Interview with Alexander Gumbs, CEO, Port Saint Martin Group

24 Jun Interview with Alexander Gumbs, CEO, Port Saint Martin Group

Port Saint Martin Group of Companies is government owned, but covers a wide range of areas with port operations, yachting, real estate, cargo, cargo handling and more. Can you explain the company and its scope to our readers, please?

Port Saint Martin Group is indeed a government-owned entity, however, we manage our operations and strategies as a private company, so while the government is the ultimate shareholder, corporate governance is an arm’s-length approach. In this case the minister we correspond with is the Minister of Tourism Grisha Heliga Maarten

Port St Maarten is made up of 13 companies split across three business pillars. We have the cruise business pillar, we have the cargo business pillar, yachting and then we have what could be considered a fourth business pillar, but the underlying foundation support is real estate. As a company, we also own strategic properties throughout the country, where we have certain real estate ventures. Sint Maarten is considered the marquee port in the Eastern Caribbean, one of the leading ports in the world. I believe if you look globally we are the fifth or sixth in the world and third or fourth in the Caribbean. Port Miami is considered the cruise capital of the world and a large percentage of the cruise ships that come to Sint Maarten come from Miami as their home port.

We have had an average of more than a million cruise passengers over the years that was benchmarked to about 1.5 million, but then we had the black swan event of the pandemic and that disrupted the industry as a whole. Sint Maarten did not escape from that but we are well on our way towards a full recovery. By the end of 2024, we will welcome approximately 1.4 million cruise passengers and in 2025 that would go up to about 1.55 to 1.6 million cruise passengers which will take us fully back to pre-pandemic levels when it comes to the cruise business.

Looking at the cargo product, we are also a hub. Besides importing full containers to the destination, we are a hub and sub-hub for many neighbouring destinations such as Saint Kitts and Nevis, Antigua and Barbuda, Saba, Sint Eustatius and Anguilla. Over the years we’ve also invested significantly in our cargo product and overall, if you look at the three business pillars — cruise, cargo and yachting — we’re looking at the future.

How does the port ensure that it minimizes its carbon footprint as much as possible?

If you look at International Maritime Organization regulations and the maritime industry, there are a lot of carbon projects currently ongoing with some very strict deadlines in achieving these objectives and becoming carbon net zero.

From a cruise perspective, the industry has pledged to be carbon net zero by 2050. As a small destination, but a marquee destination that has strategic agreements with several cruise brands and the arrival of hundreds of cruise ships annually, we too as a company, in collaboration with government and other local stakeholders, are looking into how we can tap into renewable efforts and reduce our carbon emission footprint in the industry. From a yachting perspective, which is one of our business pillars, we have currently two large yachting slips.

Stakeholders definitely have a huge role to play in a green economy. One of the things cruise lines are looking at is being able to plug their vessels into the local grid once in port. For small destinations that poses a huge challenge. One cruise ship may require 7-8 megawatts, but if you have three or more ships in port, that can easily become 25-30 percent of the national grid.

The country is now looking at how we can sustainably get further into the green economy. Of course there’s a private public partnerships approach but the local citizens also have their role to play in that regard in terms of further elevating the country into those initiatives. From a port standpoint, we have invested into solar. We’re looking at further electrifying the cars that we use. Some of the US ports have gone as far as electrifying their cranes and their cargo equipment. We have not reached that point yet. We just purchased a new crane back in 2023 and that is very conservative in terms of carbon emissions. We are on the path, but there’s still work to be done.

Can you explain your upgrade plans and tell us about the investment opportunities in this case? Is there any room for investors coming from the Miami area?

We have an extensive investment plan laid out over the coming seven years. We plan to invest north of $65 million into investments and infrastructure in the port, but also in the surrounding areas where we own properties. Passengers on average have been here at least three times so that also puts a beautiful challenge to the destination to continue to reinvest and reinvent itself and to further showcase the opportunities of other inland experiences. Showing the diversity of the country’s Dutch and French heritage, but also the array of tours, restaurants and other opportunities including hiking trails, exploring the beaches and the waters. That is very important from the port standpoint.

We fully welcome and endorse opportunities from Florida, as we have phenomenal relationships with the various cruise brands in their headquarters, which are mostly in Miami. Currently, we have strategic agreements with Carnival Corporation and Royal Caribbean. Over the years, we’ve co-invested in various projects and there are discussions in progress about future projects. Of course, as a company we look at how to widen that investment pool and are actively engaging with other cruise brands that may be interested in not only investing in the port but in products and the country at large.

Port Saint Martin group anticipates 1.5 million cruise ship passengers in 2025. Can you explain your facilities and attractions for cruise passengers? What makes you unique?

Sint Maarten is seen not only as a cuisine capital of the Caribbean, but also great entertainment. I think the match of those two concepts makes a perfect multicultural blend of a country being tax free, having more than 100 tours available, having 37 beaches on 37 square miles, being split between French and Dutch. Visitors can come in on a cruise ship, take a ferry in the morning to St. Bartholomew, have an experience in St. Bart, return to Sint Maarten to board the ship again and do the same in Anguilla.

