philadelphia Economic Impact Model, developed for the Philadelphia
                  Regional Port Authority in 1994. Table 11- 1 summarizes the potential impacts associated with each
                  of the identified potential re-uses of Piers 38/40. The impact of the use as a metals exchange is not
                  estimated since this would entail only a warehousing function, which could be handled by those
                  operating the cocoa bean warehouse operation.

                                                                  11-19

                                                          Table 11- 1

                                                  Potential Economic Impacts

                         IMPACTS                 PULP       CRUISE          PULP/          CFS       Coco
                                                                           CRUISE                      A
                                                                          COMBINED

                  JOBS

                         DIRECT                         72           76             148         10        17

                         INDUCED                        36           24              60          5         9

                  TOTALJOBS                           108           100             208         15        26

                  PERSONAL
                  EARNINGS (1,000)

                         DIRECT                    $2,942       $1,664           $4,606       332     $763

                         RE-SPENDING               $2,947       $1,665           $4,612       330    $759
                         (1,000)

                  TOTAL PERSONAL                   $5,889       $3,329           $9,218      $662    $1,522
                  EARNINGS (1,000)

                  BUSINESS REVENUE                 $6,500       $7,996          $14,466      2,182   $7,622
                  (1,000)

                  STATE AND LOCAL                    $436         $412             $848       $58      $105
                  TAXES
                  (1,000)

                                                             11-20

                  As this exhibit shows, the combined use of the facility as a pulp facility and cruise facility will
                  generate the greatest economic impact, creating 208 direct and induced jobs, $9.2 million of personal
                  earnings and consumption expenditures, $14.5 million of business revenue, and $.9 million of state
                  and local taxes. The use of Piers 38/40 for handling 860,000 bags of cocoa beans would generate
                  about 26 direct and induced jobs, $1.5 million of local personal earnings and consumption
                  expenditures, $7.6 million of business revenue, and $.I million of state and local taxes. Finally, the
                  CFS opportunity would likely generate the smallest economic impact.

                  The financial feasibility of each of these opportunities are evaluated in Chapter V.

                                                                  11-21

                                                       M. TRAFFIC ANALYSIS

                  This chapter analyzes the traffic impacts of three alternative development scenarios at Piers 38/40.
                  The three scenarios are:

                          Wood Pulp
                          Passenger Cruise Terminal
                          Cocoa Beans/London Metals Exchange

                  The report documents existing conditions on Christopher Columbus Boulevard. The current rail and
                  truck traffic generated by Piers 38/40 is described. Then, a section on each future scenario describes
                  its impact on rail and truck traffic and other impacts, such as parking.

                  1.      Description of Existing Area Road Network

                  Piers 38/40 are accessed via a single driveway to Christopher Columbus Boulevard. The driveway
                  is located opposite Christian Street. The intersection of Columbus Boulevard, Christian Street and
                  the Piers 38/40 driveway is signalized.

                  Christopher Columbus Boulevard serves as the major north-south street for traffic in the vicinity of
                  PRPA facilities from Piers 38/40 south to the Packer Avenue Marine Terminal. At Piers 38/40,
                  Columbus Boulevard provides three through lanes (50 foot wide) in each direction, plus separate left-
                  turn lanes at the signalized intersections. A curbed median or concrete barrier separates the
                  northbound lanes from the southbound lanes. A single track rail line occupies the median. Rail
                  freight service is provided to the south and as far north as-Piers 38/40. North of Piers 38/40, the rail
                  is currently used only by tourist passenger trolleys in the summer.

                  Piers 38/40 are well serviced by access to 1-95 (see Exhibit 111-1). The on-ramp to 1-95 south is
                  located nine blocks south, and the off-ramp for 1-95 traffic approaching from the south is located four
                  blocks south. The off-ramp for traffic approaching from the north on 1-95 (and from 1-676) is located
                  three blocks north of Piers 38/40. The on-ramp to 1-676 is located at that same intersection. Four
                  blocks further north on Christopher Columbus Boulevard is the on-ramp to 1-95 North.

                  Christian Street and Washington Avenue provide access between Columbus Boulevard and city
                  streets west of 1-95. Since most east-west streets are cut-off at 1-95, Christian Street and Washington
                  Avenue carry significant traffic volume. Washington Avenue provides two lanes in each direction and
                  Christian Street provides one lane in each direction.

                  The Pennsylvania Department of Transportation is currently constructing an improvement to
                  Delaware Avenue from Reed Street to Race Street which includes completion of the "Riverwalk"
                  pedestrian route, some revisions to median openings, and an improved traffic signal system.

                                                                    111-1

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                                                        EXHIBIT 111-2                                 FIGURE 2
      Existing Morning Peak Hour Traffic Volumes- 7:30 to 8:30 AM
      Christopher Columbus Boulevard
      Piers 38/40 Reuse Study
      CITY OF PHILADELPHIA, PENNSYLVANIA
      OCTOBER, 1995

                                                                                             0

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                                                     oo C"                    225
                                                          t-- 473          4  1083          48          120
        CHRISTOPHER  528                      795    *j 4 4-677    -+j        14            571         619  739
        COLUMBUS
        BOULEVARD       348--+             939-0-   239-J          84 J.   f      335 J       326 -J    796--+
                                                    700          1094-+   M 0     1026        796--+
                                                                   17--)
                   4-- \528

                                                                                                         @-o
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                                                                               IER
                                                                           138/40

            rt4WgeWAsMWes,WN                           M M M = = M = = = = = M
                                                                  EXHIBIT 111-3
                                 SE-I.E$                                                                                  FIGURE 3
      Existing Evening Peak Hour Traffic Volumes- 4:30 to 5:30 PM
      Christopher Columbus Boulevard
      Piers 38/40 Reuse Study
      CITY OF PHILADELPHIA, PENNSYLVANIA
       OCTOBER, 1995

