Hanwha is leasing another 47 acres at the Navy Yard
The shipbuilder is leasing additional room to grow as it aims for profits in its South Philly shipyard.
Hanwha Philly Shipyard has agreed to lease more space at the Navy Yard, adding 47 acres across several properties around the western Reserve Basin.
The company already has 110 acres of facilities in the former Navy complex since buying Philly Shipyard from Aker for $100 million in 2024.
The new property will give Hanwha additional locations to make good on its 2025 pledge to invest $5 billion in new docks, cranes, and shipbuilding facilities and hire thousands more workers. That’s all intended to help Hanwha build more ships to turn the money-losing yard profitable.
“It’s about throughput, getting more ships out the door per year, and having the capacity to expand to meet our customer’s future demand,” a Hanwha spokesperson said in a statement Wednesday.
The 47-year-and-8 month lease, with the option of renewal or purchase at its end, was approved by the Philadelphia Authority for Industrial Development (PAID) at its meeting Tuesday. PAID is managed by the Philadelphia Industrial Development Corp., a partnership of the city and the regional chamber of commerce.
Hanwha employs close to 2,000 full-time workers at the yard and “intends to grow its Philadelphia workforce, adding up to 5,000 full-time employees” with its new investment, according to a PAID resolution authorizing the lease.
“PIDC has been working closely with Hanwha to support its historic investment in Philadelphia, and this lease represents the next formal step,” PIDC spokesperson Kevin Lessard said in a statement. “It puts nearly 50 acres of Navy Yard land to work for shipbuilding and quality jobs, while we continue investing in the infrastructure that helps every company at the Navy Yard grow.”
Philadelphia maritime manufacturers including Hanwha expect to need thousands more workers as the U.S. expands Navy shipbuilding contracts and subsidizes private shipbuilding in competition with China’s navy and world-leading commercial shipyards. The companies have turned to community colleges, metal-trades union apprenticeship programs, and nonprofits to help train these recruits.
The Navy Yard properties Hanwha is adding to its footprint include open ground or World War II-era structures that could be demolished and replaced with construction structures, improved piers, parking, and other facilities. Hanwha also plans to move its offices east to the former FS Investments building in the office section of the former naval base.
The new lease includes:
The 28-acre former Navy storage and disposal property under the east bank of the Girard Point Bridge
The marine-railway property and Building 646 on 5.5 acres connecting Hanwha’s main shipyard area to the waterfront
The 5.4-acre field between the southwest tip of Hanwha’s current shipyard and the 28th Street bridge
The 2-acre property including the former Navy Yard steam plant, Building 23, east of Hanwha’s current shipyard offices
A 5.2-acre property including Building 120, formerly a Navy archive, and Building 613, a battery facility, on Langley Avenue north of the Reserve Basin
The 1.5-acre water-tower property at 2001 Constitution Ave. near the current Hanwha shipyard gate.
Rent will be calculated from an initial $4,500 per acre per month, or around $214,000 a month total, rising 2.5% per year, plus taxes and Navy Yard district maintenance expenses. The rent won’t be charged for the first 2½ years.
Hanwha’s properties are interspersed with lots occupied by Rhoads Industries, whose several hundred workers repair ships and build modules for General Dynamics’ Navy nuclear submarines, and which plans to double employment over the next several years. Also occupying parts of the area is the Navy itself, still the neighborhood’s largest employer with over 4,000 civilian and military staff in its offices, propeller foundry, and testing facilities.
Hanwha is currently building the last of five training vessels for the U.S. Maritime Administration and has advanced work on the first of three Aloha-class container ships for the Matson cargo lines that will travel between U.S. Pacific ports and China.
Hanwha has agreed to construct two additional radar-tracking ships for the U.S. government. And the company is pursuing other contracts that could double the yard’s workforce of around 2,500, according to Hanwha officials.
Hanwha has also said it will be ready to build civilian commercial ships in Philadelphia as it seeks to make the yard profitable. The company says it can increase its construction rate to more than 10 ships a year, as it currently builds no more than two per year.
