KISSIMMEE, FL — Despite the impacts of 9/11, the 2004 hurricane season (three hurricanes in six weeks), and the recent fuel spike and economic recession, the last decade has been a period of consistent growth for Kissimmee Gateway Airport (ISM). With the installation of an instrument landing system and more than 200,000-square feet of hangar, office, and fixed based operator facilities built since 1998, director Terry Lloyd continues to look for ways to enhance the airport’s capabilities and, in turn, increase both recreational and business aviation activity.
Built during World War II as an Air Force base in 1942 and located just eight miles from Walt Disney World, as well as minutes from numerous convention hotel properties in the Southwest Orlando Metro area, Kissimmee Gateway Airport is “in the midst of a building boom,” says director Terry Lloyd.
With a T-hangar development, a new fuel farm, a 6,000-square foot flight school hangar, and another 10,000-square foot hangar all under construction, the general aviation airport still has the largest stock of vacant aviation property in the greater Orlando area, says Lloyd, and as Orlando grows, “so shall we.”
Prior to Kissimmee, Lloyd was on active duty in the Air Force for more than 20 years working in airport management and aviation operations. No longer an active pilot, Lloyd has been the director of aviation at ISM for eight years. With many of the short-term plans for the airport’s development nearly complete, Lloyd is now focusing on weathering the economic downturn and planning for the long-term which could include a U.S. Custom’s terminal and an increase in air cargo operation capabilities.
Flight activity and fuel sales are down roughly 5-10 percent, says Lloyd, and for planning purposes, an estimated 25 percent decline is projected for 2009.
“The industry has taken a double hit with high fuel prices last year and the recent negative perception aimed at corporate flight travel. Now the general problems with the economy are compounding that,” says Lloyd.
Fuel sales have been hit hardest; yet fortunately for ISM, says Lloyd, a newly installed ILS system has allowed the airport’s major FBOs to attract more based customers. Currently, more than 200 aircraft are based at the airport. The majority of ISM’s corporate traffic is transient, and the airport doesn’t house any corporate flight departments.
Of some 155,000 total annual operations in 2008, corporate aircraft made up more than 3,500 of those operations. The business aircraft economic impact, however, is entirely disproportionate with the smaller planes. With two flight schools on the field, flight training contributes heavily to the total flight count.
According to Lloyd, the airport generates an annual revenue of $900,000. The airport is a city department which operates without any tax revenue, and has been able to do that for the last 15 years. “The city was very proactive in keeping the airport open and making improvements; it got to a financial point where the city didn’t need to subsidize the airport,” says Lloyd.
“That’s not an easy task to do with a general aviation airport. Obviously that’s tied to our location in Orlando.”
An FAA study found that the airport’s “estimated economic impact” is $51 million annually. “We are able to generate a lot of economic activity through the airport,” says Lloyd.
Kissimmee Gateway is growing with private dollars and Lloyd relates that he likes to think of the airport as running very much like an entrepreneurial small business.
“These are lean growth years,” says Lloyd. “But ten, 20, or 30 years down the road, the airport will be able to lease out facilities constructed with private dollars, giving us more money to work with.”
Impact of state grants
The state of Florida has an effective aviation grant program, relates Lloyd. Florida takes state tax money on aviation fuel and diverts the dollars to a trust fund. The state then makes grants available to airports in much the same way FAA allocates Airport Improvement Program funding.
“Florida runs a very proactive state aviation office,” says Lloyd. “We’ve been able to build three large hangars; the grants were made available to the FBOs, and they matched the grant funds dollar for dollar.”
A bank of 66 T-hangars, leased by Sheltair Aviation Facilities, was built in 2002 using the same method of funding. Ranger Aviation, aligned with Atlantic Aviation, built its facilities without accessing the state aviation grants. The facilities consist of seven 10,000-square foot hangars including office space, and two 18,000-square foot hangars. The airport is charged with building and maintaining ramp infrastructure while Ranger leases the land and develops the facilities.
Negotiations have begun with one of ISM’s two flight schools to lease FBO property and match state grant funds for construction of a flight school and hangar facility, says Lloyd, and plans for a future Business Air Park are also in the works. The Air Park will consist of ten to 12 aviation development-ready parcels, one to two acres in size, and is expected to be completed in 2011, according to Lloyd.
The next big goal for Kissimmee Gateway is to bring in U.S. Customs and attract international traffic.
“I always have one far-reaching goal that people are looking to me to complete; for my predecessor, it was an ATC tower. My first was getting the ILS system in. Next is to accommodate and attract international traffic,” says Lloyd.
The funding is the tough part, relates Lloyd. Airports are required to fund Customs up front, build traffic, then recover the costs. Kissimmee Gateway doesn’t have the airport revenue to devote to bringing in Customs currently, but a private partnership could speed up the process. Lloyd still considers the initiative a long-range goal because everyday operations and airfield maintenance take priority.
Another long-range plan for Lloyd is to increase the airport’s capacity for air cargo operations. He says he would have a niche market for handling high-end air cargo because Orlando Int’l operates high-volume cargo operations.
“When I look at what a general aviation airport can do, one thing we could do more of is air cargo,” says Lloyd.
Lloyd’s predecessor began the airport’s advertising campaign around 1997, when the control tower was constructed. A marketing consultant, who is still with the airport, identified a two-part marketing plan: 1) corporate traffic as a target market; 2) partnership with the local Convention and Visitors Bureau in Kissimmee. The bureau, which collects a hotel bed tax, has a marketing program that has recognized the role the airport plays in bringing people into the area, says Lloyd.
“We get a grant from the Convention and Visitors Bureau for print and web advertising,” says Lloyd. “We also have a generic ad for umbrella marketing; both the airport and the bureau advertise the location of the airport and its capabilities.
“All of our promotional materials are intended to drive people to our website, which has links to all of our airport-based businesses.”
The challenge to marketing the airport in the beginning of the campaign, relates Lloyd, was in making people aware of where Kissimmee is. While most of the convention happenings occur in Orange County, Kissimmee is located in Osceola County, just south of Orlando. “Kissimmee is definitely an Orlando area airport,” says Lloyd. “But we don’t have the word Orlando in our name.
“So we found that the message we needed to get out was to let people know where in Florida Kissimmee is located.”
Thus, the airport’s marketing taglines became ‘touch and go to Orlando’ and ‘closest to the magic of central Florida.”
Kissimmee Gateway Airport is the closest general aviation facility to Walt Disney World, Sea World Adventure Park, UNIVERSAL Orlando, the Orlando-Orange County Convention Center, and just minutes from Central Florida’s major highways.
“Fortunately, the city and county government are interested in the health of the airport,” says Lloyd.
“They are not providing funding, but they are providing positive motivation as well political support.