                                                                                                              0
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                                                                        461      CA)     4 1378            k-58        (--202
         CHRISTOPHER     837                          1254                       J       j-15     4)       -+.-886        962 +-1164
         COLUMBUS           685--+                 1281 -40-  178              60-J'     t r      383-J         :348 J      999
         BOULEVARD                                           1103            1530-+     a) 44    1347           999-+
                                                                                7-)

                                                                                                      F
                                                                                                                       4W
                                                                                           PIERS
                                                                                           38/40
                                                                                                                          I
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                                                                                                                         0
                                                                                                                         0

                  1.1    Existing Traffic Volumes

                 Manual turning movement traffic counts were conducted in October 1995 during the morning and
                 evening peak traffic periods at six intersections on Christopher Columbus Boulevard. They include:

                         Christian Street/Piers 38/40 driveway
                         Washington Avenue
                         1-95 northbound off-ramp
                         1-95 southbound on-ramp
                         1-676,1-95 southbound off-ramp/I-676 on-ramp
                         1-95 northbound on-ramp

                 The peak hour volumes are illustrated on Exhibit 111-2 for the morning peak hour from 7:30 A.M. to
                 8:30 A.M. and on Exhibit 111-3 for the evening peak hour from 4:30 P.M. to 5:30 P.M.

                 The area at Piers 38/40 is the most heavily travelled section of Christopher Columbus Boulevard, as
                 indicated by Table III-I below. It is interesting to note that current traffic volumes are similar to
                 counts taken in November 1993 by Urban Engineers.

                                                             TABLE HI-I
                    TWO-WAY TRAFFIC VOLUME ON CHRISTOPHER COLUMBUS BOULEVARD

                                                    ... ........                    ...... . ... ..
                                                                       -n P
                                                                    A
                                          10.4                              VA ... 00
                                                                         . ... . ..... ....
                                     ....... . ....
                                    ..... ........ .......... ............ ............... ... V:I
                                                                                                     V
                                                                           ....... ......
                                                                                .. .....    .... . .

                   South of 1-95 southbound on-ramp                          876                      1522

                   1-95 southbound on-ramp to                              1191                       2034
                   1-95 northbound off-ramp

                   1-95 northbound off-ramp to Washington                  1734                       2535
                   Avenue

                   Washington Avenue to Christian Street                   2345                       3044

                   Christian Street to Double Ramps                        2682                       3451

                   Double ramps to 1-95 northbound on-                     1741                       2291
                   ramp

                   North of 1-95 northbound on-ramp                        1535                       2163

                                                                 111-5

                  Evening peak hour volumes on Columbus Boulevard in the vicinity of Piers 38/40 are about 30%
                  higher than morning peak hour volumes. Therefore, the evening peak hour was analyzed for
                  purposes of determining traffic impacts of alternative developments.

                  1.2     Existing Levels of Service

                  Volume capacity analysis was performed for the six study intersections using the evening peak hour
                  traffic volumes. it was assumed that roadway conditions and traffic signal operation will be in
                  accordance with plans for the PennDOT Delaware Avenue improvement project. Resulting levels
                  of service are shown in Exhibit M4. As indicated, the existing roadway network operates generally
                  at an acceptable level of service. The only location with an unsatisfactory level of service is the right
                  turn exiting at the double ramp which is expected to operate at Level of Service 'E' during the evening
                  peak hour.

                  1.3     Existing Traffic Generated by Piers 38/40

                  The current use of Piers 38/40 is warehousing of paper products. Most is trucked in from PRPA
                  Piers 78/80 at Snyder Avenue. The paper departs via either truck or rail. The traffic counts
                  conducted in October, 1995 at the Piers 38/40 driveway indicated that 30 to 50 vehicles use the
                  driveway hourly during hours of operation (total entering and exiting), 20% of driveway traffic is
                  tractor trailers.

                  Rail service to Piers 38/40 approaches from the south. Trains must travel north past Piers 38/40 and
                  then reverse into the siding. Likewise, when exiting, the train turns right (north), travels past the
                  switch, and then reverses to travel south on the main track. During these entering and existing
                  movements, northbound traffic on Delaware Avenue is stopped. Southbound traffic on Delaware
                  Avenue is not affected. Three railroads have operating rights on the tracks --- CSX, Conrail, and
                  Delaware and Hudson. Currently, Conrail provides most of the rail transport for Piers 38/40.

                  All trains pass through the South Philadelphia rail yard. According to the Yardmaster, because of
                  scheduling requirements of service to Snyder Avenue, the yard will allow only one trip per day to
                  Piers 38/40 for each of the three railroads. They are scheduled as follows: CSX - 11:00 A.M. to
                  4:00 P.M.; Conrail - 6-00 P.M. to Midnight; D&H- 11:00 P.M. to 4:00 A.M. Trains operate five
                  days per week year round. On occasion, weekend runs are made but these are not regular runs. The
                  yardmaster indicated that any increase in demand would be met by adding cars to the train rather than
                  allowing a second train per day.

                  Under current conditions, one train per day with seven to ten cars travels to Piers 38/40. This results
                  in two periods of traffic closure on northbound Delaware Avenue (one for entering, one for exiting)
                  sometime between 6:00 P.M. and Midnight.

