Two Bahamas-based companies with international partners are expected to be among the bidders for the manager/operator contract at Nassau International Airport (NIA), as the Government seeks to upgrade the facility through constructing a new $250 million terminal building.
Idris Reid, general manager of the Airport Authority, yesterday told The Tribune the Government was hopeful it would attract a management team with experience in international operations. The successful bidder would be able to develop the airport into a facility that would complement the Bahamas’ position as the top tourism destination in the Caribbean.
Mr Reid added that there would also shortly be an announcement regarding runway repairs at NIA. Engineering reviews had been completed and, with the contracts being finalised, a decision is expected by next week.
The deadline for submitting bids for the NIA management/operator contract is April 5, and Airport Authority officials have given themselves until June to review the submissions before making a selection. The Airport Authority will continue to own NIA, which will be leased as a managed entity to the successful bidder.
The Tribune previously revealed that among the likely bidders is YVR, the entity that manages and operates Vancouver International Airport.
Vancouver International Airport, which is Canada’s second busiest, handling some 14.3 million passengers and 232,200 take-offs and landings per year, has created a subsidiary, Vancouver Airport Services (YRVAS), that operates 14 airports in five countries, including in Jamaica and the Dominican Republic.
It is thought that if YRVAS became involved in managing and operating Nassau International Airport it would be as part of a consortium, similar to the arrangement it has in the Dominican Republic.
However, The Tribune understands that YVR faces possible competition from rivals that could include the company managing Singapore airport, which handles more than 60 million passengers per annum through its three terminals.
And sources have told The Tribune that another possible bidder is the giant US conglomerate, the Bechtel Corporation, a civil engineering giant that handles giant infrastructure and engineering projects, including the rebuilding of Iraq and the Channel Tunnel between the UK and France.
Bechtel is currently heading a consortium that is operating and developing Jorge Chavez International Airport in Lima, Peru, under a 30-year deal with the Peruvian government.
Bechtel, though, has been the subject of much controversy relating to its business practices and alleged links to the US intelligence services and the Republican party. George Shultz, Ronald Reagan’s former secretary of state, serves as a board director, and Bechtel has numerous alleged connections to other leading Republican functionaries.
Mr Reid yesterday told The Tribune that using the results gained from a master-plan consultation conducted a few years ago with Orlando firm Birk Hillman Airport Consulting Services, the Government wants a management team that will target key areas of the airport to bring it up to the level of other Caribbean airports.
Continued maintenance and repairs to the runways and the construction of at least one new terminal building – possibly in conjunction with the Government – are the primary areas the Airport Authority wants addressed.
Officials are also looking for a bidder who will develop and implement a strategic plan for the use of the entire facility, which may include broadening the existing retail space to introduce more shopping opportunities, a wider variety of restaurant and lounge facilities and perhaps the inclusion of more commercial entities, such as a bank.
Mr Reid said the Airport Authority is prepared to look at whoever comes to the table and, based on their ability to execute the overall plan, a management team will be selected.
Jeremy MacVean, president of the Bahamas Hotel Association (BHA), said yesterday that the state of NIA had long been a source of concern for Bahamian hoteliers, since the facility served as both the first and last impression tourists have of the country.
As it stood, NIA was not a particularly attractive airport and, from a departure standpoint, the fact that there was a lack of retail opportunities meant the Bahamas was missing out on revenue from the last-minute purchases visitors could be making.
Airports were increasingly being managed by private companies that had experience to turn the facility around from a financial standpoint. Kerzner International, with its Phase III project awaiting improvements to the airport, earlier expressed great concern over NIA’s condition, and included its upgrade as a condition in its Heads of Agreement with the Government. The quicker the Airport Authority is able to bring a management partner on board, the more enticing it will be to major investors and tourists.
Michael Hooper, the British Colonial Hilton’s general manager, said improvements to NIA were an essential ingredient for the Bahamian tourism product. He said most in the industry felt NIA did not match up to airports in competitive destinations in the Caribbean, and some of the larger players had publicly commented on its very poor condition, urging the Government to address the situation.
Mr Hooper said that in order to remain competitive, NIA must be developed into a first class entity, and the move by the Airport Authority to bring in a professional company with international experience was the first step towards achieving that goal.
The main requirement, Mr Hooper said, was that regardless of which management team won the contract, they needed to have full operational control on a daily basis and be given the authority to make quick decisions at any time.
Ralph Massey, a director of the Nassau Institute, also pointed out Sol Kerzner’s insistence on the upgrade to NIA, adding that it was absolutely essential to the development of the Bahamian tourism product. He said: “The airport is what any tourist sees going in and out. Especially if they compare the airport with the one at the destination where the tourists come from, they can’t help being struck by the difference between Nassau and anywhere else.”
Admitting that he was not intimately involved in the process or aware of the Airport Authority’s agenda, Mr Massey said the real question the public should focus on was, that if the Airport Authority hired an outside group to manage the facility, what degree of leeway will the management group be given in its efforts to tackle all the problems being experienced at NIA?
Mr Massey said NIA had suffered its fair share of public failures, including the installation of two jetway fingers to service American Eagle aircraft that were not in use and appeared to not be working. The upkeep of the bathrooms and the baggage claim areas had been ongoing problems for both the Bahamian tourist and visitor alike.
Speaking on condition of anonymity, an investor told The Tribune that NIA was failing in comparison to other airports in the region, pointing to Barbados and Trinidad, both with relatively new facilities, while the Cayman Islands and the Turks and Caicos had comparatively more modern operations.
The source noted that during hectic periods NIA was not conducive to the destination the Bahamas wanted to promote itself as. It was difficult to offer an Atlantis or to promote the Bahamas as a top destination and then have visitors come in and their first image was the airport.
The Airport Authority’s decision to bring in an experienced management team should be viewed as good news, the source said. With the development of a strong retail base, an area the private sector sees as a necessary addition for making time spent at NIA more attractive and increasing revenues across the board, will allow the facility to become commercially viable, particularly as airports are not cheap to maintain or maintain.
One of the headaches faced by the Government was that in the Family Islands, foreign investment in the tourism sector also came with a $20 million price tag and the need to develop an airport. With the Bahamas’ unique geography, this problem did not exist for other destinations in the Caribbean. A country of almost three million, Jamaica, had two airports, while the Dominican Republic, with nine million people, had two airports and was building a third, and the Turks and Caicos Islands had one aviation facility.
The source said: “The pre-clearance lounge offers an enormous advantage for us and we have the potential for all kinds of things in the aviation field. Thank goodness we’ve got to this stage. They’ve known that the runways needed to be repaired for some time, even the Federal Aviation Authority (FAA) was getting quite serious.
“This is good news. With the development of Kerzner International and resorts, we need a good airport.”
By Yolanda Deleveaux, The Tribune
