PORT AUTHORITY 2020 ANNUAL REPORT

Resilient TO DAY. Stronger TOMORROW. MOVING FROM Disruptive Crisis TO Meaningful Change

Massport’s ability to adapt to the changing tides has allowed us to navigate an evolving health pandemic and economic crisis while not losing sight of our mission to support the economy and our communities. This year’s annual report cover represents Massport’s role in cargo and air freight operations, bringing health and safety supplies and commercial goods to the Commonwealth and the region. MASSACHUSETTS PORT AUTHORITY 2020 ANNUAL REPORT

THE MASSPORT MISSION

A world-class organization of people moving people and goods—connecting

Massachusetts and New England to the world safely, securely, and efficiently,

with a commitment to sustainability, our neighboring communities, and diversity,

equity, and inclusion.

SEC Disclaimer

Information that may be of interest to holders of bonds or notes issued by the Massachusetts Port Authority are presented in this report for general informational purposes only and are provided without warranty of any kind and, in particular, no representation or warranty, express or implied, is made or is to be inferred as to the accuracy, reliability, timeliness or completeness of any such information. The information set forth in this annual report is limited in scope and does not contain all material information concerning the Authority necessary to make an informed investment decision. This annual report addresses only the matters discussed therein, is dated as of a certain date and has not been updated since that date and, as a result, may not address all factors that may be material to an investor and may contain material misstatements or omissions of fact because of the passage of time or changes in facts or circumstances subsequent to the date of such document. Consequently, no person should make any investment decision in reliance upon the information contained in this annual report.

UNDER NO CIRCUMSTANCES SHALL THE INFORMATION IN THIS REPORT CONSTITUTE AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO SELL OR BUY ANY SECURITIES. OFFERS TO PURCHASE THE AUTHORITY’S BONDS OR NOTES MAY ONLY BE MADE THROUGH A REGISTERED BROKER-DEALER AND THROUGH AN OFFICIAL STATEMENT.

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TABLE OF CONTENTS

A MESSAGE FROM LEWIS EVANGELIDIS AND . . . . . 3

SAFETY, HEALTH AND SECURITY ...... 4

AVIATION ...... 6

Boston Logan ...... 6

Worcester Regional Airport ...... 11

Hanscom Field ...... 12

MARITIME ...... 13

Conley Terminal ...... 14

Flynn Cruiseport ...... 16

REAL ESTATE AND ASSET MANAGEMENT ...... 17

MASSPORT IN THE COMMUNITY ...... 21

DIVERSITY, EQUITY, AND INCLUSION ...... 24

SUSTAINABILITY AND RESILIENCE ...... 25

FISCAL RESPONSIBILITY ...... 26

SENIOR STAFF ...... 28

BOARD OF DIRECTORS ...... 29

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A MESSAGE FROM LEWIS EVANGELIDIS AND LISA WIELAND

When 2020 began, we had extremely high expectations for the year ahead. We were experiencing record growth at Boston Logan International Airport, Conley Terminal, Flynn Cruiseport Boston, and Worcester Regional Airport. Then the pandemic hit. The world shifted dramatically and shook our sense of normalcy. But we didn’t stop. We pivoted. We adapted.

The year was unlike any in Massport’s history. In a matter of days, the coronavirus turned into a global public health crisis impacting our families, communities, and every aspect of our operations. We saw significantly fewer planes in the sky and ships in the water; we saw empty terminals and restaurants in hibernation; we saw office spaces and hotel rooms in the dark; and the once-bustling streets of Boston were quiet. These new norms forced us to be nimble and to think creatively about how we carry out our mission.

LEWIS EVANGELIDIS Working as One Massport, we navigated through the challenges and developed solutions dedicated to keeping our customers Chairman of the Board and staff safe and secure, while remaining committed to supporting the local economy, our surrounding neighborhoods, and the Sheriff of Worcester County environment. The actions we’ve taken lay the foundation for a stronger future.

• We cut expenses and put together a sustainable financial plan;

• We collaborated with state, local, and federal partners to quickly develop safety and health protocols and adopted touchless technology throughout our facilities;

• We supported the Commonwealth’s efforts to bring personal protective equipment (PPE) to health care and frontline workers;

• We provided support to our airport and maritime tenants to help them get through this difficult economic time;

LISA WIELAND • We provided summer jobs and scholarship opportunities for students and maintained our charitable giving programs to help Chief Executive Officer our neighboring communities in time of financial challenges;

• We invested our resources to create a more agile organization and leveraged innovation and technology to drive greater efficiencies; and

• We strategically prioritized several critical infrastructure improvement projects to prepare our airports and the working port for the economic rebound.

As vaccines become more available, businesses reopen, and travel restrictions are eased, we look to better days ahead with a continued primary focus on safety, health and security as well as a renewed focus on the customer experience, sustainability, diversity, equity and inclusion, and advancements in technology and the way we operate. At Massport, we are reminded that overcoming hard times is what builds resilience. And recovering from life’s biggest challenges helps chart the course for a brighter tomorrow.

Lewis Evangelidis Lisa Wieland

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SAFETY, HEALTH AND SECURITY

The unprecedented events of 2020 challenged important role in limiting the spread of the virus Massport like no other and demonstrated why in the community. our commitment to safety, health and security is Massport quickly implemented remote work more vital now than ever before. Whether it was options for administrative staff, made changes responding to the global COVID-19 pandemic; to allow social distancing, and stepped up ensuring the safety of our employees, disinfectant cleaning throughout all our passengers, and facilities; or strengthening facilities. All passengers were required to wear our cybersecurity and business continuity face masks in the terminals to comply with capabilities, Massport remained resilient. the Commonwealth of Massachusetts’ mask mandate. Personal protective equipment was PANDEMIC RESPONSE secured for all employees to reduce the spread of the virus among the workforce. We developed In partnership with the federal Centers for a comprehensive COVID-19 screening program Disease Control and Prevention (CDC) and for construction workers to allow essential Enhanced cleaning procedures in response to COVID-19. state and local public health agencies, we projects to proceed while avoiding outbreaks. updated our pandemic response plan in real All Massport team members performed time as medical experts learned more about personal health assessments before reporting Massport quickly implemented the coronavirus. Our contact tracing efforts to the workplace. We also performed internal remote work options for administrative not only focused on the safety of all of our contact tracing for employees possibly exposed passengers and employees, but also played an staff, made changes to allow social to the virus. distancing, and stepped up disinfectant cleaning throughout all our facilities.