                                                                    111-6

      [Wrth-"Wer-AWsscOMs.itOW                      IIIIIIIIIN =                  M                      = M                   IIIIIIIIIN
      =        .  --.'   .  -E E-EEA- SIE-rS                         EXHIBIT 111-4                                                  FIGURE 4
      Existing Evening Peak Hour Levels of Service
      ','J'hristopher Columbus Boulevard
      Piers 38/40 Reuse Study
      r.'%ITY OF PHILADELPHIA, PENNSYLVANIA
      OCTOBER, 1995

                                                                                                                       0
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                                                                    6)                              B11    LL1
        CHRISTOPHER                                                                                  111)                         t-coa)
                                                          B(9                                      D(28)                          4--D(28)
         COLUMBUS                                                  41 Lo.     D(29)   *TT                         4MC(18)
         BOULEVARD                           Q16)                D(38)            D(30) J'              C(24)          C(23)
                                                                 B(i 1)                                  AW
                                                                                  B0 1)       Q16)

                                                                                                  PIER
                                                                                                  38/40

                  2.      Traffic Impact of Wood Pulp Scenario

                  Under this scenario, Piers 38/40 would warehouse wood pulp which would arrive by ship directly at
                  the pier. Truck movements between Piers 38/40 and Piers 78/80 which occur today would be
                  eliminated.

                  It is anticipated that most of the pulp would depart by rail. The estimated volume is 200,000 tons
                  annually.

                  With five day per week operation (250 days per year), about 800 tons of pulp would be moved on
                  an average day. Assuming that a rail car holds 70 tons of pulp, an average of I I to 12 carloads per
                  day would be transported.

                  As long as the pier operator used a single rail carrier, the number of trains per day would be one train,
                  i.e., the same number of trains as under current conditions. This is because of the restriction on
                  scheduling imposed by the South Philadelphia yard. However, the increased train length might result
                  in additional closures for switching movements to move all of the cars within the pier, since the siding
                  track length within the pier (440 feet) can accommodate only about 8 cars.

                  Even so, the traffic impact of using Piers 38/40 for pulp storage is negligible if rail movements
                  continue to be made on week nights, because the traffic volume on Delaware Avenue is much lower
                  after 7:00 PM.

                  3.      Traffic Impact of Passenger Cruise Ship Terminal Scenario

                  This scenario calls for a passenger terminal that would accommodate a cruise ship of up to 1100
                  passengers. Approximately 18 sailings per year are assumed, with a six to seven day cruise duration.

                  3.1     Trip Generation of Cruise Ship Terminal

                  Traffic related to a cruise ship consists of several components --- the passengers, the staff, and service
                  and provisioning (fuel, food, etc). It is assumed that service and provisioning will either occur
                  elsewhere, or if at Piers 38/40 it will occur well before passengers begin to arrive.

                  Regarding the staff, most of the employees on the ship itself are foreign. They remain on the ship
                  until their tour of duty is over. About five to ten percent of this staff may turn over per ship call and
                  are shuttled between the airport and the ship terminal by bus.

                  Only a small percentage of the staff, including the staff of the passenger terminal itself, will live in the
                  Philadelphia area and generate driving trips and parking demand. Employees are likely to arrive
                  before and depart after the pasengers so that their trips will not occur during the same time period
                  as passengers.

                                                                     111-8

                  The passenger arrivals and departures will generate most of the traffic associated with a cruise ship
                  terminal. In order to convert passenger volume to vehicle trips, the following assumptions are made
                  regarding mode split and vehicle occupancy.

                          Assume I 100 passengers, maximum

                                  50% Auto (drive) at two passengers per vehicle
                                  25% Auto (drop-off) or taxi at two passengers per vehicle
                                  25% Shuttle at six passengers per vehicle

                          Average vehicle occupancy rate = 3.0 persons per vehicle.

                  It is recognized that the number of passengers who drive to the terminal and park will be directly
                  related to the availability, cost, and security of long term parking. It will also be related to the
                  availability and cost of shuttle service, which might be arranged by travel agents as part of the travel
                  package. However, based on the stated assumptions, the estimated number of trips generated by
                  passengers is as follows:

                                                                  Inbound         Outbound         Total
                          Ship Departure                          460               180             640
                          Ship Arrival                            180               460             640

                  Passenger trips are likely to be spread over a two to three hour period prior to ship departure, but
                  may be concentrated within an hour or 90 minutes upon the ship's arrival back in Philadelphia.

                  The projected peak hour trips generated by a cruise terminal are illustrated on Exhibit 111-5. The
                  projection assumes that there is long term parking on Piers 38/40. Parking is discussed further below.

                  Volumetcapacity analysis of area intersections with the addition of passenger cruise terminal traffic
                  shows that, in general, sufficient roadway capacity exists on the external streets. This scenario can
                  be accommodated with good levels of service, as long as cruises arrive and depart on a weekend, or
                  midday on a weekday.

                  Areas of concern for this scenario are 1) parking, and 2) internal vehicle circulation for drop-off and
                  pickup.

                  3.2     Parking for Cruise Ship Terminal

                  The estimated parking demand for the cruise terminal scenario is 300 spaces, given the previous
                  assumptions on mode split. As noted earlier, this mode split is probably flexible depending on the
                  availability of parking.    Security is also extremely important to any long term parking at the
                  waterfront. Although there are some public parking lots north of this area, none provides long term
                  parking with 24-hour security. Parking might be handled in several ways:

                                                                   111-9

                                                                                 M 1=1 MIMI mm'm
             7@e@Wss
                                                        EXHIBIT 111-5                                          FIGURE 5
      Additional Peak Hour Traffic Volumes Generated by Cruise Terminal
      Christopher Columbus Boulevard
      Piers 38/40 Reuse Study'
      CITY OF PHILADELPHIA, PENNSYLVANIA
      OCTOBER, 1995

                                                                                                    0
                                                                                                 C6 C:
                                                                                                    Co
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                                                                                                    M

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                                                                                            LO
        CHRISTOPHER                                                              4-299
                                  63          4--63            +-63                              -4--46     +--46  -.%-46
        COLUMBUS                                                                                   --
        BOULEVARD                                                      16 1                45-J       54 J       18---
                                                                               CV)         72-+       18--+
                                                                           CD)
                                                                           V
                                                                           /C?

