Caroline Cook explains how airport development across Canada and the United States is aiding efforts to boost the economy.
For almost three years, the North American economy has been slowly recovering from the global recession and, despite some sceptical analyses, most recent reports indicate that US and Canadian citizens are beginning to feel less threatened by the prospect of a double-dip downturn.
The Interim Economic Assessment by the Organization for Economic Cooperation and Development (OECD), released on March 29, estimates that the region’s economy will experience “robust growth” throughout 2012, with the US growing 2.9% in the first quarter and 2.8% in the second. Canada’s economy is forecast to increase by 2.5% during the same period.
With the steady incline of most economical factors, it appears that most North American businesses are feeling hopeful about the region’s financial future.
Business Roundtable (BRT), an association of Chief Executive Officers (CEOs) from leading US companies, completed a survey of 128 of its members between March 1 and 19. The results show that 81% of participants expect an increase in sales in the next six months, 48% expect an increase in capital spending and 42% forecast a rise in employment. Although modest, the findings clearly show that CEOs across the region are anticipating a more successful future.
BRT Chairman Jim McNerney, who is also Chairman, President and CEO of The Boeing Company, stated: “The results indicate greater overall economic optimism among member CEOs compared to last year. Several factors, among them oil prices, a sluggish European economy, political uncertainty in the US, and questions about future growth in Asia, remain as potential obstacles to higher rates of economic growth in the United States.”
The Impact of Airports
North American aviation in particular is playing a role in improving the economy. Airports Council International North America (ACI-NA) has conducted several studies on the topic, including one earlier this year to discover how the region’s airports contributed to the economic recovery.
The Economic Impact of Commercial Airports in 2010 – the first study of its kind in ten years – was undertaken by CDM Smith, formerly Wilbur-Smith Associates, and analysed direct data from 272 out of 490 commercial airports. The company used this data to estimate the figures of the remaining airports.
The study found that airports support a total of 10.5 million jobs, creating an annual payroll of US$365 billion. It also found that the gateways produced an annual output of an astonishing $1.2 trillion. These findings show that airports offer 56% more jobs, 92% more payroll and produce 133% more output than they did in 2001.
ACI-NA used the results to suggest that if Airports, Inc. – the collective name chosen to encompass all commercial airports in America – were a country, its annual output would exceed the gross domestic products (GDPs) of Mexico, South Korea, and Australia, among others. In fact, it would be the 13th largest global economy, according to World Bank figures.
Airports, Inc. would also be the second largest employer in North America, next to Wal-mart Stores, Inc. In full, commercial airports represent 7% of the region’s jobs and 8% of GDP.
Despite ACI-NA’s findings, on February 14, the Federal Aviation Administration (FAA) Modernization and Reform Act of 2012, also known as the Reauthorization Act, was signed into law. The bill, signed after five years of waiting and 23 short-term operating extensions, provides the FAA with $63.4 billion of funding until 2015.
FAA operations have been authorised at almost $10 billion per year, and more than $2.5 billion per year will be appropriated for facilities and equipment.
However, ACI-NA’s Executive Vice President of Policy and External Affairs Deborah McElroy describes the bill as “terrible” for the nation’s airports. She explained to Airports International that no increase has been made to the passenger facility charge (PFC) – the fee paid by enplaned passengers to contribute funds to an airport’s FAA-approved projects – which will remain at $4.50 as it has been since the turn of the century. ACI-NA has stated that this ceiling should be raised to at least $8 to reflect construction cost inflation, estimating that more than $17.5 billion per year is required just to fund the current capital programmes.
Ms McElroy also believes that other parts of the bill, such as the lower level of Airport Improvement Program (AIP) funding to $3.35 billion per year, will have “a bad impact on the industry.” After peaking in 2006, AIP funding is now projected to be 49.4% lower in constant dollars. However, it is important to note that the legislation has increased the local share of AIP projects at smaller airports.
