Coordinating Efforts: In Detroit, cities, airports meet

Special Report

Coordinating Efforts

In Detroit, cities, airports meet

By Jodi Richards

November/December 2004

DETROIT —The Airport Cities Conference & Exhibition,organized by Insight Media Ltd., was held here in early October. The two-dayconference brings together airports, community economic development groups,as well as privatedevelopers to discuss the benefits from creating an airport city through partnerships and growth opportunities.

The fall sessions were hosted by Wayne County, which touts its airports as leading job generators with unique opportunity for growth, according to Wayne County executive, Robert Ficano. Following the completion of the McNamara Terminal at Detroit Metropolitan Airport, Ficano says, the next step for DTW is creating an airport city.

As conference chair Dr. John Kasarda, director of the Kenan Institute of Private Enterprise, Kenan-Flagler Business School, University of North Carolina-Chapel Hill, explains, an airport city is created when “all the functions of a modern metropolitan center are located on and immediately around an airport.

“Airports are much more than aviation infrastructures; they have really become mini-cities.” He adds that airports are multimodal, multifunctional enterprises which generate development well beyond their boundaries. “The airport has become a destination itself — a city where people work, shop, eat, etc.”

Karsarda adds that it is critical that communities keep in mind that growth spurred by the airport does not stop at the airport boundaries. This leads to another concept, that of the aerotropolis, which he explains as the development that forms along the major arteries that lead to the airport. It includes business parks, logistics parks, hotels, retail, residential communities, and more.

Growing Airport Cities
Lester Robinson, CEO Wayne County Airport Authority, says DTW has grown 1.5 times faster than the national average pace and is forecast to have one of the lowest airline costs per enplaned passenger by 2008, at $8.08. With 6,700 acres on the airport, Robinson says the challenge facing the authority is “what do we do with the property around us” in order to achieve thoughtfully planned development that is offered by creating an aerotropolis.

One of the fastest growing airports in the world is Dubai International Airport, also striving for the airport city model. Aeronautical revenue for the Dubai airport is very low, says Anita Mehra Homayoun, director of marketing and corporate communications, Department of Civil Aviation, Dubai, UAE. “Non-aeronautical revenue made up 63 percent of the 2003 overall revenue,” she says.

Duty free shops provide the highest revenue at the airport, while advertising contributes a considerable amount as well. “Selling signs in the terminal generates more revenue than the car park,” says Homayoun.

According to Doug Rothwell, executive director of economic development for Detroit-based General Motors Corporation, “We believe economic development is in our best interest. If the communities we operate in are not vibrant, that reflects poorly on us. Airports are critical economic development assets.”

Private Development
Steven Bradford, principle airport facilities development team, Trammell Crow Company, presents some considerations for the development of an airport city. He says diversification within the airport community is critical. “The greater the diversification, the greater the synergies.” He also suggests to airports that they “create a business-friendly environment. Make it easy to do business at your airport.”

Bradford advises airports to posture themselves so as not to compete with the private sector because the “private sector views the public sector as having a crushing effect.” The private sector can be a good influence on airport development, he adds. “Private entities can make the investments or risks the public may not be willing or able to take.”

Airports should take a long-term perspective when looking at the development of an airport city, says Bradford, keeping in mind that ground or vertical leases revert back to the airport at the end of their terms and “buildings that are built on your property should be multi-purpose.

“Growth is going to happen at your airport — be in front of it so you can direct it.

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