                                                                                   P
                                                                                          S
                                                                                     IER
                                                                                 '38/40

                  Parking within the pier itself would have the advantage of being convenient and secure. The
                  disadvantage is that the space would be used only 16-18 weeks out of the year. Therefore providing
                  parking on the pier is not an option and parking must be provided offsite.

                  Off-site parking requires that shuttle transportation to the cruise terminal be available. It is most
                  feasible if there is one designated lot. This allows clear directions to be given to the traveller in
                  advance, and concentrates passengers for shuttle service. Since cruises are scheduled, it may be
                  possible to contract with an existing long term parking lot in the airport area to provide parking and
                  shuttles to the cruise ship terminal, a 15-minute trip via 1-95.

                  If long term parking is to be provided off site but close to the terminal, it should be located in the area
                  between Tasker Street and Christian Street. This area provides convenient access via the 1-95 ramps.
                  In the area north of Christian Street, limited land and demand for parking for Penns Landing and
                  South Street precludes a large long term parking lot.

                  Open lots do exist in the area south of Christian Street. However, this land is optioned to riverboat
                  gaming interests. Approximately 2.5 to 3 acres would be needed to park 300 cars. The availability
                  of land and the economic viability of providing a parking lot for use 18 weeks per year would need
                  to be determined.

                  3.3     Internal Vehicle Circulation at Cruise Ship Terminal

                  The vehicle entrance to Piers 3 8/40 is at the southern end of Pier 40 at the signalized intersection of
                  Delaware Avenue and Christian Street. The circulation for passenger drop-off for a cruise ship
                  terminal would involve a counter clockwise movement with vehicles making a U-turn after the drop-
                  off in order to return to the driveway to exit. This U-turn must accommodate buses; the outside
                  radius for bus turns is 60 feet. Up to 250 vehicles per hour would utilize the drop-off/pickup zone,
                  and these vehicles would be unloading or loading luggage. Vehicle stacking length of about 500 feet
                  should be provided. The vehicle stacking, bypass of stacking, and U-turn capability would have to
                  be provided either in the open pier between the two buildings, or in the area between Christopher
                  Columbus Boulevard and the buildings.

                  4.      Traffic Impact of Cocoa Bean Scenario

                  Cocoa beans currently are shipped in to Pier 84. Under this scenario, Piers 38/40 would be used to
                  increase the import capacity. The cocoa beans would be trucked to Pier 84 for value-added work.

                  No rail transport is anticipated under this scenario, However, direct rail could occur, if manufactur-
                  ers do not require super-sacked beans or bulk truck deliveries. For planning purposes, it is assumed
                  that the maximum volume of beans to be trucked out of Piers 38/40 annually is 800,000 to 1,000,000

                 bags of 142 pounds each, or 57,000 to 71,000 tons annually. This is the equivalent of about 3,000
                 annual truckloads or an average of 12 truckloads per day.

                 The cocoa bean scenario results in reduced highway traffic compared to existing conditions. Even
                 if rail moves occurred, the rail move would not likely exceed the single daily rail trip.

                                                                111-12

                                       IV. CONCEPTUAL DESIGN FOR MARKET RE-USE

                  Based on the market analysis, there are three viable uses for this facility: pulp paper; cocoa beans;
                  and cruise ship terminal and/or London Metals Exchange. Of these three uses the pulp paper and
                  cruise terminal/London Metals Exchange use could be combined into one concurrent use whereby
                  the pulp paper facility is located on the first floor of the warehouse and the cruise terminal and/or
                  London Metals Exchange located above. That is, the first floor of each building will be used for the
                  pulp paper facility and the second floor of one building could be used for a cruise ship terminal and
                  the second floor of the other building could be used for the London Metals Exchange. The cocoa
                  bean facility will be a stand alone use. Therefore, there will be only two conceptual designs
                  delineated for this study plan.

                  1.      Cocoa Bean Facility

                  Cocoa beans arrive at the pier in small cargo vessels. Because of the limited draft along the upstream
                  and downstream sides of the pier structures it is assumed for this report that the vessels will berth
                  along the marginal wharf.

                  Food quality upgrade of the facility will be required. Assuming this facility will be upgraded in a
                  manner similar to that at Pier 84, the following amenities will be required: 1) a system of plastic strip
                  partitions to segregate individual areas from each other; 2) an in-house fogging system to limit insect
                  growth; 3) the interior steel must be painted (previous experience indicates that there will be the need
                  for lead paint removal); 4) a active ventilation system which can be accommodated by installation of
                  fans into replacement wall panels. (No roof ventilators were required for the Pier 84 renovations);
                  and 5) seal and level the floor with a heavy duty epoxy.

