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Issue link: http://airportbusiness.epubxp.com/i/516939
May 2015 airportbusiness 5 INSIDE THE FENCE Ronnie L. 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Airport Business (USPS 001-614; ISSN 1072-1797 print; ISSN 2150-4539 online) is published 8 times per year in Feb/Mar, April, May, Jun/Jul, Aug/Sep, October, November and Dec/Jan 2014. Periodicals postage paid at Fort Atkinson, WI and additional entry offices. Change of address or subscription information: Toll Free: 877-382-9187, Local: 847-559-7598, Email: circ. airportbusiness@omeda.com. POSTMASTER: Please send address changes to Airport Business, Cygnus Business Media, PO Box 3257, Northbrook, IL 60065-3257. Printed in the USA. Canada Post PM40612608. Return Undeliverable Canadian Addresses to: Airport Business, PO Box 25542, London, ON N6C 6B2. Canadian GST #842773848. Vol. 29, No. 5 May 2015 A few facts: Passenger load factors are aver- aging 90 to 95 percent. That's about 35 to 40 percent more than they were when most airport facilities were designed and built. Aircraft are larger and gate turns more frequent. Thirty years ago, a gate averaged four to five turns a day. Those same gates may handle 10 flights today. Facilities are aging; some of today's airport infra- structure is more than 50 years old. At the same time, passenger demand for new tech- nologies that streamline the process to make it more efficient and for better concessions/retail options is on the rise. Airports Council International-North America estimates airport improvement projects, from parking facilities to airport hangars and commercial space in terminal buildings, will cost approximately $72.5 billion over the next four years. The reality is that airports need facility updates. They need to add new passenger amenities. And they need to incorporate technology to ease the travel process. The challenge is how to pay for it. According to the Government Accountability Office, airports use 68 percent of PFC revenue—a fee that hasn't been adjust- ed for inflation in 15 years—to fund needed landside improvements and pay interest charges on debt. The good news is that the FAA has proposed raising the federal cap on the PFC from $4.50 per enplaned passenger to $8. But at the same time, the FAA is pro- posing reducing the overall amount of grants it makes to airports under the Airport Improvement Program (AIP)—going from $3.35 billion in 2015 to $2.9 billion in 2016. How those numbers shake out remains to be seen. So what'cha going to do? This seems to be the $72.5 billion question. "Find Spaces" on Page 10 examines all of these issues, and offers sage advice from airport architects and consultants on where to cost-effectively find and create space within the terminal, what pas- sengers are looking for and how to pay for it. When it comes to finding space in cramped facilities or building new or renovating an existing terminal, "you have to think outside the box," says Mark Lobel, lead concessions designer for Corgan Associates. And he's right, in today's world space and funding to update or build new may not come from traditional places. Consider what Wichita has done. Wichita Dwight D. Eisenhower National Airport just built a new terminal from the ground up. This airport will pay off the general obligation bonds issued by the city for the project with PFC funds, rental car and parking funds, pay-as-you-go airport system revenues, surplus cash, and concessions and retail rents. Wichita leadership got creative and got the project done. What will you do to accomplish the same? What'cha Going to Do? CHARLOTTE DOUGLAS KICKS OFF $2.5 BILLION CONSTRUCTION PROGRAM Immediately after completing an eight-year construction project, Charlotte Douglas International Airport got right back on the horse. This month, the airport kicked off a 10-year, $2.5 billion construction program that will include an expansion of the terminal lobby and concourse A, as well as the addition of a new runway and new roads. Construction will begin this summer. ACI-NA estimates airport improvement projects will cost approximately $72.5 billion over the next four years.