Terminal signage to encourage handwashing, social distancing, and mandatory face coverings. Our IT professionals quickly transitioned hundreds of employees to remote work, ensuring that critical functions continued uninterrupted. They also had to respond to the increased threat of cyberattacks, as criminal actors increased their efforts to capitalize on the vulnerabilities presented by extensive remote work. Massport enhanced our cyber incident response capabilities, strengthened our email and workstation security solutions, and coordinated with federal partners to obtain the most up-to-date cyber intelligence.

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During the crisis, Massport reinforced our Massport was also engaged on other fronts of relationship with the Massachusetts Emergency safety, health and security throughout 2020. Management Agency (MEMA), deploying staff During periods of public demonstrations, to the MEMA Emergency Operations Center Massport Police and MSP Troop F patrolled and warehouse to assist the Commonwealth our parks and facilities to ensure that our in its efforts to distribute PPE. community members were able to exercise their right to assemble in a safe environment. We also developed new online employee training MANAGING OTHER RISKS on protecting sensitive information, partnered In addition to our pandemic efforts, Massport with the Federal Aviation Administration (FAA) continued to ensure that first responders were and other policy makers on a drone safety well prepared to protect the safety, health campaign, and advocated for greater aviation and security of the public and our assets. In security in testimony at a U.S. Senate hearing.

early 2020, Massachusetts State Police (MSP), Drone safety campaign. Massport Fire Rescue, and mutual-aid partners engaged in live-action training with a simulated active-shooter event at Worcester Regional Despite the multiple challenges Airport. Massport employees produced we faced in 2020, our efforts across an active-shooter training video for law numerous fronts ensured that enforcement, and our security team partnered Massport was able to operate with the Department of Homeland Security effectively, safely, and seamlessly, and to conduct onsite assessments of Worcester Regional Airport and . remains well prepared for the future.

PPE delivered and distributed at Boston Logan International Massport employees participated in a hurricane preparedness Airport in response to the COVID-19 pandemic. tabletop exercise on October 1, 2020.

Massachusetts State Police, Massport Fire Rescue, and mutual-aid partners engage in live-action training at Worcester Regional Airport in early 2020.

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AVIATION

Boston Logan CRISIS RESPONSE Boston Logan International Airport served In March 2020, Massport collaborated a record 42.5 million passengers in 2019 with our federal and state partners at the and was headed for another record year, as CDC, Massachusetts Department of Public passenger activity in January and February Health, Boston Public Health, Boston EMS, U.S. Department of Homeland Security, U.S. 2020 grew by more than 7%. However, as the Governor Baker addresses media following the arrival of global pandemic intensified in March 2020 Customs and Border Protection (CBP), and much-needed PEE equipment for the Commonwealth’s and governments imposed travel restrictions other organizations to prepare Boston Logan essential workers. and stay-at-home orders, passenger activity to serve as one of the 15 U.S. funnel airports for began declining sharply. By April 2020, traveler international arriving passengers from China, activity at Boston Logan had fallen by an certain European nations, and other designated Massport served a critical role in the delivery astonishing 97%. Although a limited recovery countries. These passengers were required of PPE supplies for health care and frontline began to take shape over the summer of 2020, to undergo enhanced health screenings at workers. In spring 2020, we collaborated Boston Logan’s domestic passenger volume the funnel airports to safeguard against virus with airlines, MEMA, and other relief efforts in December was down by 75%. Lockdowns transmission in the U.S. Massport constructed to coordinate cargo flights that delivered in other countries and closed borders caused a secondary health screening area in Terminal E much-needed PPE through Boston Logan even steeper declines in international travel, to assist with the CDC’s efforts. International Airport and Hanscom Field. In which was down 82% at the end of 2020. April 2020, we supported arrival logistics for the New England Patriots plane that landed at Boston Logan with a special delivery of one million N95 masks for the Commonwealth’s essential workers. The Kraft family donated the Patriots plane to deliver critical PPE supplies for the Commonwealth.

FOCUS ON HEALTH AND SAFETY Relying on CDC and World Health Organization (WHO) guidance, Massport acted quickly to create a clean and healthy airport environment for passengers and airport workers. A four-point plan for our airport facilities was developed to (1) maximize hygiene with frequent, visible, and intensive cleaning practices; (2) ensure that passengers and employees adhered to Governor Baker’s mask mandate; (3) leverage and expand existing

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technologies to create a touchless passenger journey; and (4) maintain social distancing by installing 6-foot separation markers in check- in areas, passenger seating at gates, and throughout our airports. In August 2020, Boston Logan became the first North American airport to receive the Airports Council International’s (ACI) Airport Health Accreditation. This accreditation reassured passengers and airport workers that Massport prioritized their health and safety by following industry-established guidelines for air travel during the pandemic. As the pandemic progressed, Massport worked Boston Logan quickly installed signage encouraging social distancing, handwashing and face coverings. with MarketPlace, the concession management company at Boston Logan, to bring COVID-19 testing sites to the airport. A modular facility Social distancing markers placed at baggage claim areas and check-in counters to help stop the spread of COVID-19. with seven separate testing rooms and a waiting area was constructed in Terminal E. In October 2020, the XpresCheck™ testing site opened to passengers and employees, offering rapid molecular COVID-19 tests, polymerase chain reaction (PCR) tests, and blood antibody tests.