ACI-NA estimates state that airports will need $80 billion of capital improvement over the next five years, including runways, terminals and other facilities, but Ms McElroy commented: “It’s difficult to see how airports can achieve that without additional funding from the FAA or an increase in the PFC.”
There were several victories for North American airports in the act. As well as providing liability- and data- protection for safety management systems, Ms McElroy describes how the Transport Security Administration (TSA) must now consider airport applications for the Screening Partnership Program (SPP), which supplies airports with a private screening company for their security needs.
Appropriations have also been authorised for the now-permanent Airport Cooperative Research Program for research into the airport environment, although a specific funding amount or source has yet to be identified.
With all the changes to legislation and grant eligibility, it is important to realise the vast amount of design, development, and construction projects currently under way across the US and Canada.
A principal concern among many airports is the expansion of passenger terminals in order to accommodate larger passenger numbers projected for the future. Here, Airports International provides a round-up of airports in North America that are welcoming improvements.
Alaska Airlines unveiled its ‘Airport of the Future’ concept at Los Angeles International Airport’s Terminal 6 on March 27, 2012. The carrier, which was previously based in Terminal 3, has provided passengers with new check-in kiosks and bag-check stations. It claims that this “seamless” process reduces average wait times to four minutes per customer, as it has already demonstrated in Anchorage and Seattle, where ‘Airport of the Future’ is already implemented.The terminal construction, which was completed within 13 months of breaking ground, cost $238 million – $33 million under budget – and also features a new Board Room lounge, a central service counter, and gate information displays. Half of the seats in the gate area have electrical outlets and the entire project was built in accordance with Leadership in Energy and Environmental Design (LEED) certification by the US Green Building Council.
Other airlines are also developing airport infrastructure across North America. In August 2010, Delta Air Lines, in collaboration with the Port Authority of New York and New Jersey and JFK International Air Terminal LLC, announced a $1.2 billion expansion project for Terminal 4 at John F Kennedy International Airport (JFK).
In addition to claims that more than 10,000 jobs will be created during construction, Delta estimates that the project will generate $500 million of personal income and $1.6 billion of economic output by 2015.
The expansion will extend the terminal to 1.5 million sq ft (139,355m2), three times its original size. The future Terminal 4 will feature 40 staffed check-in desks, 26 self-service kiosks, a 12-lane security screening checkpoint, seven baggage claim units for international passengers and two for domestic travellers. Additionally, 68 US Customs & Border Protection (CBP) inspection booths will be capable of processing up to 3,100 passengers per hour.
A total of 16 Delta gates will be accessible via 2,800ft (853m) of moving walkways, and dual taxiways on the airfield will facilitate aircraft movements and improve performance.
According to Delta, the development is progressing well and has reached its “halfway point”. The structural steel for the Concourse B extension is now in place, as well as a three-storey facility that will house the automated baggage system. After the new terminal opens in May 2013, Terminal 3 – where Delta currently holds its operations – will be demolished in order to create space for additional aircraft parking.
On April 11, Delta also broke ground on a $160 million renovation of its facilities at New York’s LaGuardia Airport. The project will include a 630ft (192m)-long connector bridge between Terminals C and D and expanded security lanes in both terminals. It is the largest expansion project at LaGuardia for more than 40 years. The development will support 700 permanent jobs as well as more than 100 construction positions.
Delta’s CEO Richard Anderson remarked: “Altogether, with our expansion projects at JFK and LaGuardia, Delta is investing nearly $1.4 billion in our New York airport facilities.
“No other airline is approaching that level of commitment [to the city] in the next 12 months.”
After five years of construction, McCarran International Airport (LAS) in Las Vegas is set to open its new Terminal 3 on June 27.
Prime consultant and architect PGAL designed the $2.4 billion project, which has the capacity to handle up to six million passengers per annum (mppa), bringing the airport’s total to 53 mppa. It has been estimated that T3 will allow LAS to process – at a minimum – almost 40% more international travellers during peak periods.
