An interview with George Casey, Vantage Airport Group
Over the last 25 years, Vantage Airport Group has been involved with more than 30 airports worldwide, working on a wide range of airport development, redevelopment, management and investment projects. With this in mind, we asked Chair and CEO George Casey to talk about the latest projects Vantage is working on, and to share the secrets to the organisation’s success and what challenges he’s facing even after his 30+ years in the airport sector.
We have a few projects going on in the United States, but I’d like to highlight a couple:
We are managing the redevelopment of LaGuardia Terminal B. This is a long-term concession where Vantage has been operating the terminal while leading the almost $5 billion redevelopment project at the same time, along with being an equity investor in this project with our partners. We’ve been doing this since June 2016, with the Port Authority of New York and New Jersey as the main sponsor of the project.
It’s one of the largest public-private partnerships and largest infrastructure redevelopment projects in airports in the US, so of course, we face a number of complexities. You have approximately 15 million passengers going through just that terminal every year on a very small footprint. It takes a lot of stakeholder co-ordination, communication, and on-going focus on safety and security, all while dealing with general passenger requirements, peak hour operations, and integrating construction into all of this.
This is a multi-billion dollar project, and to keep it on schedule and within budget, we were able to develop a design and approach to operations that allowed as much certainty as possible in delivering such a complex project. Working with the design-build joint venture, we came up with something innovative that had never been done before. We opened up the first concourse at the new terminal last year.
Working with the Chicago Department of Aviation, the other project we are really excited about is leading the commercial redevelopment of Midway International Airport. We formed a first-of-its-kind partnership with two key stakeholders in the food and beverage and retail space.
This is a substantial redevelopment programme, with the consortium’s nearly $75 million investment. The first phase of the redevelopment program has been delivered and we are seeing a better product offering and better passenger experience.
Vantage has also been chosen as lead developer by JetBlue for the development of its international terminal facilities at JFK, a multi-billion dollar program that is part of the Governor of New York’s overarching transformation of the airport. This will serve JetBlue’s growth, along with other airlines.
This programme is very similar to LaGuardia in its scope; it is another terminal, apron, airside, roadways development project, which will be undertaken over a five-to-six-year period. And similar to LaGuardia Terminal B, we are the lead investor and developer, along with being responsible for the management of the new facilities with our consortium partners and JetBlue.
One other project I’d like to mention, because it is very different for us, is our partnership with the management team at Denver International Airport, to further explore the passenger experience and innovation. We see this as a very exciting endeavour, which gives us the opportunity to work with the Denver team on key initiatives that will have an impact on how airports approach enhancing the overall passenger experience and leverage innovation.
So there are the three redevelopment projects that we’re at the forefront of and currently underway in the US, plus another focusing on passenger experience.
We’ve been involved with over 30 airports, and one thing we’ve learned is that when you have seen one airport, you have only seen one airport. What we’ve been able to do is to bring our partnership approach to local markets and environments to help with initiatives that allow owners, sponsors, airlines and others to develop the airport into a competitive and best-in-class facility.
One of the key characteristics in making these projects successful is defining objectives – objectives that are beneficial for the sponsor, whether that’s a port authority, the city, county, or government. You need to define what you want for the airport programme, the structure and partnership.
Then, you need to find a way to leverage the best practices of the private sector in meeting those objectives, while understanding that the public side still has a role. So it’s finding that sweet spot where the objectives of the public sponsor meets private sector expertise.
One thing that we have learned is that even with defined objectives and solid planning practices, the dynamic nature of our market demands flexibility, which challenges you to look at things in a new way. Even with a structure, which you generally adhere to, you have to be flexible, innovative and creative. You have to build a degree of transparency and respect, which will allow the partnership to work. That way, when you are facing a new challenge or opportunity, the trust you’ve built will support your efforts.
In addition, there needs to be a balanced outcome. We’ve been involved in projects that start with an imbalance in the allocation of risks or implementation, but have worked to reach more of a middle ground where each party’s strengths are leveraged. This is key.
Our experience has also taught us that thinking about success means thinking about key stakeholders that are involved. Not just those who are at the table, but those who had a vested interest in the operation, the facilities, and the commercial endeavour. So we need to think broadly when balancing outcomes, how the project impacts various stakeholders and involve them in the process as much as possible – that is part of our success.
This is actually what’s really exciting about what we do, because these projects and negotiations are never the same. It’s all about having experience and fortitude to focus on the objectives that the sponsor has set out, to work through their procurement process, and to understand what they’re trying to achieve.
At times, it had been very interesting, for example, when there has been strictly prescribed procurement processes or solutions based on previous years of studies. But the market in that time had changed rapidly. A company like Vantage can bring flexibility, innovation, and a nimble and entrepreneurial approach to help address the complexities they’re facing and change the thinking around solutions or approaches.
Also, we have found that key to a project’s success is a strong partnership with the airlines that operate out of that particular airport or terminal. LaGuardia provides a good example of the importance of working with the airlines to build consensus and to understand what the project meant for them. For one, Terminal B is a highly orchestrated operational environment, so what the redevelopment means for airlines’ operations is crucial. Airlines also have a commercial perspective on this, and need to know about the financial impacts and the potential shared benefits.
Given that the airlines at Terminal B were not part of the procurement process, once we were selected as preferred bidder we had an initial challenge to work with the airlines, under a tight timeline, to reach agreement on approach and structure. I credit the airlines for committing to the process and timeline to get to an outcome that allowed the project to be financed under very favourable conditions. Lots of late nights and long sessions, but it was, I believe, to the benefit of the parties and the project.
Quite simply, the answer is yes. We’ve taken our 25 years of experience from Canada and abroad into the US market, where we’ve seen more activity for companies like ours recently. Where we are today and the projects that we’re involved in demonstrates that our experience and capability translates.
We have to understand, though, that projects may be implemented in different ways in the US market, so we have to remain flexible and innovative in dealing with the roles that key stakeholders play in the US market. That could be the FAA (Federal Aviation Administration), the TSA (Transportation Security Administration), the airlines, local authorities, cities, or municipalities.
One thing that is common in all of our airport projects is a focus on safety, security, and abiding by the regulatory regimes. That has been fundamental to our company since the start.
Collaboration and transparency are key when you run a process to facilitate investment or enhanced management or the delivery of facilities. Putting together the right commercial deal structure that addresses financial outcomes and risks is essential.
Yes, absolutely. It always starts with objectives and goals, and then alignment in partnership structures. In the airport industry in particular – and this is different from other sectors in infrastructure – a pre-defined model on how something was done before and how it should translate over to an airport doesn’t typically work, because each project is different.
We are not only a financial investor, but we are also a manager and developer of airports. We think that this is a very strong combination, because it gives us a much broader perspective which helps in putting deals together and managing outcomes and risks.
Sharing perspectives is really important at a conference like GAD Americas. I am really excited to be on the panel with the representatives from the Chicago Department of Aviation and the airlines to talk about airport development in Chicago.
George Casey, CEO, Vantage Airport Group