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INFRASTRUCTURE IMPROVEMENTS Despite the impacts of COVID-19 on business activity and finances, Massport continued to advance key strategic and safety initiatives at airport facilities, knowing that air travel would be essential to economic recovery.

Boston Logan Airport Runway 9/27 Rehabilitation We took advantage of low activity and federal funds made available through the Coronavirus Aid, Relief, and Economic Security (CARES) Act to accelerate the repaving of Runway 9/27, a major runway that handles 30% to 50% of Boston Logan’s departures. In addition to pavement repairs, the project improved

the runway’s drainage and installed new energy- A FedEx plane waiting to take off into the sunset. efficient LED edge and centerline lights. The project began three months earlier than originally planned and was completed in early August 2020, reducing community overflights and minimizing disruptions Topping-off ceremony at the B-to-C Connector project, which will create a post-security connection between the two terminals with additional food and retail concessions. to the traveling public.

Terminal B-to-C Connector The Terminal B-to-C Connector project, designed to enhance the passenger experience and provide operational flexibility, continued to advance in 2020. Once completed, this project will create a new post-security connection between Boston Logan’s two busiest terminals, helping passengers to make seamless flight connections. This initiative also includes renovations and enhancements to Terminal C, such as expanded food and retail concessions, a new aircraft gate, and space for a new full-service passenger lounge. In passenger waiting areas with an easterly exposure, special glass will be installed in the windows

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facing the airside. The glass automatically tints the windows to shield passengers from the glare of the morning sun and reduces the need for air conditioning, making the terminal more energy efficient. The Terminal B-to-C Connector project is expected to be completed in 2022.

Terminal B-to-C Roadways Massport also took advantage of historically low passenger volumes to complete major portions of the Terminal B-to-C Roadway project that will replace roadways constructed in the 1970s. This section of roadways was redesigned to eliminate congestion, especially when exiting Terminal B at peak times. Taking advantage of the low Rendering of improved traffic flow outside Terminal C as a result of the Terminal B-to-C Roadways project. traffic volumes, workers were able to install a prefabricated bridge section in a single weekend, minimizing disruptions to passengers.

Terminal C Departures Level Canopy Significant progress has been made on the Terminal C Departures Level Canopy project, which will improve the arriving and departing experiences for Terminal C passengers. When completed, the new canopy will provide enhanced weather protection and more natural light at the curb. The new canopy will feature a solar panel capable of generating enough energy to power 12 homes. The project will also expand the curb areas with new LED lighting on the arrivals level and improved signage for better passenger access and egress. In 2020, three new curbside elevators were installed, a temporary departures level roadway entrance was opened, and the old canopy was demolished. Architectural rendering of the future Terminal C Departures Level Canopy project, which will provide weather protection and more natural sunlight at the curb when completed.

9 Terminal E Modernization Before the pandemic, Boston Logan’s international passengers grew 10% annually from 2012–2019, twice as fast as domestic passengers. The Terminal E Modernization project is designed to address overcrowding by adding seven new aircraft gates while renovating and reconfiguring existing spaces for more efficient operations. With the steep drop-off in international activity due to COVID-19 and the uncertainty around the recovery of international travel, Massport strategically decided to proceed with four of the seven planned gates. The project will feature a new Great Hall for concessions and other passenger amenities, upgrades to the CBP area, expanded baggage carousels, and new airline club spaces. By the end of 2020, the roof of the existing terminal and the arrivals level canopy had been repaired, upgrades to the electrical service and fueling system were completed, and the steel structure and concrete decking were underway. The project is expected to be completed in 2023.

Rendering of future Terminal E at dusk.

The Terminal E Modernization project will add four new gates, a new Great Hall for concessions, and other amenities for international passengers. 10 MASSACHUSETTS PORT AUTHORITY 2020 ANNUAL REPORT

The momentum that was building at Worcester Regional Airport Worcester Regional Airport was interrupted by the pandemic. Worcester Regional Airport serves the City of Worcester, the second largest city in New England, and the Central Massachusetts region. The airport is a critical asset for connecting local Massport took advantage of reduced passenger businesses to growth opportunities, attracting activity during the pandemic and available FAA a large labor force, and supporting the area’s funding to resurface half of the airport’s primary burgeoning tourism industry. Under Massport’s runway and install energy-efficient LED runway stewardship, the economic output of Worcester signs without major disruptions to airlines Regional Airport more than doubled over five or passengers. years to $97 million, an increase that was driven Worcester Regional Airport remains a critical by new airline services and over $100 million pillar of economic development for Central worth of investments made by Massport and Massachusetts and an important reliever airport private investors. American Airlines, JetBlue and Delta aircrafts at in New England’s regional airport system. Worcester Regional Airport in early 2020. Worcester Regional Airport was undergoing Looking forward, Massport will continue to work a steady resurgence, attracting new airlines, with our partners and stakeholders to support adding new destinations, and growing its commercial service restoration and explore other passenger base to more than 200,000 in 2019. opportunities at Worcester Regional Airport. The airport’s newest services, which included JetBlue to New York JFK, American Airlines to Philadelphia, and Delta Air Lines to Detroit, were still developing and passenger demand was growing in early 2020. The momentum that was building at Worcester Regional Airport was interrupted by the pandemic, and by October 1, 2020, all airline services at the airport were suspended pending a recovery of air travel demand.

Similar to Boston Logan, Massport continued to invest in critical infrastructure projects at Runway 11-29 resurfacing project. Worcester Regional Airport to position it for a strong rebound when air travel resumes. Lieutenant Governor Karyn Polito and Congressman James McGovern show their continued support of Worcester Regional Airport during the 11-29 runway resurfacing virtual celebration in September 2020.

