SPECIAL REPORT: INVESTING IN AIRPORTS
Shopping, anyone? Joe Bates reports on the rise of the airport shopping mall and talks to Westfield and AIRMALL about the appeal of aviation and their future development plans.
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uch is the popularity of shopping and dining at airports that gateways such as London Heathrow and Amsterdam Schiphol have been referred to as ‘shopping malls with runways” for over a quarter of a century. Dubai International Airport has long been known for its duty free offerings and, in recent years, airports across the globe have become increasingly innovative in terms of their retail and F&B offerings in a bid to boost their passenger appeal and revenues. One of these, Frankfurt, lays claim to operating the biggest shopping mall in Germany while Minneapolis-St Paul International Airport (MSP) has a direct light rail link to the Mall of America, which continues to be a huge attraction for visitors. MSP incidentally has its own highly successful concessions offering, which regularly wins ACI-NA’s award for the best concessions programme in North America and brings in revenues of around $175 million per annum. In some cases airports have actually turned to shopping mall operators like Westfield to manage and operate their concessions programmes. Indeed, Westfield has retail/F&B concessions at Boston Logan (Terminals A and C), Chicago O’Hare (Terminal 5), Los Angeles International Airport (Terminals 1,2,3,6 and Tom Bradley International Terminal), Miami, Orlando (Main terminal), New York JFK (Terminal 8) and Newark Liberty (Terminals A and B) airports in the US and is currently investing hundreds of millions of dollars on revamping its offerings at LAX. At the last count all of this added up to more than 480 retailers encompassing 450,000 square feet of retail and F&B services that generates around $750 million in annual sales.
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AIRPORT WORLD/FEBRUARY-MARCH 2017
Meanwhile, Fraport-owned retail specialist AIRMALL operates the concessions offerings at four US airports – Baltimore/Washington, Boston Logan (Terminals B and E), Cleveland and Pittsburgh. It also signed a contract with JetBlue last summer to manage the concessions programme in Terminal 5 at New York’s JFK International Airport. So what is the appeal of airports to Westfield and AIRMALL? “Westfield has been in the airport business for more than two decades, and it’s exciting to see the transformation that’s taking place,” says Dominic Lowe, executive vice president of Westfield Airports. “According to recent data, US airports have over $100 billion in infrastructure needs over the next decade, so there’s an opportunity right now to completely transform the travel experience. “We’re working with great partners across the country who share a vision to enhance the experience and provide a more holistic journey. A great experience means greater customer satisfaction, improved competition and higher revenue for our partners.” While AIRMALL’s new president and CEO, Ben Zandi, says: “Airports have tremendous appeal to AIRMALL. It’s all we do! “As a division of Fraport, one of the largest airport operators worldwide, we understand passenger and airline needs and are committed to continuously improving the customer experience at airports. “Airports are the first and last vision of the region. We take great pride in delivering an authentic ‘sense of place’ through our innovative offerings that deliver on our promise to travellers and our airport partners. “We are incredibly excited for the future of air travel and the innovations that are transforming the industry.”