Report examining 31 U.S. airports shows Milwaukee Mitchell International Airport could be worth between $473 million and $675 million via a long-term lease to private airport companies and investors.
Milwaukee County could generate $675 million by leasing Milwaukee Mitchell International Airport, giving the county money to fund other needed infrastructure projects or pay down debt, according to a new Reason Foundation study of U.S. airports. Based on data from previous airport sales and long-term leases around the world, the Reason Foundation report shows the airport could be worth between $473 million and $675 million via a long-term lease to private airport companies and investors. After paying off $161 million in airport bonds as federal law requires, the county could net $514 million from leasing Milwaukee Mitchell.
The county could put that money towards modernizing existing infrastructure such as aging roads and bridges, funding new projects in its long-range transportation plan, or paying down existing debt.
“Many of the world’s best airports are already managed by private companies under similar arrangements, including London’s Heathrow and Gatwick, Athens, Copenhagen, Paris, Rome, and Sydney,” said Robert Poole, author of the report "Should Governments Lease Their Airports?" and director of transportation at Reason Foundation. “The long-term lease would be a public-private partnership that would completely protect Milwaukee County and air travelers by setting specific customer service and performance benchmarks that must be met by the private partner. It would also lay out specific maintenance, upgrades and other investments the company would have to make throughout the lease.”
In July 2021, an unsolicited $17 billion offer to buy Sydney International Airport, Australia’s largest airport, was made by a group of infrastructure investors. Despite the airport’s traffic still being a fraction of its pre-COVID-19 levels, the offer was 26 times the standard multiple of Sydney’s pre-pandemic cash flow. The Reason Foundation study used a 20-times multiple in its “high” value calculations for U.S. airports like Milwaukee Mitchell International. The news from Australia suggests that infrastructure investors value airports for their long-term prospects, and that the county could get the high-end value —$675 million—in the Reason study or perhaps even more.
The Reason Foundation study analyzed 31 large and medium U.S. airports, finding Los Angeles International Airport could be worth over $17 billion; San Francisco International and Dallas-Fort Worth International Airport could each be worth more than $11 billion; and Chicago O’Hare International Airport could be worth more than $10 billion.