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Hanscom Field Hanscom Field, the region’s premier full-service Hanscom played a vital role in the PPE general aviation airport, plays a critical role in the distribution efforts early in the COVID-19 region’s airport system as a corporate reliever pandemic. In spring 2020, 16 flights arriving for Boston Logan. Aircraft activity at Hanscom at Hanscom Field delivered over 70,000 face includes air taxi, private business and personal shields for Massachusetts health care workers. aviation, charter, cargo, medical, military, and All of the pilots involved volunteered their flight school operations. The airport serves the aircraft and time through the Angel Flight diverse flying needs of businesses, professional organization. MEMA was an active partner and college sports teams, and recreational pilots. helping to distribute the PPE to end users. It is also an important resource for Hanscom Air Three first-class fixed-base operators (FBOs) Force Base, a research and development facility provide flight support services for business and adjacent to the airfield. In 2017, Hanscom Field private aircraft at Hanscom, including aircraft generated $679 million in economic benefits for refueling; maintenance, repair, and overhaul; the Commonwealth and supported over 2,200 aircraft storage; passenger services; and flight full-time jobs. crew lounges. Ross Rectrix, one of the FBOs, The pandemic reduced activity levels at will invest nearly $20 million for 60,000 square Hanscom Field, but not as severely as the feet of new corporate hangars and associated reductions seen at Boston Logan and Worcester aprons. Another FBO, Signature Flight Support, Regional Airport. In 2020, Hanscom handled will invest nearly $20 million for a new facility, Angel Flights helping to deliver PPE supplies at increased apron space, and major upgrades to Hanscom Field. 99,725 aircraft operations, a 23% decrease compared to 2019. five hangars starting in 2021.

The U.S. Air Force arrives at Hanscom Field to deliver PPE to the Commonwealth.

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MARITIME

ECONOMIC ENGINE 2020 was a year of progress for Massport’s maritime facilities, reaching new milestones in the delivery of strategic capital investments that support the future of the working . Serving 14 million consumers, the Port of Boston has become a flexible, efficient, and reliable gateway for New England. It was also a year of enormous challenges. Throughout the pandemic, port workers played a critical and essential role in serving the citizens and businesses of the Commonwealth by moving home and health products when they were needed most.

The Port of Boston is a strategic regional gateway, servicing the New England economy through international trade and cruise tourism. Container shipments through Conley Terminal, cruise ships arriving at Flynn Cruiseport Boston, automobiles handled at the Boston Autoport, seafood processing and distribution at the Fish Pier and Massport Marine Terminal (MMT), and activity at private marine terminals produce $8.2 billion in total economic benefits for the Commonwealth annually. Port of Boston activities directly support 9,000 jobs including truckers, stevedores, freight forwarders, tugboat operators, pilots, ships’ agents, and seafood workers.

A large Evergreen ship docked at Conley Container Terminal.

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Conley Terminal

In 2020, Conley Terminal handled 268,000 twenty-foot equivalent units (TEUs). The COVID-19 pandemic heavily impacted container traffic through the Port in the second quarter, as the effects of factory shutdowns in Asia were compounded by stay-at-home orders in Massachusetts. Business began a slow recovery throughout the remainder of the year, finishing better than expected at just 11% behind 2019. Demand for “at home” products and PPE fueled the recovery as New England consumers worked and attended school remotely and established new purchasing habits. Residual impacts from trade tariffs imposed in 2019 left regulatory Crews work to bring cargo containers burdens on commodities moving between Asia, in and out of the Port of Boston. Europe, and New England throughout 2020. Some commodities affected by these policy shifts, such as waste paper, found new markets in West Central and Southeast Asia.

trade to Southeast Asia in 2020 drove an 8.8% Demand for “at home” products increase in imports on the North Europe to and PPE fueled the recovery as Boston service, which connects shipments New England consumers worked from Southeast Asia through Belgium and then and attended school remotely and on to Massachusetts. established new purchasing habits. Conley Terminal serves over 2,500 New England businesses that utilize the Port’s two weekly services: Mediterranean Shipping Company’s China continues to be Conley Terminal’s largest (MSC) direct service from North Europe to source for imports, but New England retailers Boston, with connections to Latin America, are intentionally diversifying sourcing strategies the Mediterranean, and Southeast Asia, and abroad, expanding Conley’s trade portfolio into the OCEAN Alliance’s (Cosco Shipping, OOCL, An MSC ship docked at port while containers are offloaded. Southeast Asian countries such as Vietnam, Evergreen, CMA CGM) weekly direct service India, and Pakistan. This continuous shift of from Asia.

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EXPANSION AND MODERNIZATION ON COURSE TO BECOMING BIG SHIP READY

Boston Harbor Deepening Massport, as the local sponsor, is working closely with the U.S. Army Corps of Engineers (USACE) on the Deep Draft Navigation Improvement Project to ensure Conley Terminal’s continued growth and competitiveness as an East Coast gateway. Phase 2 of the Harbor Deepening project, which included deepening the main ship channel to 47 feet and expanding the turning basin to 1,725 feet, was completed in 2020. In the process, 11.4 million cubic yards of silt, blue clay, till, and weathered rock material were removed from the harbor floor. In the wake of the pandemic, the dredging crews implemented unique safety protocols to ensure that 24/7 work could continue, keeping the project on schedule.

