Capital Works Continue At Sangster Airport As AAJ Looks To Post COVID-19 Gains

Capital improvement works are proceeding apace at the Sangster International Airport (SIA) despite the fallout in the global airline industry resulting from the downturn in activity due to the coronavirus (COVID-19) pandemic.

The projects, which represent investment of approximately US$170 million, include expansion works under a master plan programme and a runway expansion project.

President and Chief Executive Officer (CEO) of the Airports Authority of Jamaica (AAJ), Audley Deidrick, tells JIS News that the travel and tourism industries have, by far, suffered the most significant impact from the COVID-19 pandemic.

AAJ owns the island’s two international airports and provides oversight and contract administration for the concession agreements, which are in place for the operation of each facility.

Mr. Deidrick says the Airports Council International (ACI), in its Advisory Bulletin published on December 8, 2020 had projected that the global airport industry would record a reduction of more than six billion passengers by the end of 2020, compared to the pre-COVID-19 forecast for the year, representing a decline of 64.2 per cent of global passenger traffic.

Markets having significant domestic traffic are expected to recover in 2023 to pre-COVID-19 levels while markets with a significant share of international traffic are unlikely to return to 2019 levels until 2024.

Locally, the total airport traffic for 2020 is expected to decrease to 2.3 million or by 65 per cent, with SIA expected to post 1.6 million passengers and Norman Manley International Airport (NMIA), 650,000 passengers.

This is a significant decline from pre-COVID-19 passenger traffic of 6.5 million, with SIA posting 4.7 million and NMIA 1.8 million.

Mr. Deidrick says that recovery is expected to be sharp in 2021 with SIA projected to post thee million passengers, and one million by the NMIA, representing increases of 65 per cent and 55 per cent, respectively.

However, due to the wider economic and other factors that drive Jamaica’s international passenger traffic, the recovery to pre-COVID levels is not expected until 2025/2026.

Despite the downturn in traffic and revenues, Mr. Deidrick says that the airport concessionaire is pressing ahead with many of the planned improvements under the master plan, which is required every five years in response to current and future growth forecast.

“So they had done a master plan, which calls for major expansion of the terminal, the car park, realignment of roadways on the air side and access to the airport,” he says.

The master plan was approved in 2019 and was expected to begin in 2020, but activities were put on hold due to COVID-19.

Works under the programme, which amount to over US$100 million, is separate from the runway expansion project, which started in 2019, and is being undertaken at a cost of US$70 million.

That runway expansion, he said, is significantly advanced and is forecast for completion by the end of 2021 into the first quarter of 2022.

As it relates to the master plan, Mr. Deidrick says that some elements of the programme have already started.

“They had gone ahead to construct 7,000 square metres of additional circulation space and retail concession space in the departures terminal. That work is significantly advanced and should be completed around August of this year,” he notes.

Mr. Deidrick adds that the management of the airport has also implemented a solar power system, which will provide significant power supply to the airport at a cost of US$1 million.

The installation is expected to be completed by August.

The AAJ President and CEO tells JIS News that there are other elements of the master plan that have to do with the expansion of the terminal building, that the concessionaire, because of COVID-19, has asked AAJ to consider granting approval for deferral, until the traffic growth that is forecast, becomes a reality.

“Nonetheless, they are doing major works on the south terminal in the apron area, and the roadways in that area. We will also see a situation where it can facilitate powered parking and exit of aircraft from that area [using their own engines instead of being tugged],” he informs.

“So all these works are continuing. The only ones that are not continuing right now is the stretching of the terminal building to accommodate greater space internally in terms of immigration, customs and the transportation halls,” he adds.

Mr. Deidrick tells JIS News that the concessionaire has been able to undertake the capital works, despite the downturn in traffic and revenues, because of reserves that they would have built up prior to now and loan of some US$60 million from the Bank of Nova Scotia.

He indicates that the runway extension of US$70 million is not being financed directly from the resources of the concessionaire, but rather by the Airport Improvement Fund, which is a fee collected on passenger tickets to fund capital development programmes at the airports.