Manchester, UK, was the site of the Aerotropolis EMEA Conference, July 8-10. Manchester Airports Group has embarked on an £800-million (US$1.3-billion) Airport City development.
Photo by Mark Arend
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erotropolises do not happen overnight, and most face lengthy development challenges as they typically require input from multiple government and civic jurisdictions. Munich Airport’s ambitions are stymied by an ageing, green-thinking population, noted Dr. Michael Kerkloh, that facility’s president & CEO.
Munich is Germany’s richest city with virtually zero unemployment, and the airport is situated far from the city centre. Some suburbs want an additional runway at the airport, while others don’t and consider it to be a threat. The government is not supporting the venture, because it means more schools, kindergartens, social services and so on. It is an ageing society that is not future minded and is notably “green.” As the speaker observed, nothing can be kept secret at a publicly owned airport.
Gatwick Airport’s representative, Guy Stephenson, said the management there perceives a “UK role” for the airport in general and thus has focused on connectivity by air and rail. He mentioned the transportation corridor from the English South Coast via Gatwick Airport to South London, known as the Coast to Capital region. This is effectively Gatwick’s aerotropolis and is centred on a small development known as Manor Royal as the airport city — possibly the first one in the UK.
Gatwick’s own land portfolio is only 750 hectares (1,853 acres) in total, but local offsite developments such as Manor Royal have provided, in aggregate, a sizeable commercial community outside of that area.
Almost as he was speaking an announcement was being made about a £202-million ($342-million) growth deal for the Coast to Capital region, which will deliver the infrastructure and support that enables the region’s businesses to compete internationally and capitalise on the airport’s links to global markets, especially if Gatwick’s case for a second runway is successful.
Elitists Not Welcome, But Ordinary Folk Can ‘Hang Out’
Airport City Stockholm’s representative, Kristina Alvendal, said Stockholm Arlanda’s airport city would encourage people and firms to “hang out” there. The site is heavily environmentally oriented with schools as well as hotels; 1,000 new jobs have been created already. Professor Kasarda intervened to say that the development must benefit everyone, including blue collar workers, and a key task is how to communicate benefits to them.
Above all, the facility must not be seen as elitist, seeking merely to attract big corporations and attendant high earners. Otherwise there is the potential for discord amongst other tenants, who may even be discouraged from taking units.
Connectivity is the First Priority
London Heathrow Airport was well represented, in this case by Andrew McMillan, the strategy director. In the session “Going Global Through Aerotropolis Collaboration,” he stressed the need for connectivity. Three centuries of having either the global leading port or international airport situated in the UK was at risk.
He admitted to the unplanned nature of the sprawling Heathrow Airport, its connectivity and its ‘airport city’ but was keen to point out the improved rail services in the area that should bring a large part of the UK’s population within two hours of Heathrow, and those in Canary Wharf, close to London City Airport, within 40 minutes. On the other hand, he stressed how airport cities can benefit when political decision making is co-ordinated as it is in the UK.
A panelist in another session on Aerotropolis Collaboration, Sergio Alegre Calero, the deputy mayor of the City Council of El Prat (the location of Barcelona Airport), observed that Dubai “would kill” to replicate the mix of business, media and leisure interests as are found in UK cities. He also mentioned that 60 percent of the airport’s land is owned by the municipality but that it operates in a difficult area from the point of view of developing an aerotropolis in respect of social, political and economic concerns.
He described a chicken-and-egg situation there. The expansion of the aerotropolis is based on future passenger forecasts, but it is the aerotropolis itself that drives that forecast.
Growing Pains at Amsterdam Schiphol?
Reference was made on several occasions during the event to Amsterdam Schiphol Airport’s airport city, which was described as “the first airport city proper in Europe” by panellist Eric van der Kooij of the City of Amsterdam.
He said it had been successful in attracting businesses but was running out of space now. It is also limited by proximity to the city (which rather contrasts with the comments made by MAG’s John Atkins in Part 1 of this report). Noise remains an issue for nearby residents, whether from aircraft or trucks. The operator is shifting from push to pull marketing strategies and in particular trying to attract smaller businesses to the site, in contrast to some other operators.
Schiphol’s Airport City and its “inhabitants” face some uncertainty while the future of Lelystad Airport is debated.
Another significant (and technical) presentation concerning Schiphol was made in the very final session by Pieter van der Horst, the senior real estate developer for Schiphol Real Estate, who labelled the airport city there as the grand-daddy of them all.
Schiphol Real Estate (SRE) is one of four units of the Schiphol Group with a brief to develop, manage and invest in real estate around airports (Schiphol Group has other airports, notably Lelystad). It owns most of the land and buildings and leases them. There is a mix of aviation and non-aviation companies. There is flexibility of planning for certain areas, originally within six design principles that have since been reduced to two.
The aerotropolis that grew out of the airport city is known as the airport corridor, with the central area known as the Schiphol CBD (Central Business District). It is also the site of Schiphol Cargoworld.
SRE has found that companies are most influenced by the number and range of destinations available from the airport (which again restricts the opportunities for smaller airports). Furthermore connectivity is improving, and there is little problem with governance. Employees and tenants are referred to as inhabitants to make them feel they are actually working and living in a city. Bikes are made available for the free use of inhabitants, reducing foot journeys of 15 minutes down to two. There are fast, dedicated bus lanes and a bus station that was built out of redundant buildings from Rotterdam Airport.
The 1992 office building known as ‘The Base’ has been redeveloped as rental business suites or to be used on an annual contract basis for business meetings. The latest additions to the site are an 18-hole golf course (2013) and a new, 3-star hotel (2016). The General Aviation (GA) terminal is not really wanted any longer but as the airport is the only one in the northern Randstad region, it still accepts GA activity, although advertising by GA companies based there is not permitted. Another reason for hanging on to it is that captains of industry wish to land there in their private aircraft. However, they may be asked to shift their operations to Lelystad Airport, which Schiphol Group also owns.
Lelystad has recently been earmarked for sizeable investment, possibly up to €100 million, to enable it to take some of the weight off Schiphol, by taking charter flights and probably some LCC services, up to 5 million passengers per annum. There are clearly political issues involved, and neither the speaker nor other representatives from the airport or area were able to say for sure how the future development at Lelystad would mitigate against Schiphol’s airport city.
In conclusion, a number of observations were made regarding where things stand at Schiphol:
- The size of offices at the airport city is declining
along with demand; - Rental prices are reducing to attract more tenants, but while they have declined, overall office demand at Schiphol CBD has remained relatively solid;
- More people than ever are working from home in the Netherlands, at least for part of the week. In contrast, some days are so busy that car parking is inadequate — it is difficult to get the balance right;
- Prices are available for rentals from just a few square meters, and they can be very short term, from a month down to a day if need be; rentals start from €160, and the typical rate is €230.