Phase 2 of the Boston Harbor Deepening project was completed in 2020. Berth 10/Cranes The Conley Terminal Berth 10 and crane project is well underway, with an expected completion in fall 2021. This project will allow Conley Terminal to efficiently service the 13,000–14,000 twenty-foot equivalent unit (TEU) vessels that call on U.S. East Coast ports today. Berth 10, a new 50-foot-deep berth contiguous with existing Berths 11 and 12, was completed in 2020. This new deepwater berth will allow Conley Terminal to service bigger ships using taller cranes. In summer 2021, three low- profile Neopanamax ship-to-shore cranes are expected to be delivered to begin their commissioning onsite in the Port of Boston. Two of the cranes are the tallest low- profile cranes in the world at 205 feet tall with a lifting height of 160 feet and can reach 22 container rows wide.

Berth 10, a new 50-foot-deep berth, was completed in 2020.

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Flynn Cruiseport Boston In a typical year, cruise activity at Flynn Cruiseport Boston contributes more than $130 million to the local economy and supports more than 1,000 direct jobs. The COVID-19 pandemic completely halted cruises from U.S. ports in 2020. The CDC issued a “No Sail Order” in March 2020 that prohibited ships from sailing from U.S. ports with passengers. As a result, Flynn Cruiseport Boston had no cruise ship Flynn Cruiseport Boston hosted Red Cross activity for the entire 2020 cruise season. blood drives. The cruise terminal was repurposed during the 2020 cruise season for uses that were conducive to the needs of the pandemic. The Flynn Cruiseport Boston team partnered with the Red Cross to host, promote, and assist with blood drives in an effort to solicit much-needed blood donations. Additionally, as many indoor exercise studios were unable to reopen, The Handle Bar, a Boston-based fitness group, began hosting socially distanced fitness classes on the premises. The cruise facility was also used to host large virtual events. The year 2020 also saw a partnership between Massport and the Boston Planning & Development Agency (BPDA) to make improvements to Black Falcon Avenue that will enhance the passenger experience when cruises resume. The roadway serves as a gateway to Flynn Cruiseport Boston, welcoming visitors and accommodating their ground transportation needs on arrival and departure. A flexible new design A spin studio takes over the reimagined Flynn Cruiseport Boston space during the COVID-19 pandemic. will allow both general traffic and high-volume cruise operations to coexist when cruise activity returns.

Recovery for the Port of Boston Key elements of the Conley Terminal Modernization project are expected to be delivered in third-quarter 2021. Berth 10 and the three new ship-to-shore cranes are expected to be operational, allowing the Port of Boston to more efficiently service the new generation of container ships calling on East Coast ports. A robust marketing campaign is also planned for launch in spring 2021 to raise awareness of the new capabilities of the Port and to attract new services enabled by the improvements. Flynn Cruiseport Boston will continue to work with federal and local authorities to ensure that the cruise industry recovery plan adequately balances the restart of cruise operations with the health and safety of passengers, employees, and citizens in the Commonwealth. 16 MASSACHUSETTS PORT AUTHORITY 2020 ANNUAL REPORT

REAL ESTATE AND ASSET MANAGEMENT

Massport owns and/or manages a diverse portfolio of commercial and maritime/industrial real estate assets in East Boston, , and Charlestown. Assets range from commercial office buildings, hotels, and apartment buildings to the , Massport Marine Terminal, and Boston Harbor Shipyard & Marina. Massport manages these assets through a mix of long- term ground leases and short-term space rentals and licenses, with the fundamental objective to support Massport’s core mission by:

• Protecting and enhancing our aviation and maritime businesses;

• Maximizing the value of Massport-owned land to support and subsidize maritime needs;

• Enhancing economic development for the Commonwealth through job creation and tax revenues;

• Adding to the public realm of the area and connecting the public to natural assets;

• Making diversity, equity, and inclusion a priority for all development projects; and

• Advancing Boston’s civic vision as a collaborative partner.

Omni Boston Hotel at the Seaport under construction in 2020.

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Massport Real Estate Assets as of 2020 9 million sq. ft. NEW PROJECT OPENINGS Hyatt Place Boston/Seaport District Hotel Despite some construction delays from temporary COVID-19 restrictions, several major projects were successfully completed in 2020.

Gables Seaport luxury apartments opened in Gables Seaport September 2020. The Gables Seaport, a 307-unit apartment tower in South Boston adjacent to the World Hyatt Place Boston Trade Center MBTA Silver Line station, opened Developed in conjunction with the adjacent in September 2020. The project contributes to Ora Seaport Apartments, the Hyatt Place the public realm in the South Boston Waterfront Boston/Seaport District Hotel also opened in District by providing a much-needed pedestrian September 2020. The upscale limited-service connection between Congress Street and World hotel has 294 rooms and a variety of meeting Trade Center Avenue for enhanced access to the spaces. The hotel shares a 450-car below-grade area’s main arteries and public transportation. parking garage, an urban entry courtyard, and a second-level landscaped podium with Ora Seaport Apartments and incorporates similar Ora Seaport Apartments resiliency features to protect from potential floodwaters during storm surges. Ora Seaport Apartments is a 304-unit apartment building on Northern Avenue, directly opposite Boston Harbor in South Boston. The project, Boston Sword & Tuna which opened in September 2020, set a new standard for community-oriented urban Boston Sword & Tuna, a fifth-generation design and the resiliency challenges posed family-owned seafood business, opened a new by waterfront locations. The project features seafood processing plant at the Massport Marine an elevated ground floor to mitigate potential Terminal in March 2020. The approximately flooding, landscaping elements that absorb 50,000-square-foot state-of-the-art facility is rainwater, and a variety of interwoven public the latest expansion within the South Boston spaces, such as sloped walks and walls that seafood industry cluster. Boston is one of four double as outdoor seating. In addition, Ora national hubs for seafood processing in the Seaport Apartments is the first project in Boston United States, and Boston Sword & Tuna is one to use passive flood barrier gate technology that of more than 50 seafood businesses in and near is activated by rising water levels to protect South Boston that depend on Boston Logan the building’s below-grade parking. and Conley Terminal to ship and receive fresh seafood globally. Ora Seaport Apartments opened in September 2020.

