Seaborne Airlines announced Wednesday it has reached agreement with the Commonwealth of Puerto Rico to relocate its corporate headquarters from St. Croix in the U.S. Virgin Islands to San Juan as part of a multi-faceted arrangement that calls for a $16 million investment from the government, officials announced Wednesday.
Under the agreement, the government will provide the incentive that includes $9 million from the Economic Development Bank, which becomes a minority shareholder with a 20 percent stake in the operation and two seats on the board of Seaborne’s parent company, Coastal International Airways, company officials explained.
Seaborne Airlines has committed to creating 400 jobs in Puerto Rico, of which 150 will be added in the first quarter of 2014. The move is expected to be completed by March 2014, and also calls for rebranding of Seaborne’s San Juan-based operations, though no details were offered regarding what that entails.
“There is little that is more important to economic development than global air access,” said Seaborne President Gary Foss. “This agreement will strengthen Puerto Rico’s ties with the rest of the Caribbean and position Seaborne as being Puerto Rico’s favorite airline, for connecting customers from our partner carriers, or for customers traveling to or from Puerto Rico to neighboring islands.”
Seaborne operates as an American codeshare partner in select markets, and has interline connecting agreements with JetBlue Airways and soon with Delta Air Lines in San Juan.
“We happily welcome Seaborne Airlines’ relocation to Puerto Rico, with its new hub of operations in San Juan, and our new partnership with Coastal International Airways,” said Gov. Alejandro García-Padilla.
“This partnership is important for reconnecting Puerto Rico to the Caribbean islands and also is an investment in jobs, commerce, new business opportunities and economic development,” he said.
“We have, in a year, recuperated routes that were discontinued during recent years in the Caribbean and now we are strengthening our position as the main hub in the region and connection to the United States,” he said.
Seaborne’s business plan calls for investing more than $100 million in Puerto Rico, of which $35 million is earmarked for the acquisition of 12 new aircraft over the next three years. Seaborne anticipates having a fleet of 16 Saab 340B, 34-seat aircraft based in Puerto Rico.
Wednesday’s announcement is the latest development for Seaborne, which has been aggressively expanding its business out of the Luis Muñoz Marín International Airport in recent months. Next year, it will launch new routes to the Dominican Republic, St. Kitts and Nevis, and St. Maarten.
Furthermore, the Puerto Rico Tourism Company has vowed to work with Seaborne to create even more routes to continue recapturing and expanding connections throughout the Caribbean lost in recent years, partly due to the departure of American Eagle earlier this year.
The cumulative economic impact of Seaborne’s move is estimated at more than $85.8 million in 2015, the government said.