$50 billion waiting to invest in airports

Competition is set to overheat in the airport privatisation market as cashed up investors holding an estimated $50 billion in funds pursue aviation infrastructure assets in Europe, the Middle East and Asia. The looming competitive battle for airport stakes and opportunities in emerging markets are key themes of the Centre’s “blockbuster” Airport Development 2006 conference, to be held at the prestigious Raffles City Convention Centre in Singapore, from 29 August to 2 September 2006.

According to the Centre for Asia Pacific Aviation’s Executive Chairman, Peter Harbison, the Ferrovial-led takeover of British airports conglomerate, BAA, has “poured fuel on the global airport privatisation fire” - and government sellers of airport assets are likely to be the beneficiaries of this “feeding frenzy”.

“The European market is running hot after the successful float of Aeroports de Paris and this week’s approval by the Dutch Government for an IPO of Amsterdam Schiphol. But many of the investors, including some new names, are circling emerging markets for opportunities, particularly in Asia and the Middle East. The pipeline grows every day”, he says.

“We estimate the 60 leading (active and potential) global airport investors have a combined pool of approximately USD50 billion ready and waiting to invest. We estimate the global airport privatisation pipeline is valued at up to USD40 billion - so competition will intensify in the sector and new entrants may have to pay price premiums to secure seed assets for their airport/infrastructure funds. This is not such good news for the established players”.

“The Centre’s forthcoming Airport Development 2006 event aims to bring together global aviation investors and strategic interests in airport and ANS development. The event will focus on issues confronting the emerging markets in the Asia Pacific, Middle East and Eastern European regions. Growing interest in airports as an investment opportunity highlights the need to share experiences in state of the art finance/investments, regulations & policies, privatisation, retail strategies, latest infrastructure, strategic and new technology requirements for airports in these rapidly emerging markets”, said Mr Harbison.


Airport Development 2006 is organised by the Centre with key partners, including Airports Council International (ACI) and IJK and Associates, supported by Civil Air Navigation Services Organisation (CANSO) and the Singapore Tourism Board (STB).