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Op-Ed: A decision-making tool for choosing an airport developer

A lot of industry experts agree with the Puerto Rico government’s decision to halt granting the operation and maintenance of all island regional airports to a single administrator, that instead, the best option was to look at each airport’s development opportunities.

Soon after this announcement, the administrator of the Puerto Rico Public-Private Partnerships Authority, Fermin Fontanes, said he will continue the negotiations of the single administrator original proposal for all regional airports, but will also explore the industry “appetite” for the development of these airports. 

The goal of the development of these airports is to increase island global connectivity, economic development, and job creation. So, within this context, what would be the meaning of “appetite” for the government of Puerto Rico? What will be the measuring criteria to decide on each airport’s potential?

These questions are important in the present aviation industry environment of contraction and cash preservation.

Does the government have the vision and planning for each one of these airports and expect that a private entity implements and finances them? Or the government is expecting that the private entity provides the vision, planning, implementation, and finance for the development of each airport? I think the latter is the most probable scenario. We have not seen any significant progress on island airports, beyond the privatization of Luis Muñoz Marin International Airport.

Airports as an economic development tool is a means to an end. So, we need to have an adequate infrastructure development at the larger regional airports in conjunction with a facilities operator, bring the airlines that provide cargo and passenger connectivity, and an industrial park master planner around the airport that provides the economic development and job growth we are aiming for.

This scenario seems more like a consortium of companies, more than a single company operating all regional airports hitting on all these sectors at each airport.

Since the government does not have such plans in the hypothetical situation that a consortium comes up with such a development proposal and the financial ability to do it, will the government be prepared to negotiate with them as an unsolicited proposal?

I expect it to be an unsolicited proposal because, against the backdrop of an aviation industry with an overcapacity issue and a very tenuous financial structure, the consortium must create its own path to success, to justify the investment of hundreds of millions of dollars.

Each airport has its unique opportunities and challenges, and we will have a mix of solutions and possibilities for each one. I just hope that the government has the business vision to know how to negotiate each one of them.

Author Jerónimo “Jerry” Léctora is a researcher and writer about aviation and geopolitics issues.

Aguadilla has the potential for being a passenger and cargo transfer hub in conjunction with an industrial-academic park. Ceiba has the same potential as Aguadilla with a strong emphasis as a spaceport. Lower earth orbit is an emerging industry with a potential in the trillions of dollars.

Ponce should develop its potential around the functional consolidation of the southern municipalities to develop as a supra metropolitan region. If the municipality of Ponce joins forces with AV Port or other operators, it could be done.

The smaller airports could be developed in a mix of use for private aviation, aviation sports, or tourism like flight inns and or other entertainment possibilities. Also, what possible interest the academia or surrounding communities could have with these airports.

So, besides exploring the outside appetite for these facilities we also have to see our internal appetite to develop them in a meaningful way.

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This story was written by our staff based on a press release.

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