The 1.9 million sq ft (176,516m2), three-storey Terminal 3 has two separate-level security checkpoints with a total of 31 lanes, 15 baggage carousels, 14 gates – seven dedicated to international services – and a 6,000-space, eight-level parking structure. There is also an expanded and upgraded CBP area, stacked roadway system and an underground Automated Transit System.
New technology has been used throughout the terminal, with 32 kerbside (also known as curbside) check-in positions and an additional 130 positions in the ticketing lobby. The terminal is 100% common-use, and features 203 self-service kiosks, including capabilities for self-tagging baggage. Self-boarding gates and automated aircraft docking are also provided in the WiFi-enabled terminal. Signage is made up of 1,150 LCDs and LEDs and there are 1,000 cameras around the facility.
One of North America’s most recent success stories is told by Lambert-St Louis International Airport (STL). Severely damaged by a tornado in April 2011, construction employees and airport staff have worked tirelessly to restore the gateway, at an estimated cost of $25-30 million.
Although STL was reopened and operational within 24 hours of the storm, the high winds had caused considerable damage – the C Concourse remained closed due primarily to extensive roof damage, as well as damage to windows, gate areas, stores and restaurants. Terminal 1 also had windows blown out of the three-storey-high domes which frame the ticketing level.
The tornado hit the airport less than ten days after construction began in Terminal 1 and Concourses A and C for the $50 million second phase of STL’s ‘Airport Experience’ renovations. This phase included replacing tile flooring, adding new ceilings and updating the airport’s bathrooms in the concourses, as well as installing a more efficient circular pendant lighting system, new signage and directories.
Since last April’s storm, the ‘Airport Experience’ has continued in Terminal 1 with the construction or renovation of bathrooms by Baggage Claim and the relocation and expansion of the C Checkpoint, among others. It is due to be completed by the spring of 2013.
Restoration of the tornado damage to Terminal 1’s windows was completed by mid-December 2011, less than nine months after the storm. Local company Hilboldt Curtainwall Inc, undertook the $900,000 project – designed by exp (formerly Teng & Associates, Inc) – in August 2011 and replaced more than 300 panes of laminated glass in the terminal’s ticketing lobby. More than 15,500sq ft (166,841m2) of new glass was installed within the original framing. The terminal’s skylights were also replaced.
Concourse C’s restoration was altogether a more difficult task. Work included replacing 250 windows, installing 1.5 acres of new roofing, repairing or replacing 60 rooftop mechanical units and installing 11 miles (17.7km) of cabling.
The roof and window placements were completed by the start of 2012, and the focus moved to renewing the interior of the concourse, including stores and restaurants. ‘Airport Experience’ renovations were also restarted and work included newly painted ceilings, new lighting and a fully-tiled central corridor, as well as five art-glass screens created by local artists.
The C concourse was reopened and fully operational on April 2, almost meeting the first anniversary of the tornado. Around $15 million was spent on both the restoration and the previously planned interior renovations.
The award-winning Green Build project for Terminal 2 at San Diego International Airport (SAN) has been ongoing for more than three years. By the end of the development in August 2013, Terminal 2 will have ten new gates, six additional security lanes – bringing the facility’s total to 12 – and an expanded concessions area. Furthermore, 26 check-in positions will be added to the terminal, as well as 32 ‘Skycap’ check-in positions on the airport’s Smart Curb pavilions. Around 120 self-service kiosks will also be installed.
According to sources at the airport, construction has just met the 50% completion mark, with recent milestones including the completion of the terminal’s steel framework, the completion of the underground utility relocation and a new jet engine blast fence.
Within the next six months, SAN hopes to install all glass in the terminal, finish its reflective roof, add two pedestrian bridges and a new baggage system. A new dual-level roadway is also being constructed. A Discovery Center for passengers was also opened in March to allow passengers to learn about the improvements.
Of course, it is not just airports in the United States that are experiencing improvements – several gateways in Canada are undergoing construction to accommodate growing passenger numbers, including work on a long-awaited pedestrian tunnel for Billy Bishop Toronto City Airport.
