Revitalizing Farnborough

Jan. 8, 2005
Farnborough International Airport, located south of London, attracts aviation enthusiasts here every two years for the Farnborough International Air Show.

FARNBOROUGH, U.K. -- Farnborough International Airport, located south of London, attracts aviation enthusiasts here every two years for the Farnborough International Air Show. Once a leading military research and
development airfield, Farnborough enters a new era with private investment from TAG Aviation, which owns and controls more than 160 business jets and is a part of TAG Group S.A. The goal: Make the airport England's premier business aviation facility.

According to Len Rayment, director of FBO and business development, Farnborough has been "an airfield of some description" since 1907. Most famously known for its biannual international air show, last held here in July. Until the early 1990s, the airfield was a government-owned research facility involved with "just about every form of military aviation development you could imagine," says Rayment.

He explains that in the ?80s the British government decided to dedicate Farnborough, one of three research and development airfields it was operating, to business aviation. A 50-acre site on the south side of the airfield went out for commercial tender. A civil enclave was established in 1989 by Carroll Aircraft, whose holding company, The Carroll Group, went bankrupt in 1995.
In 1999, operation of the airport was once again put out to tender to be operated as a business aviation facility. TAG Aviation submitted a successful bid and entered into a 125-year lease of the airfield, subject to obtaining planning permission and a CAA (Civil Aviation Authority) license.

"It was impossible to get a complete, accurate forecast of what it was going to cost to achieve the CAA license," says Rayment. The process to convert the airfield from its previous Military of Defense license to meet CAA regulations involved building a new $15 million control tower, reprofiling the runway, adding hangar space, installing approach aids, and a radar system. "CAA regulations are much more stringent than had previously been applied by the Military of Defense," adds Rayment.

According to Ann Bartaby, TAG Farnborough director of operations and development, each process required separate approval, making for an intense 18 months.

Says Rayment, "It had to be a very dynamic and forward thinking private company to take on that."

Another challenging aspect of converting the airfield: environmental considerations. Bartaby says the entire airport site is designated as a site of nature conservation interest by the government, with some of the airport designated as a site of special scientific interest. Moving trees and protected grass, rerouting a stream, and protecting wildlife was all done in conjunction with English Nature, Britain's conservation organization. Additionally, TAG Farnborough now has an environmental officer located on site.

Bartaby explains that the community had some doubts about the airport being operated by TAG Aviation, but the organization's efforts to be open and involved with the community have eased those. "In 2000 there was a lot of suspicion about TAG. That's changed hugely now. They (the community) can see what we've done with the site and that there's not a tremendous increase in traffic." Bartaby adds that it "makes good business sense" to have such a partnership with the community and to "show them that we're protecting the environment."

Noise monitoring equipment was also installed at the airport. While not a requirement by CAA, says Rayment, airport officials saw the importance of the investment in terms of community relations. "We put all this in voluntarily," Rayment says of two stationary systems and a mobile unit. "But it all added to the cost that we really didn't expect."

Commitment to Bizav
According to Rayment, TAG's interest in operating Farnborough grew out of its desire to establish an "international group offering quality aviation across the board. They could see from their involvement in aviation that there was a major deficiency in business aviation in the London area."

The lease on the airfield is a straightforward lease, explains Rayment, that "might as well be a freehold. We don't pay very much in terms of ground rent; it's a peppercorn rent. For that peppercorn rent, we've rebuilt the airport."

There are stipulations in the lease stating that the 600-acre airfield must be operated as a business aviation airport. "In effect, in two years we can't say, ?no this isn't working as a business aviation airport.'"

In late 2003, TAG purchased the maintenance facility on the field operated by Les Batty and now known as TAG Farnborough Engineering. Batty has been operating at Farnborough since 1991. "We knew we wanted a quality engineering/support facility on the field," explains Rayment. "Not because we make a lot of money out of engineering, but because we need the support on site. The company that was here was a one man business that really needed investment to develop it." The maintenance facility is responsible for some 15 percent of TAG Farnborough's annual revenues.

In addition to the maintenance facility, TAG also operates the FBO, which sells some 20 million liters (approximately 5.28 million gallons) of fuel annually. There are some 35 tenants on the airfield, primarily aircraft operators, including charter brokers.

There are some 40 based aircraft at Farnborough, which has a single runway, 2,053 meters (approximately 6,734 feet) in licensed length. A ban on stage 2 aircraft does limit the traffic, but Rayment says this is not to the detriment of the airport. Farnborough is also a by-request only airport. "Farnborough has a private use license," says Rayment. "Which basically means it's a private facility. You cannot bring your aircraft here unless we say you can. We're not allowed to have scheduled services, inclusive tours, handle freight, or have a flight school." Rayment is quick to add that "we don't want any of those. We didn't contest any of those issues because they're not part of our commercial business plan. We had no problem whatsoever in agreeing to those conditions of the local authority."

Currently, Farnborough handles some 18,000 movements annually, and has the capacity to handle 28,000 annual movements, Rayment says.

Future Development
Similar to the stunning new control tower, other development on the airfield by TAG are not only functional but aesthetically pleasing as well. Explains Rayment, "As we started the development, we looked at things from a slightly expanded perspective. We decided that if we were going to put up new hangars, we really didn't want to build the old, traditional, square box hangars. We wanted to build something that would create an impression."

A new 50,000-square foot terminal building, expected to be complete by the end of 2005, will follow similar design elements of the hangars and control tower. The wing-shaped building will house a passenger lounge, meeting rooms, airport administration. Half of the new building will be leased to aviation-related tenants.

The airport also has planning permission and design approval for another three hangar bays, which would add 100,000 square feet. "That construction will be dependent on whether we can realistically see that there is enough business to fill it," says Rayment.