St. Joe, Southwest end financial agreement

July 03--WEST BAY -- An agreement that would have required the St. Joe Co. to pay Southwest Airlines up to $26 million for any losses incurred for locating to the Northwest Florida Beaches International Airport site is no longer needed and has been terminated, the companies announced Monday.

The deal was initiated three years ago as an incentive to draw Southwest to the airport, which opened in May 2010 and is built on donated St. Joe land. The early termination was effective July 1.

John Wheat, the airport's executive director, said St. Joe did not have to put up any of the $26 million.

"I think this shows that Southwest is doing better than we thought," said John Wheat, the airport's executive director. "This is nothing but good news."

The Northwest Florida Beaches International Airport has grown from capturing 9 percent of the Panhandle market share in 2009 to 25 percent this year, Wheat said.

Southwest has extended its lease agreement with the airport through 2015. Delta Air Lines also operates from the airport, which some residents and officials had complained was constructed too far north in Bay County.

"That was proved to be wrong," Wheat said.

Wheat said he sees only additional growth for the airport over the next few years.

"We think there is great potential in the Midwest, also," he said.

Southwest recently started nonstop service from Bay County to St. Louis. The airline first initiated service in conjunction with the airport's grand opening.

"The financial safety net provided by St. Joe was instrumental in attracting Southwest Airlines to Northwest Florida Beaches International," Bob Montgomery, vice president of airport affairs for Southwest, said in a release. "In every respect, the agreement with St. Joe has been a triumph. It has fulfilled its mission and achieved its intended purpose."

St. Joe owns about 573,000 acres of land, primarily in Northwest Florida, including large tracts of land around the airport.

"We are proud to have played a critical role in securing air service by Southwest to Northwest Florida Beaches International Airport," St. Joe CEO Park Brady said in the release. "Southwest enabled not only increased visitation to our region, but also reduced airfares that are enjoyed by the residents of our local communities."

Below is an earlier version of this story:

WATERSOUND -- The St. Joe Co. on Monday announced the early termination of an agreement with Southwest Airlines in which St. Joe would reimburse the airline for up to $26 million in losses.

The agreement would have lasted for up to three years at the Northwest Florida Beaches International Airport, which opened in May 2010 near West Bay.

"The financial safety net provided by St. Joe was instrumental in attracting Southwest Airlines to Northwest Florida Beaches International," Bob Montgomery, vice president of airport affairs for Southwest, said in a news release. "In every respect, the agreement with St. Joe has been a triumph. It has fulfilled its mission and achieved its intended purposes."

Copyright 2012 - The News Herald, Panama City, Fla.