                  Cocoa beans are shipped in small cargo vessels and come packed in bags which are paletted with 25
                  bags per pallet. Each bag weighs about 140 pounds and the pallets are usually stacked 4 high. The
                  footprint of a pallet is 6' x 4'6". The pallet weighs 1000 pounds. Therefore, the load is 140 lbs. x
                  25 bags x 4 high == 14,000 pounds plus 4 pallets at 1000 pounds per pallet, = 18,000 pounds per (6,
                  x4.5'=27sf)27squarefeet=666.67psf This exceeds the design allowable live load of the first
                  floor of the buildings on Piers 38 and 40 by 33%. Stacking the pallets only 3 high produces a load
                  of 500 psf which is the design allowable live load of the first floor. It should be stressed that the live
                  load capacity should be reevaluated based on a structural investigation of existing conditions before
                  assuming that the design live load is appropriate for the structure in its current condition. Therefore,
                  the user should be informed of the restriction that they may not stack the pallets more than 3 high if
                  no limitations to the allowable loads are found in the structural analysis. The allowable live load
                  should be posted inside the building to prevent overstressing the floor. The entire cocoa bean
                  operation will be limited to the first floor of each pier structure. A plan of the proposed cocoa bean
                  facility is shown in Exhibit IV-1.

                                                                     IV- I

                                                                        DELAWARE AVENUE

                                                                                               RAILROAD
                                                                                BULKHEAD LINE TRACK (Typ.)
                                                                                           .V
                                                                                -----------   ........................... ......

                                                              PIER 40
                                                            WAREHOUSE         OPEN PIER         PIER 38          BOLLARD (TYR)
                                                                                              WAREHOUSE
                                                                              620,
                                                       F'RS-r FLOOR USE:
                                                       COCOA BEANS
                                                       SECOND FLOOR                       FIRST FLOOR tj
                                                      USE:                                            SE:
                                                      NONE                                COCOA BEANS    if
                                                                                         SECOND FLOOR    11
                                                                                         USE:
                                                                                    I    NONE

                                                                                   p

                           .....................                                                              ...... ................

                                PIERHEAD LINE

                                                                       DELAWARE RIVER

                                                                             PLAN
                                                                             N.T.S.

                                                                                                                      COCOA BEANS
                                                                                                                 PIERS 38-40 REUSE PLAN
                                                                                                         PHILADELPHIA REGIONAL PORT AUTHORITY
                                                                                                         DECEMBER1995                  EXHIBIT IV-1

                   2.      Pulp Paper/Cruise TerminalALondon Metals Exchange Facility

                   2.1     Pulp Paper Facility

                   Pulp arrives at the pier in cargo vessels requiring a 38 foot draft. Because of the limited draft along
                   the upstream and downstream sides of the pier structures it is assumed for this report that the vessels
                   will berth along the marginal wharf.

                   Unloading of the cargo vessels requires 40 feet free for the swing of the ship's crane. The current
                   marginal wharf is only 18 feet deep, therefore, it will be necessary to remove a portion of the end of
                   the building to provide the required room for the ship's crane to operate. This is possible because
                   the building is a steel framed structure which is designed and built in bays. The building can be
                   shortened along structural bay lines and reconstructed by replacing, in the new end walls, the
                   structural components which were removed in the old ones and making the proper connections.
                   Additionally, it is desired to maintain the existing storage area within the warehouse. Modifications
                   required to maintain the existing square footage of the building could include constructing a lean-to
                   type pre-engineered metal building on the exterior (non open pier side) of each building to provide
                   the expansion space. It is preferable to have a 25 foot high opening into the warehouse for moving
                   the cargo inside. Since the clear height of the first floor of the building is only 22 feet, it is not
                   possible to accommodate a 25 foot tall overhead door opening. The overhead door opening will be
                   limited to under 20 feet depending on the manufacturer's specifications because of hardware and
                   installation requirements at the top of the overhead door. The overhead doors at Pier 80, which is
                   currently being used as a pulp paper facility, are 18 feetAride by 18 feet high and function adequately.

                   Pulp paper arrives unitized. The bales are 32" x 32" x 68" high and weigh up to 560 pounds each.
                   They are traditionally grouped in 8 bales (4 high by 2 across) creating a unit which could weigh up
                   to 4500 pounds. If the bales are stacked I high, the weight is 4500 pounds per 5'-4" x 2'-8" = 14.22
                   square feet or 315 psf which is less than the design allowable live load on the existing floor structure.
                   Once again, it should be reiterated that the design five load may not be the current allowable live load
                   due to structural deterioration, and that further investigation is required to confirm the appropriate
                   allowable five load for the structure. Either way, the user could not stack the bales because of floor
                   load limitations. Additionally, because the clear height of the first floor is approximately 22 feet, load
                   limitations should be posted and enforced to protect the structural integrity of the building.

                   2.2     Cruise Ship Terminal

                   Cruise ships are limited in size by the Wait Whitman Bridge, however, the average draft of a 1000
                   passenger ship is greater than 20 feet. Therefore, because of the limited draft along the upstream and
                   downstream sides of the pier structures it is assumed for this report that the cruise ships will berth
                   along the marginal wharf.

                   The vessels forecasted to frequent Piers 38 and 40 include Bermuda (9 calls per year) and fall foliage
                   (9 calls per year) and assume up to 1,000 passengers per vessel. There are no established criteria

                                                                     IV-3

                 for area requirements for cruise terminals, however, the rule of thumb is to allow for 20 square feet
                 per passenger. Assuming that the largest vessel to dock at Pier 40 has a capacity of 1,000 passengers,
                 the required square footage of the terminal would be (20 x 1000 = 20,000) 20, 000 square feet. The
                 warehouse area is much larger than this, so there is more than adequate space for the cruise terminal.
                 (Based on passenger handling requirements determined by the airline industry, the need to
                 accommodate 1500 passengers would result in the following minimal requirements- a baggage area
                 of 15,000 square feet, a departure area of 6,000 square feet and a ticket queuing area of 9,000 square
                 feet.)