I think the value proposition of Sint Maarten is unmatched. If you look at the hospitality and friendliness of the people and the sheer free feel of exploring the country with an open border to the front side, I think that definitely gives us the competitive edge as a Caribbean destination. Another reason Sint Maarten has been successful is the shopping experience, downtown and also in Marigold. You also have shopping opportunities here in the port where prices are cheaper and are competitive with the U.S. mainland.

Over the last five years, we’ve also seen a further shift of persons wanting more tour experiences and venturing further into the country, which is beautiful that they are now experiencing new things. In Sint Maarten, we have a very vibrant private business sector that has been continuously reinvesting into their products. We have new tour buses on the roads, new taxis, so those entrepreneurs are also very much investing in their product, sustaining that quality delivery and hospitality to guests.

The Simpson Bay Lagoon is one of the largest island lagoons in the West Indies and is very popular for yachting. How do you assess the popularity of Sint Maarten with private vessels with very high net worth individuals?

Tying into the attractiveness of Sint Maarten from the yachting perspective, we have a comprehensive maritime industry here, so whether it’s off season or high season for yachts, if there’s work to be done, we have a lot of skilled maritime professionals in the Simpson Bay area. From a fabrication or mechanical and electrical standpoint, those services are readily available here at good prices. What is also very important for the yachting industry is the ability to be able to provision the yachts. Many of the yachts that spend the season here are charter yachts, so every week or every two weeks they will return and provision a yacht and then take a new group out on vacation. That provisioning component is very important and that ties into our cargo, product and efficiencies in being able to get those containers of goods from the U.S. source markets.

From a Sint Maarten perspective, there are several large wholesalers that have agreements with the yachts in terms of provisioning. The yachting sector is at the pinnacle of luxury and they’re also very keen on the type and quality of the products. I think that delivery and services here that are offered by the wholesalers anchor the yachts here.

A third point that also makes Sint Maarten very popular as a yachting destination is its proximity to Saint Barts. All the yachts are coming to Sint Maarten and preparing for their charter guests and our owners to spend the holiday season in Saint Barts. So that proximity further adds to Sint Maarten’s hub position in having yachts stationed here in preparation for charter guests and or owners of the yachts. A fourth point that ties in directly to the success of this business is the functionality, efficiency and innovation of the airport. Many of the charter guests and our owners fly in with their private jets to the Sint Maarten airport, so that also forms a very important pin to the success of the yachting industry.

On October 30th, the Florida Caribbean Cruise Association cruise conference and trade show took place here. Can you outline some of the key takeaways, unexpected achievements and announcements you will be able to make as a result of the conference?

The conference was an enormous success. We welcomed around 800 people to the country for the conference, including almost 100 cruise executives and leaders of governments from various Caribbean countries. From the U.S. we had the CEO of Margaritaville at Sea; the CEO and president of Royal Caribbean International, Michael Bailey; the president of Princess Cruises, John Paget; the CEO of Norwegian Corporation Harry Sommer and various other key stakeholders here at the conference. You also had representation from Port Miami as well that attended the conference on St. Maarten.

We had 800 people that spent three to four nights on the island, adding a significant room night stay. Besides some also rented private vehicles, had private dinners and also some of whom may have stayed at Airbnbs, so they made a great economic impact on the country. Those 100 cruise executives had the opportunity to see firsthand what their passengers are experiencing here on our beautiful island, what type of services we have to offer, the level of hospitality, the level and type of dining opportunities, the culture, so for them it was a great opportunity to look at the firsthand rebuild of the country and hear from government leaders where the strategic vision is for Sint Maarten and Port Saint Martin. There’s also the marketing impact which is sometimes difficult to measure, but we know we had lots of exposure through these 800 persons on their social platforms and those who had articles written based on their successes. Many of the executives and delegates came with additional family members. So that 800 could have easily been 1100, 1200 people, if you think about people coming in with their kids for a pre- or post-vacation stay as well.

During the three days, there were more than 800 meetings scheduled so it was a jam-packed agenda, with workshops and seminars and the presidents and CEOs panel discussion. I moderated that panel and it was the first time in the history of the conference that a destination representative carried and moderated that panel discussion.

What is your final message for the readers of Sint Maarten and invite them to come and invest and enjoy your beautiful country?

We have a remarkable product. We have amazing connectivity with the U.S. source markets, we have great hotels and experiences. I do think that Sint Maarten is still, to an extent, very much unknown to the wider masses and I see opportunities there. From an investment standpoint, I think we have a very open climate and there is also a strategic agreement through the Netherlands where Americans can come in and make investments. So it’s a very appetizing market at low interest rates through the current local banking financiers, relatively easy processes in establishing a business and looking at further investing in making the country even greater than it is right now.

For me it’s important that we continue to look at our port facilities and enhance our product that we offer here. In our facilities, it’s looking at the connectivity via airlift, via ferry and our connectivity as a hub to the various other Caribbean destinations, looking at sustainability, which is quite high on the list from our international stakeholders.

Last but not least, the overall offering and experience on St. Maarten. Those points are of utmost importance for us as a port, tying into our three or four business pillars that line the path to further success in the future.