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PROJECTS IN THE PIPELINE 401 Congress Street (formerly Parcel A-2) Pre-construction design and planning work for 401 Congress Street continued to advance in 2020. The development team, led by Boston Global Investors, modified the project’s development program from 100% office space to a 50/50 split of office and lab space to respond to Boston’s strong life-sciences market. The 581,000-square-foot, 18-story building will feature over 100,000 square feet of new indoor and outdoor public-realm space as well as an Construction on the Commonwealth Pier is underway. extensive plan to promote diversity, equity, and inclusion throughout the project’s development, construction, and operation phases. The project achieved key design and development permitting Omni Boston Hotel Commonwealth Pier milestones in 2020 and is on track to start Considerable progress was made on the Pembroke Real Estate, a unit of Fidelity construction in late 2021 and be completed in 2024. construction of the Omni Boston Hotel at the Investments, is revitalizing the historic Seaport. Located on Summer Street directly Commonwealth Pier and modernizing Fidelity’s Omni Boston Hotel. opposite the Boston Convention & Exhibition 800,000 square feet of office space on the pier. Center (BCEC), the upscale, full-service hotel The project incorporates critical resiliency and will feature 1,050 guest rooms and 100,000 sustainability improvements; commitments to square feet of meeting space, including a diversity, equity, and inclusion; and the creation 25,000-square-foot main ballroom. The Omni of substantial new areas of waterfront public Boston Hotel project, the first in Massport’s realm, including a waterside public plaza, an portfolio to implement the Massport Diversity enhanced Harborwalk, and improved pedestrian Model, incorporates high levels of minority and connection to World Trade Center Avenue. women-owned business enterprise (M/WBE) Investments in water transportation, including participation in the hotel’s design, construction, more dock capacity, public access improvements, equity investment, and future operations. public restrooms, and covered waiting areas, will The hotel is expected to open by fall 2021. provide additional transportation benefits and amenities for the South Boston Waterfront. The project is expected to be completed in 2024. The Omni Boston Hotel project is the first in Massport’s portfolio to implement the Massport Diversity Model.

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Fish Pier workers unload the catch from a fishing vessel with new COVID-19 safety measures.

The Padre Pio, a fishing vessel owned by Atlantic Coast Seafood.

SUPPORTING TENANTS DURING THE PANDEMIC As part of Massport’s commitment to support the seafood industry, we worked to ensure that our seafood tenants were aware of federal and state relief funds and grants available to them during the COVID-19 crisis. Four Boston Fish Pier tenants received grants as part of the Commonwealth’s Food Security Infrastructure Grant Program. The $36-million program is the centerpiece of the Baker-Polito Administration’s $56-million effort to address food insecurity due to COVID-19, with a special focus on food that is produced locally. Red’s Best received $490,000 to build a new processing line and purchase a fish-packing machine and an industrial freezing machine. Atlantic Coast Seafood was awarded $500,000 for infrastructure upgrades to ice machines that will improve ice-making capacity to better meet the needs of the New England fishing fleet. Wulf’s Fish Wholesale received $337,500 to expand new e-commerce operations to increase purchasing with fishing communities in Massachusetts, boost opportunity in food processing, reduce food insecurity, and expand seafood nutritional education. The F/V Padre Pio, a fishing vessel owned by Atlantic Coast Seafood, received $115,000 to develop an automatic fish-gutting and conveyor system on its deck that will significantly reduce the amount of time a catch is exposed to ambient temperatures before being stored safely below on ice, allowing vessels to catch fish at a higher quality with longer shelf life. These grants are a great example of the public and private sectors working together to promote healthy food options for our citizens while helping small businesses improve their operations and become more resilient in the wake of unprecedented disruption to their industry.

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MASSPORT IN THE COMMUNITY

As an agency that operates in such close proximity to a number of surrounding communities, Massport’s goal is to always be a good neighbor. Therefore, we’re always listening. Through our deep commitment to the success of these vibrant neighborhoods, we strive to be a model for how airports, seaports, and their neighboring communities can work together to address challenges and create opportunities. In 2020, though we struggled with revenue generation, we continued to prioritize the positive impact we have in our communities.

CREATING GREEN URBAN SPACES Piers Park III project rendering. Charlestown Community Benefits Piers Park III Massport committed to design and construct Massport designated The Trustees of a package of community-benefit investments Reservations to develop Piers Park III, the in Charlestown as part of a renewed lease first urban waterfront park in their vast and agreement for the Moran Annex, a city-owned impressive portfolio. As part of The Trustees’ asset that Massport subleases to the Boston One Waterfront Initiative, the organization Autoport for its maritime industrial operations. seeks to advance bold, innovative, and iconic The community benefits include landscape open-space destinations on Boston’s waterfront screening of the Moran Annex to create a while supporting the needs and accessibility of visual buffer between nearby residential areas a diverse community and providing solutions and industrial activities, and the creation of to climate resiliency. These goals align well a Charlestown Community path, a half-mile- with Massport’s mission and our commitment long pedestrian/bicycle path connecting to to neighboring communities. The vision for Sullivan Square. Massport will collaborate with Piers Park III is an iconic urban park on the East MassDOT on a third project to create a more Boston waterfront that will complement the direct Harborwalk connection beneath the Tobin existing Piers Park I, developed by Massport in Bridge between Barry Field and the Charlestown 1995, and Piers Park II, which is currently in the Navy Yard. The improved Harborwalk connection design and community outreach phase. Massport will keep bicycles and pedestrians separate and expects to execute a development agreement safe from truck routes serving the Charlestown The Charlestown Community path, a half-mile-long and ground lease with The Trustees in 2021. pedestrian/bicycle path. Designated Port Area.

