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Infratil Backs Prospect of Successful Commercial Airport at Whenuapai

20 Jan 2004

New Zealand listed public company Infratil Ltd, an experienced international investor in airports, says a commercial airport at Whenuapai servicing low-cost airlines has a good prospect of succeeding, and stimulating development of an associated business park and other amenities.

Under the company's partnership agreement with Waitakere City Council it will contribute all of the development capital required to obtain the necessary consents and convert the present military airport to commercial use, if the Government gives the concept the green light.

In its submission to the New Zealand Defence Force, Infratil says this is likely to involve a capital contribution of approximately $50 million to upgrade the runway and terminal facilities.

The company says there is encouraging interest from airlines and it would be desirable to start developing the commercial airport as soon as possible while the Air Force winds down its operations. Infratil has experience in managing airports where military and commercial uses co-exist.

Infratil spokesman Tim Brown said today that a commercial airport at Whenuapai is potentially a sound venture for an investor taking a long term view. It could deliver competition, meet changing airline industry needs, stimulate air travel by attracting new operators and providing material benefits for travelers.

"We have researched this carefully, and we would not be involved if we did not think the prospects for a successful commercial airport are encouraging".

The Infratil submission estimates that about half of the 311 hectare Whenuapai site will be required for commercial airport operations. Much of the rest of the site could be developed as an associated business park, possibly with some recreational and community facilities.

The submission says this should give the Defence Force a far better return on the land than alternative development proposals, which involve the destruction of the existing airport infrastructure. The more successful the airport, the more valuable the associated surrounding land will become.

"Our partner, Waitakere City, well understands the enormous positive contribution that a successful commercial airport, with an associated business park, will make to the northwest in terms of the economy and jobs."

Infratil envisages that a commercial airport at Whenuapai would never approach the scale of Mangere, but that it could readily be the base for low cost air services to New Zealand cities and towns, to the east coast of Australia and destinations in the Pacific. The advent of civil operations at Whenuapai would be expected to stimulate additional air travel and Whenuapai could gain up to 15% of Auckland's expanded aviation market within 10 years.

Mr Brown says smaller airlines offering low cost, no-frills services, would welcome the lower cost structure of Whenuapai and its lack of congestion. These benefits would be passed on to customers.

"It is not as though Whenuapai is in some fringe location. These airlines realize that half the people in the Auckland region live nearer Whenuapai than Mangere".

Infratil, listed on the New Zealand Stock Exchange, has some 20,000 New Zealand shareholders and bond holders.
It owns 66% of Wellington airport, and has experience in managing environmental, social and civil aviation issues in an urban area.

It is also owner of Glasgow Prestwick International Airport in Scotland, one of the UK's fastest growing airports, which has more than doubled passenger numbers since Infratil acquired a controlling interest in 2001.

Infratil has a solid record of working in partnership with local bodies, and working closely with local communities. The company intends to work with local communities in Greenhithe and Paremoremo to allay their fears about noise from a commercial airport at Whenuapai. It says 80% of take-offs, which generate more noise than landings, will be to the west of the airport.

Mr Brown said it would be ludicrous to tear down the Whenuapai airport and breakup the runways without even attempting to create a commercial airport and business park.

"If we can't succeed, the Government can take the land back, and all of the other options will still be there", he said.

Mr Brown said the way forward was for the Crown, NZ Defence Force, Waitakere City and Infratil to work closely together to build up a successful civil aviation operation, and to use this at the basis for ancillary commercial development of the surrounding area.

Infratil's submission view as PDF(file size 2.1 MB)


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