                 The cruise terininal will occupy the second floor of one of the two pier buildings. The second floor
                 is desirable because the elevation of the access portals of cruise vessels averages about 25 feet above
                 the water fine. Utilizing the second floor makes access to and from the ship more comfortable for the
                 passengers. This also helps to clear the wharf area for cargo and baggage operations. The design live
                 load capacity of the second floor of the buildings is 240 pounds per square foot, and should be posted
                 and enforced in the cargo handling areas.

                 Improvements to the structure will include a passenger elevator, freight elevator and exterior
                 sheltered stairway to access the second floor, restrooms for passengers, a passenger loading bridge,
                 upgrades to accommodate baggage handling activities, and general architectural amenities to develop
                 a passenger terminal including upgrades to provide access in accordance with ADA
                 recommendations. Photographs of existing cruise terminal passenger loading bridges have been
                 included to provide an example of this piece of equipment.

                 Additional improvements will include constructing a passenger drop-off/pick-up area and perhaps
                 some parking in the area of the open pier.

                 2.3     London Metals Exchange

                 Based on the information developed during the market analysis phase of this study, there is no special
                 remediation required for the second floor of either warehouse to accommodate the London Metals
                 Exchange. It would be necessary to limit the live loads to 240 pounds per square foot or less as
                 determined by structural analysis.

                 A plan of the pulp paper/cruise terminaL/London Metals Exchange is shown in Exhibit IV-2.

                 3.      Cost Estimates

                 Complete cost estimates have been prepared for each of the two re-use options. These costs include
                 the base construction cost to upgrade the buildings for compliance with local codes and standards in
                 addition to the special requirements of each individual re-use. These costs are to be used as ballpark
                 estimates and do not reflect specific costs for specific construction work. The total estimated cost
                 to upgrade the Pier 38 & 40 site for re-use as a combination cocoa bean facility/cruise
                 terminaVLondon Metals Exchange would be $7,098,000.00. The total estimated cost to upgrade the

                                                                  IV-4

                                    Typical Passenger Loading Bridge

                                                             - - --------

                                          MONO

                                    0     MOWN....

                                                                       Nunn

                                    Typical Passenger Loading Bridge

                                                   IV-5

                                                                      DELAWARE AVENUE

                                                                                            RAILROAD
                                                                              BULKHEAD LINE TRACK (TYP.)
                                                                                      . V
                                                                                    .. . ...........................

                                                            PIER 40
                                                                            OPEN PIER
                                                                                             PIE 38

                                                                             62o,
                                                                                                             AREA OF PROPOSED NEW
                                                      FIRST I'Loo
                                                               R USE                                         WAREHOUSE SPACE TO
                                                      PULP pApER                                                           REMOVAL
                                                                                                             REPLACE ARE OF
                                                                                                             (Typ.)
                                                          N                             FIRST FLOO
                                                     SECO D FLOOR                       PULP pAp R US
                                                     USE:             11           '! I        ER
                                                     CRUISE             PASSENGER  I
                                                           TER            Rop-OFF/
                                                              MINAL                    SECONDFLOOR
                                                                         PICK-Up       USE: LOND DN
                                                                           AREA
                                                                                       EXCHANG
                                                                                              E

                                                                         rA7                               REA OF BUILDING TO BE
                                                                              RAMP                        REMOVED (TYP.)
                                - --------------                                                              ......     .......

                              PIERHEAD LINE

                                                                     DELAWARE RIVER

                                                                           PLAN
                                                                           N.T.S.

                                                                                  PULP PAPER/CRUISE TERMINAL/LONDON METALS EXCHANGE
                                                                                                   PIERS 3840 REUSE PLAN
                                                                                          PHILADELPHIA REGIONAL PORT AUTHORITY

                                                                                  DECEMBER 1995                                EXHIBIT IV-2

                 Pier 3 8 and 40 site for re-use as a pulp pape r facility is $6,713,000.00. Breakdowns of the individual
                 components comprising the cost estimates follow as Exhibit IV-3 through IV-9.

                                                                IV-7

                                                              EXHIBIT IV-3

                                                   Summary of Estimated Costs

                            General Building Requirements

                            Pier 38                           $ 2,185,000.00
                            Pier 40                           $ 1,770,000.00
                            Substructure                      $     300,000.00
                               SubTotal                       $  4,255,000.00

                            Pulp Paper/Cruise Terminal/London Metals Exchange Facility

                            Pulp Paper                        $  1,160,000.00
                            Cruise Terminal                   $     500,000.00
                            London Metals Exchange            $            -
                               Sub Total                      $  1,660,000.00
                            Plus General Building             $  4,255,000.00
                            Contingency @ 20%                 $  1,183,000.00
                            Total Pulp Paper Alternative      $  7,098,000.00

                            Cocoa Bean Facility

                            Cocoa Bean                        $  1,375,000.00
                            Plus General Building             $  4,255,000.00
                            Contingency @ 20%                 $  1,083,000.00
                            Total Cocoa Bean Alternative      $  6,713,000.00

                             Does not include an estimate for possible additional structural rehabilitation

                                                                    IV-8

                                                                    EXHIBIT IV-4

               Pier 38 ( estimate prepared by O'Donnell & NacGarato, Inc.)