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Massport Memorial Scholarships Massport awarded four memorial scholarships in 2020, including a new scholarship created in honor of the late Port Director, Deborah Hadden Gray, who passed away in September 2019.

Deborah Hadden Gray, late Port Director.

Massport’s Community Summer Jobs Program at the Piers Park Sailing Center. The four impressive local high school seniors who received the scholarships went on to study at Harvard University, Ohio Wesleyan, Plymouth State, and the University of New Hampshire. Massport’s Community Summer Jobs Program The scholarship award ceremony COVID-19 restrictions made it difficult for some summer jobs programs to move forward in was celebrated virtually in 2020. However, many Massport programs were place of a traditional event. able to open and provide meaningful summer employment for local students. Massport’s Community Summer Jobs Program, which started in 1991, employed 279 students at 25 different organizations.

Dina Kobeissi, winner of the Deborah Hadden Gray Scholarship.

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Massport’s Backpack Project for Children We celebrated Massport’s 12th annual Backpack Project for Children, where employees filled backpacks with school supplies and back-to- school outfits. Forty-nine students from three organizations—Crossroads Family Center in East Boston, South Boston Neighborhood House, and Community Action for Safe Alternatives (CASA) in Winthrop—received new backpacks and back-to-school outfits.

Massport’s Backpack Project for Children. Massport’s Thanksgiving Food Drive Every year, Massport aims to provide healthy food to those in need. In 2020, Massport Massport’s Veterans Day Donation Drive employees filled more than 40 boxes with food Annually, Massport organizes an employee drive donations and provided over $300 in grocery to provide local veterans with needed personal store gift cards. The food donations went to items. In 2020, employees donated hundreds three local food pantries: Winthrop Community of personal-care items such as toothpaste, Food Pantry, Crossroads Family Center in East shampoo, sheets, DVDs, hats, and socks to Boston, and the South Boston Community the veterans at the Chelsea Soldiers’ Home. Health Center Food Pantry. Veterans Day Donation Drive at the Chelsea Soldiers’ Home. Massport’s Winter Coat Drive Massport employees stepped up and donated warm coats for area children. Forty coats were distributed to children in need at the Condon Community Center in South Boston and the Crossroads Family Center in East Boston.

Massport employees participate in the Thanksgiving Food Drive by delivering items to the South Boston Community Health Center Food Pantry. Winter Coat Drive at Condon Community Center.

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DIVERSITY, EQUITY, AND INCLUSION

This past year, Massport continued to foster a BUSINESS DIVERSITY SUMMIT COVID-19 RESOURCE GUIDE culture of diversity, equity, and inclusion within Each year, Massport’s Business Diversity Summit To help Massport’s small businesses of color the Authority and worked hard to enhance brings together businesses owned by people of navigate the federal coronavirus relief programs, access, opportunity, and equity for people of color, women, and other diverse groups to learn Massport partnered with BECMA and the Greater color and diverse businesses in the community. more about opportunities to do business with New England Minority Supplier Development Massport. While we could not foster in-person Council (GNEMSDC) to create a COVID-19 business networking as in past years, we hosted financial relief resource guide. We also created our 7th Annual Business Diversity Summit as a a loan and technical assistance resource guide virtual event in December 2020. More than 100 that was published on Massport’s website and people representing diverse businesses attended reached approximately 500 diverse businesses/ the virtual event and learned about Massport’s local organizations. bid and RFP procedures, COVID-19 impacts on small/diverse businesses, and upcoming contract opportunities. Segun Idowu, Executive Director, VIRTUAL EVENT SERIES Black Economic Council of Massachusetts, Inc. Massport continued hosting diversity, equity and (BECMA), delivered a keynote address focusing inclusion programming as virtual events in 2020. on diversity, equity, and inclusion and the current We celebrated diverse cultures with virtual events economic state of small and diverse businesses. for Asian/Pacific American Heritage Month, It was a successful event that we will continue LGBTQ Pride Month, National Hispanic Heritage in 2021. Month, and Veterans Day. These events featured Segun Idowu, Executive Director, Black Economic outside speakers and proudly spotlighted Council of Massachusetts, Inc. (BECMA). Massport’s valued team members who shared their personal stories, experiences, and cultures.

Massport’s Virtual Diversity, Equity and Inclusion event series.

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SUSTAINABILITY AND RESILIENCE

INDUSTRY RECOGNITION Massport’s innovative and comprehensive plan to reclaim a former brownfield site in South Boston and reduce impacts on the neighborhood and environment received industry recognition in September 2020. The American Association of Port Authorities (AAPA) presented Massport with its 2020 Comprehensive Environmental Management Merit Award for the Conley Terminal Modernization Program soil reclamation and reuse program. The program focused on the former Coastal Oil site, which operated for decades as a bulk oil storage facility adjacent to Conley Terminal. Massport purchased the facility in early 2000, demolished the remaining oil tanks, and began a comprehensive environmental assessment and remediation program to address soil and groundwater contamination at the facility. The American Association of Port Authorities (AAPA) 2020 Comprehensive Environmental Management Merit Award for the Conley Terminal Modernization Program, pictured here with Massport team members Miguel Escuer, Chet Myers, and Kevin McWeeney.

Massport partnered with the contractor and Aviation and Maritime Joint Hurricane consultants to test, manage, treat, process, and Tabletop Exercise reuse approximately 61,000 cubic yards of soil Massport Capital Programs and Massport Corporate material onsite. As a result, no urban fill, oily Security and Emergency Preparedness conducted soil, or sediment was transported for offsite an internal tabletop exercise with the aviation and disposal in landfills. This program eliminated maritime departments. The exercise simulated a significant greenhouse gas emissions in the Category 2 hurricane making landfall in the Boston neighborhood by avoiding 5,200 truck trips for area with impacts lasting through three high-tide offsite disposal and 3,500 truck trips for import cycles. The simulation provided an opportunity of subbase material. to review the Boston Logan and maritime Flood Operations Plans in detail and coordinate the efforts Soil material at a former brownfield site was outlined in the plans. reclaimed, treated, and reused on site.

