Business

Airport eyes new airline, commercial development

Seeking ways to revive passenger traffic at Columbus Metropolitan Airport and fund infrastructure improvements, its commission is ironing out details to bring American Airlines back and develop 20 acres of airport property commercially.

If negotiations remain on track, the airport should receive word from Fort Worth, Texas-based American Airlines by mid-summer on whether or not it will resume flights into and out of Columbus. The flights would connect to American's hub in Dallas/Fort Worth, which would give local passengers a gateway to the West.

"The only way this thing falls apart is if we just can't make the numbers work," said Columbus Airport Commission Chairman Don Cook. "They will make a decision in the June or July timeframe. The first plane they said they can put in here would be December 2007."

The numbers Cook refers to are the estimated $300,000 in startup costs American would incur to set up a station at Columbus Metro. The airport would need to make some sort of guarantee that it would pay a portion of those costs should business not materialize as touted by the commission.

Cook said the airport is working on what type of financial "guarantee" it would offer the airline for the startup costs. No ongoing revenue would be guaranteed or subsidized.

"They're concerned about the risk," said Columbus Metro Airport director Mark Oropeza. "That's what it boils down to. What can the community do to minimize their risk exposure."

American Eagle, a regional feeder for American Airlines, left Columbus in the mid-1990s after serving the city for six years. Other airlines — Northwest Airlink and US Airways Express — also have left the market in the last decade.

That left Atlantic Southeast Airlines, which feeds Delta Air Lines, as the city's lone regularly scheduled passenger air service. ASA, which has been plagued with on-time and service issues in the past, now operates four flights to and from Columbus — none on a jet.

Overall, airport traffic has plunged since peaking at about 250,000 passengers flying into and out of the city in 1991. Passenger counts dropped below 200,000 in 1998 and fell under the 100,000 mark in 2005. The number slipped to about 87,000 last year.

That trend means a second airline is crucial to the long-term health of the airport as a transportation hub, Oropeza said. "Obviously, the more passengers you get, then the more successful you can be in recruiting other air carriers," he said. "That's the name of the game."

Cook said airport administrators have been working for 18 months to land American Airlines. The timing appears right, he said, because of the growth Columbus is now experiencing. That includes Fort Benning's troop expansion and more jobs being created by area employers, such as the Kia auto factory being built in West Point, Ga., and Aflac in Columbus.

It also didn't hurt that Delta has been working through a bankruptcy court reorganization for nearly two years. The airline industry as a whole has been under intense financial pressure in recent years because of rising fuel costs and consumer resistance to higher fares. The economic environment has left Delta with a weaker negotiating stance.

"The only reason that we are able to do this is (Fort Benning's expansion) is happening, Columbus is growing, and they're weak," Cook said. "Without that combination, this conversation with American just wouldn't be possible. All of those factors have come together at the right time."

American Eagle, if it does return, would offer two flights daily into Columbus, using regional jets to transport customers to and from its Dallas-Fort Worth hub in Texas. Passengers then would connect with national and international flights.

Commercial

At the same time it is courting American Airlines, Columbus Metro is preparing to turn about 20 of its 600-plus acres of land into commercial property.

The airport commission has selected The Jordan Co., a Columbus-based development firm and commercial property brokerage, to find tenants for the project. Phase one will be about 1.6 acres directly across Airport Thruway from Hobby Lobby and Wachovia Bank.

Prospects for the small parcel include someone interested in building a small neighborhood center with one or two national tenants as its anchors, said David Johnson, associate broker with Jordan Hart Commercial Services.

"The first phase, we're thinking, will take eight to 12 months to get a long-term lease signed. And that is contingent upon the Wal-Mart Supercenter coming out of the ground on schedule," said Johnson, who understands the new Wal-Mart nearby is on pace to open before Christmas.

There is no firm timeline on the second parcel of land, which covers about 12.4 acres between the front entrance of the airport and the radar towers positioned near the intersection of Airport Thruway and West Britt David Road. The land is now used for airport parking overflow and rental car storage.

The remaining six acres of land is unusable either because it's too hilly or the radars are on them.

"The intention is to take the (lease) income generated on site one and use that towards improvements to prepare site two," said Jordan Hart Commercial Services sales associate Frank Walden, who is working with Johnson on the project.

Preparation might include reconfiguring the airport entrance from its current looping in and out design to one that is a straight two-way in and out with a traffic light on Airport Thruway.

Prospects for the larger Phase 2 might include a hotel, Johnson said, while other retail, office and warehouse/distribution are possibilities.

Any leases would be long-term, Johnson said. For instance, at Columbus Park Crossing in north Columbus, outparcel tenants typically sign 20-year leases, while hotels and large retailers or office users require contracts ranging from 40 to 50 years.

"If the airport looks more like a hub for business, if it's got more amenities, including some retail on one corner, more traffic, a hotel, perhaps some office space and restaurants, that tends to generate more activity," Johnson said of the project's potential impact on Columbus Metro.

Aside from the airport entrance, other improvements are likely to include new hangars and other buildings that serve airlines and private aircraft. Oropeza said no lease income figure for the airport has been formulated simply because different tenants would pay different amounts.

But it's a good deal, he said, because the 20 acres being developed now are vacant land.

"We can't get an airplane to it," Oropeza said. "Its highest use is definitely not being generated right now. So it's a way of generating some additional revenue for the airport to keep ourselves as self-supporting as we can."

Columbus Metro Airport's annual budget is $2.7 million.

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