               1. Upgrade doors to conform to fire rating direction of swing and proper hardware.               $    35,000.00
               2. Demolish obstructing walls in stair tower as required for unimpeded exit.                     $      5,000.00
               3. Demolish barricade in southwest and northwest stair towers.                                   $      5,000.00
               4. Provide illuminated signs and lighting for exit doors with emergency battery pack.            $    25,000.00
               5. Provide emergency generator and extend circuits to first level lights to provide
                   emergency lighting within pedestrian paths in the warehouse area.                            $    40,000.00
               6. New roof.                                                                                     $   130,000.00
               7. Remove cargo mast, clean and paint exterior.                                                  $   360,000.00
               8. New window panels.                                                                            $    50,000.00
               9. Replace 5 first floor overhead doors.                                                         $    50,000.00
               10. Remove second floor doors and seal permanently.                                              $    70,000.00
               11. Sawcut and caulk vertical control joints at east & west elevation concrete sidewalks.        $    30,000.00
               12. Remove all loose, deteriorated concrete from east and west elevations.
                   Repair to original condition and paint.                                                      $    80,000.00
               13. New sprinkler system.                                                                        $   700,000.00
               14. Repair seawall.                                                                              $   230,000M
               15. Repair parking lot, place asphalt overlay and repair/replace concrete walks.                 $   150,000.00
               16. Replace main electrical service distribution equipment.                                      $    75,000.00
               17. Install mechanical ventilation system (depending on future use).                             $    60,000.00
               18. Provide direct exit discharge from exit stair ways above east side.                          $    20,000.00
               19. Fully enclose existing stair tower to conform to present code requirements and
                   create rated exit corridor leading from bottom of mezzanine stair to existing exit.          $    30,000.00
               20, Provide one hour rated shaft enclosure at elevator and other floor openings between
                   the first and second floors or close off floor opening not being utilized.                   $    20,000.00
               21. Upgrade interior stair enclosures to conform with fire 1 hour separation assemblies
                   at west side.                                                                                $    20,000.00

                                                                                       Total                    $2,185,000.00
                                                                                       TOTAL PIER 38              $2.2 Million

                 Items 1-5, 14, 16-21 include 15% mark-up for consultant design and construction
                management fees.

                                                                         IV-9

                                                                    EXHIBIT IV-5

                  Pier 40 (estimate prepared by O'Donnell & Naccarato, Inc.)

                  1. Upgrade doors to conform to fire rating direction of swing and proper hardware.              $     35,000.00
                  2. Provide illuminated signs and lighting for exit doors with emergency battery pack.           $        5,000.00
                  3. Provide emergency generator and extend circuits to first level lights to provide
                      emergency lighting within pedestrian paths in the warehouse area.                           $     25,000.00
                  4.  New roof.                                                                                   $     130,000.00
                  5.  Remove cargo mast, clean and paint exterior.                                                $     360,000.00
                  6.  New window panels.                                                                          $     50,000.00
                  7.  Replace 5 first floor overhead doors.                                                       $     50,000.00
                  8.  Remove second floor doors and seal permanently.                                             $     70,000.00
                  9.  Sawcut and caulk vertical control joints at east & west elevation concrete sidewalks.       $     30,000.00
                  10. Remove all loose, deteriorated concrete from east and west elevations.
                      Repair to original condition and paint.                                                     $     80,000.00
                  11. New sprinkler system.                                                                       $     700,000.00
                  12. Replace main electrical service distribution equipment.                                     $     75,000.00
                  13. Install mechanical ventilation system (depending on future use).                            $     60,000.00
                  14. Provide direct exit discharge from exit stairways along east side.                          $     25,000.00
                  15. Upgrade means of egress to mezzanine to conform to present code requirements.               $     30,000.00
                  16. Upgrade interior stair enclosure to conform with fire 1 hour separation assemblies.         $     20,000.00
                      at west side.
                  17. Provide one hour rated shaft enclosure at elevator and other floor openings between         $     20,000.00
                      the first and second floors or close off floor openings not in use.                         $     20,000.00

                                                                                         Total                    $   1,770,000.00
                                                                                         TOTAL PIER 40              $1.8 Million

                                                                        IV-10

                                                                  EXHIBIT IV-6

                                                                  Substructure

                  Repairs to Substructure*

                  1. Replace 34 piles                                       $      50,000.00
                  2. Repair 100'x 100'area of timber decking and repave     $    200,000.00
                  3. Replace fender system along marginal wharf             $      50,000.00

                  Total                                                     $    300,000.00

                  *These costs do not reflect an estimate for possible additional substructure or building structure remediation

                                                                      IV-11

                                                                  EXHIBIT IV-7

                                                                 Cocoa Facility

                                         1. Coat floors with epoxy                      $   250,000.00
                                         2. Remove lead paint and repaint               $   650,000.00
                                         3. Install plastic partitions                  $   125,000.00
                                         4. Install fogging system                      $   200,000.00
                                         5. Active ventilation system                   $   150,000.00

                                         Total                                          $ 1,375,000.00

                                                                      IV-12

                                                                    EXHIBIT IV-8

                                                                     Pulp Facility

                         Structural Changes

                         1. Remove east end of each building.                                                 $    50,000.00
                         2. Build pre-fabricated building along side of building.                             $   400,000.00
                         3. Provide 18'tall by 18'wide overhead doors on eastern face of buildings.           $    10,000.00
                         4. Rebuild facade with architectural details similar to existing.                    $   120,000.00

                         Total per building                                                                   $   580,000.00

                                                                        IV-13

                                                                   EXHIBIT IV-9

                                                           Cruise Terminal (20,OOOSF)

                              1 .Provide passenger elevator to second floor.                           $ 80,000.00
                              2. Provide freight elevator to second floor.                             $ 100,000.00
                              3. Provide exterior sheltered stairway to second floor.                  $ 70,000.00
                              4. Provide restrooms for passengers.                                     $ 50,000.00
                              5. Provide passenger loading bridge.                                     $ 100,000.00
                              6. Provide architectural amenities to develop a passenger terminal.      $ 50,000.00
                              7. Provide upgrades to accommodate baggage handling activities.          $ 50,000.00
                              Total                                                                    $ 500,0,00.00

                                                                       IV-14

                                                 V. FINANCIAL IMPLICATIONS

                  In the previous chapter, the costs for the re-use options were presented for the pulp operation as
                  well as the combined use of Piers 38/40 as a cocoa bean terminal, cruise terminal and London
                  Metals Exchange (LME) facility. To recap, the cost for modifying Piers 38/40 for use as a cocoa
                  facility is estimated at $6.7 million, and the cost of the re-use option as a combined pulp, cruise
                  ship, and LME facility is about $7.1 million.