Around two years away from completion, the tunnel will provide a more convenient and efficient access route for passengers making their way to the island airport.
Plans state that the tunnel will be 800ft (244m)-long and ten storeys underground, with four moving sidewalks, each travelling at a speed of 1.4 miles per hour (2.3 kilometres per hour).
The $82.5 million project, financed via the private sector and the Airport Improvement Fee (AIF), follows 2011 statistics, which show that 1.55 million passengers used the airport throughout the year. Many officials believe that not only will the new tunnel encourage more passengers, its construction will create jobs and “benefit long-term economic growth.”
Whilst preparatory and excavation works have been under way since March, actual tunnelling was due to commence as Airports International went to press.
On January 25, Vancouver Airport Authority announced a ten-year strategy outlining $1.8 billion in improvements for Vancouver International Airport (YVR).
The main goals laid out in the strategy are to reduce connection times between international and domestic flights, enhance baggage systems and invest in terminal upgrades.
To do this, the authority will first create more than 2297ft (700m) of secure corridors and moving walkways, install new baggage systems, upgrade the 1968 domestic terminal building and provide runway safety enhancements. Construction has already started on the terminal upgrades – set for completion in January 2015 – and other work is due to begin by September.
As a result of these plans, the airport’s AIF has been increased to $20 for passengers travelling outside of the British Columbia region.
The authority’s President and CEO Larry Berg explained: “YVR employs 23,600 people, is home to 400 businesses and generates $1.9 billion in GDP for Canada. It’s no surprise that we have to continue investing in our airport to ensure we remain an economic engine for our community.”
Further east, Calgary International Airport (YYC) is continuing with its $2 billion Airport Development Program, comprising the Runway Development Project (RDP) and the International Facilities Project (IFP).
The RDP – scheduled for completion by May 2014 – consists of building YYC’s fourth runway, a new apron, taxiways, and a central de-icing facility. The runway, which will have Category III centreline lighting, will be 14,000ft (4,267m) – long and 200ft (61m)-wide, capable of handling the world’s largest aircraft.
At the end of 2012’s first quarter, the airport released an update report on construction, which stated that the RDP was making “excellent progress.” Crews have already relocated more than 75% of the 7.5 million cubic metres of dirt and rock on the site, and construction of two underpasses, one beneath Taxiway J and the other below Taxiway R, continues.
The IFP is Calgary’s single largest expansion. Incorporating sustainable design, the new International Concourse will “balance the need to create additional space, reduce energy consumption and minimise environmental impact.”
The terminal, which is due to open in 2015, will have five levels and 1,975,178 sq ft (183,500m2) of floor space. Additionally, a new Canada and US customs facility will be erected in the 22-gate concourse. More than 70 new shops and services will be offered and a state-of-the-art baggage handling system will be installed.
According to the Q1 report, up to 415 people are working on the construction site on an average day, and site excavation is now 90% complete. More than 2,670 metric tonnes of reinforcing steel have been installed and all five tower cranes are in operation.
Other projects at the airport include a newly-opened information centre in arrivals, and work continues on a NAV CANADA air traffic control tower which should open in November.
Undergoing its first expansion since 2001, the Saskatoon Airport Authority has recently commenced construction on its Airport Terminal Expansion projects, designed by local architects Kindrachuk-Agrey.
Budgeted at $53 million, the development is scheduled for completion by the summer of 2014. It is part of a ten-year, $105 million capital plan, which includes other projects such as a parking structure and a new hotel.
The new terminal will feature a pier design and offer eight gates, with an additional three ground-load positions. After almost doubling the size of the current space from 139,000sq ft (12,914m2) to 266,670sq ft (21,058m2), the AIF-funded facility will contain several concession services, a business lounge, comfortable seating, business stations and children’s play areas.
Caroline Cook explains how airport development across Canada and the United States is aiding efforts to boost the economy.