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FISCAL RESPONSIBILITY

RESPONSIBLE STEWARDS Massport was created by Chapter 465 of the Massachusetts Acts of 1956 (“the Enabling Act”). Under the Enabling Act, Massport has the power to issue revenue bonds for financing purposes; fix, revise, charge, and collect rates, fees, rentals, and charges for the use of its projects; and maintain, repair, operate, extend, enlarge, and improve its projects. While we periodically receive federal and state funding grants for specific purposes, such as the modernization of Conley Terminal and runway and taxiway improvements at airport facilities, Massport remains an independent public authority and is financially self-reliant. Massport has the financial and operational independence to enhance the experience of customers using our facilities, be a responsible steward of the assets under our control, Sources: Peer Airports 2019 Comprehensive Annual Financial Reports; Massport 2019, 2020, and 2021 Comprehensive Annual Financial Reports. and plan for strategic investments for use by future generations. All of these activities MARGINS TURN NEGATIVE, FIRST TIME IN DECADES support Massport’s mission to drive economic development for the Commonwealth by The COVID-19 pandemic and related restrictions have had an adverse effect on Massport’s connecting Massachusetts to the global businesses. Recovery is likely to be measured in years, not months. The unprecedented economy and providing quality services declines in business activity and the uncertain timing of a recovery required Massport to and opportunities to our many and diverse immediately begin scenario planning, prepare sustainability plans, reduce expenses, identify customers, stakeholders, and business partners. new revenue opportunities, advance liquidity strategies, and seek federal assistance to address an expected $400-million multi-year revenue loss. Massport’s margin continues to be lower than peer airports, and we expect negative margins in 2021 until air passenger travel recovers.

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Massport will continue to provide the highest levels of safety, security, and public health services expected by customers.

Massport relied on federal assistance for Looking ahead, a greater share of Massport’s airports provided through the CARES Act to pay capital investment will be funded through the essential operating expenses and bond-holder issuance of revenue bonds. In connection with obligations during the pandemic. Massport Massport’s most recent bond sale in March 2021, will continue to exercise prudence, financial the three major bond rating agencies affirmed discipline, and stringent cost controls to manage Massport’s AA bond rating based on financial throughout the remainder of the pandemic while sustainability plans and fiscal actions taken to continuing to provide the highest possible levels date. This is good news because it demonstrates CAPITAL INVESTMENT REPRIORITIZED of safety, security, and public health services that the capital markets have confidence in DURING THE PANDEMIC expected by the customers, partners, and Massport and allows us to access the capital stakeholders who use our facilities. Prior to the pandemic, Massport’s strategic plan markets so we can continue to make strategic prioritized new investments to accommodate investments that will best meet future needs. growing demand by transforming Boston Logan’s terminals and checkpoints, improving runways, reconfiguring terminal roadways to ease congestion, and expanding HOV options. The strategic plan also prioritized investment in Conley Terminal to accommodate larger ships that will transport more imports and exports to meet the needs of consumers and shippers. To balance Massport’s strategic priorities with reduced revenues, management reprioritized strategic initiatives and focused resources on completing four new aircraft gates at Terminal E instead of seven, the Terminal B-to-C Connector for better passenger flow between terminals, the Terminal B-to-C Roadways to eliminate Throughout 2020, the Massport team was bottlenecks, a new deepwater Berth 10 and innovative, focused, creative, and adaptive three new ship-to-shore cranes for efficient to the disruptions and challenges posed by operations at Conley Terminal, and major the pandemic. Having gone through this maintenance of existing assets. Other capital transformation, Massport is now stronger, projects were either rescoped, deferred, or leaner, and more innovative, allowing us to paused, resulting in a 45% reduction to the continue fulfilling the Authority’s mission. Capital Program. Construction of the new 50-foot-deep Berth 10 at Conley Terminal was completed in 2020.

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CURRENT SENIOR STAFF

JOEL BARRERA BRIAN DAY MIKE MEYRAN Director of Strategic Director of Labor Relations/Labor Counsel Port Director & Business Planning EDWARD FRENI REED PASSAFARO TIFFANY BROWN-GRIER Director of Aviation Chief of Staff Acting Director of Diversity & Inclusion/Compliance DAVID GAMBONE JOHN PRANCKEVICIUS Chief Human Resources Officer Director of Administration LUCIANA BURDI & Finance/Secretary Treasurer Director of Capital Programs ANDREW HARGENS & Environmental Affairs JOHN RAFTERY Chief Development Officer Chief Marketing Officer KWANG CHEN Chief Information Officer CATHERINE MCDONALD CHRISTINE REARDON Chief Legal Counsel Acting Director of Internal Audit ALAINA COPPOLA Director of Community Relations JENNIFER MEHIGAN HAROLD SHAW & Government Affairs Director of Media Relations Chief Security Officer

SENIOR STAFF ALSO SERVING IN 2020

VIRGINIA FLYNN JOSÉ MASSÓ HOUSSAM SLEIMAN KENN TURNER Director of Internal Audit Director of Policy Director of Capital Programs Director of Diversity & Environmental Affairs & Inclusion/Compliance

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BOARD OF DIRECTORS

LEWIS EVANGELIDIS Chairman of the Board Sheriff of Worcester County

PATRICIA JACOBS JAMEY TESLER SEAN M. O’BRIEN Vice Chair Acting Secretary of Transportation

JOHN NUCCI WARREN FIELDS LAURA SEN

BOARD MEMBER ALSO SERVING IN 2020

STEPHANIE POLLACK Former Secretary of Transportation

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