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Zidell Marine Corp. will cease building barges at its South Waterfront shipyards next year.

The news was shared with employees Wednesday in a memo from Jay Zidell, the company’s president. Zidell Marine will remain open, and continue to lease barges, he said.

Hull 686, expected to be delivered around the second quarter of 2017, will be the last barge built by Zidell Marine. About 60 employees will be affected.

The decision comes against a backdrop of development in the South Waterfront District.

鈥淭his has been a difficult decision for me, particularly recognizing the impacts on you, and one that has come upon us faster than I was expecting,鈥� Zidell told employees.

Tom Henneberry, the new chief operating officer of Zidell’s ZRZ Realty, is leading a master planning process for Zidell Yards.

鈥淢omentum is shifting there for the family business,鈥� said Kathleen Mazzocco, a spokeswoman for Zidell.

At the same time, demand for barges is decreasing as companies shift to larger barges that Zidell is not equipped to manufacture, Mazzocco said.

Jay Zidell was not available for comment, she added.

The Zidell family’s property in the South Waterfront totals 33 acres. It’s at the nexus of new development, including the Collaborative Life Sciences Building from Oregon Health and Science University and the Tilikum Crossing.