My wife and I just came back from a 7 day cruise from Seward Alaska to Vancouver in Canada. One of the stops was a port of call created specifically for the cruising industry called Icy Strait Point. This port is built into the side of an island off the coast of Alaska. Most people on the ship would have enjoyed the fresh cooked salmon, and marvelled at the numerous souvenir shops sprinkled throughout this manufactured village. I on the other hand looked at it through the lens of a real estate investment.
Cruise lines are often looking for ports that charge low landing fees. These fees amount to huge sums over time. That’s why each major cruise line has built their own beach club at a private island in the Bahamas. They get a day at the beach with no port fees or landing fees.
The investment structure for Icy Strait Point is a unique partnership where the Huna Totem Corporation, an Alaska Native village corporation, maintains full ownership and operational control, while major cruise lines act as key investors. This model allows the native corporation to retain sovereignty while securing the capital needed for port development.
The investment came primarily from NCL and Royal Caribbean which gives these cruise lines preferential access to the port.
Icy Strait Point is fully owned and operated by the Huna Totem Corporation, which represents more than 1,550 Alaska Native shareholders. All profits from the port are reinvested back into the community of Hoonah.
When you travel, don't just eat the fish and buy a t-shirt, look behind the curtain at the investment structure.
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