                  In order to assess the financial feasibility of the recommended modifications for the two re-use
                  alternatives, the debt service costs associated with the development costs of each option were
                  estimated. Assuming a 20 year bond at 7% interest, the annual debt service cost for these two re-
                  use options are:

                         $633,660 for the cocoa bean facility development

                         $613,365 for the pulp facility excluding the $500,000 cost of development of a cruise
                         terminal. With full development of both a pulp facility and a passenger terminal (excluding
                         the costs of developing parking facilities), the annual debt service is $670,001

                  In order to cover only the annual debt service (excluding maintenance and operating costs) for the
                  modifications to handle the pulp, and excluding the cruise ship modifications, the PRPA would
                  need to collect about $3.07 per ton of pulp, assuming an annual throughput of 200,000 tons. If
                  the pulp were to double to 400,000 tons, the debt service cost per ton would be cut in half to
                  about $1.50 per ton. By comparison, the annual total lease revenue received by the PRPA on
                  current facilities handling paper ranges from $1.29/ton to $1.34 per ton, including the revenue
                  received from the lease with the stevedore handling the paper at Pier 90. Based on the current
                  lease structure for paper handled at PRPA facilities, it would appear that the charges required to
                  cover only the annual debt service on the pulp re-use option, excluding the cruise ship
                  modifications, will be prohibitive from a competitive situation. However, if the debt service is not
                  covered by the operation, then it is questionable whether such a re-use option should be perused.
                  One method of covering the annual debt service would be to charge a passenger facilities tax
                  equal to the debt service on the combined use of the facility. However, this would amount to
                  $33.84 per passenger, assuming 1100 passengers per cruise and 18 cruises per year.

                  With respect to cocoa beans, the annual debt service to modify Piers 38/40 to food quality is
                  $633,660. Assuming this cost is allocated to the incremental cocoa bean tonnage -- 63,900 tons-
                  - that could be identified as moving via the Port due to expanded on-dock storage, the annual debt
                  service cost per ton of cocoa bean imports is $9.92. Such a rate would affect the competitive
                  position of the Port of Philadelphia in handling the beans.

                  Finally, if the facility is used as a CFS operation, the $4.3 million baseline building improvements
                  will still be required, even though no additional modifications will be necessary (assuming no

                                                                  V_ I

                 additional costs for substructure). The debt service costs to cover the $4.3 million is about
                 $482,000 annually, which would require an assessment of $482 per container, assuming 1,000
                 containers were handled at the CFS operation for backhaul shipments to eastern Europe and
                 Scandinavia. A charge of $482 per container would offset the advantage of a near dock CFS
                 operation, and, hence, the CFS opportunity would be non-competitive.

                 Based on this financial analysis of the development costs associated with each re-use identified, it
                 would appear that if Piers 3 8/40 were leased to a terminal operator, the cost per ton of the annual
                 debt service would render the facility non-competitive. If a lease charge was also developed to
                 cover annual maintenance costs, the Port's charges on a per ton basis would be prohibitive from a
                 competitive standpoint. This analysis would suggest that neither of the re-use options makes
                 economic sense because of the large amount of capital dollars required at Piers 38/40. The
                 majority of these costs ($4.3 million) are not related to specific re-use modifications, but instead
                 are the result of the $4.3 million needed to bring the facilities up to code, regardless of re-use. It
                 is further emphasized that these costs do not include any estimate for possible additional
                 substructure rehabilitation.

                 Due to the high cost of development, the PRPA could operate the facility, most likely as a pulp
                 facility, and establish a wharfage, dockage, handling, and storage tariff to cover operating,
                 maintenance and debt service costs. To operate the facility in the cocoa trade would not appear
                 to make financial sense.

                                                                 V-2

                                                                Pennsylvania Department of Environmental Protection

                                                                                 Rachel Carson State office Building
                                                                                                   P.O. Box 8555
                                                                                        Harrisburg, PA 17105-8555
                                                                                                January 11, 1996

                                                                                                                                                    717-787-2529
                  Bureau of Land and Water Conservation

                  Neil K. Christerson, Program Specialist
                  Coastal Programs Division - OCRM
                  SSMC4, Room 11209 (N/ORM 3)
                  1305 East-West Highway
                  Silver Spring, MD 20910

                  RE: DEP File No. CZ1:A(94)

                  Dear Neil:

                           Enclosed with this letter are two copies of the final report for the Piers 38/40 Reuse Plan
                  (94PS.02). This project was completed with funds provided by a financial assistance award in
                  the Coastal Zone Management Program for the fiscal year 1994.

                                                                                                   Sincerely,

                                                                                                   Robert S. Edwards
                                                                                                   Environmental Planner Il
                                                                                                   Division of Coastal Programs

                  Enclosure

                                                                                                                                        Illy

                  An Equal Opportunity/Affirmative Action Employer                    http://wwwdep.state.pa.us                           Printed on Recycled Paper Q9

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