GMR secures 80% of bid for Istanbul airport

Within three months of being awarded a 1.9 billion euros contract to build and operate the new Istanbul airport...

Within three months of being awarded a 1.9 billion euros contract to build and operate the new Istanbul airport, the GMR-led consortium that has bagged the project has secured 80 per cent of the bid amount through lease of ‘duty-free’ space alone. The company has entered a contract with a Turkish duty free retailer that will help it generate revenues of over 1.5 billion euros over the next 20 years.

“We have already managed to secure most of our bid amount by tying down all our duty-free area with Setur Duty Free for the period of the concession. The company will keep the proceeds from rent of space inside the airport and will, in turn, give us revenues of over 1.5 billion euros,” country CEO of GMR Group Turkey, Cenk Alpsoy told The Indian Express.

The new terminal constructed by GMR will house 4,500 sqm of duty free space – 3,300 sqm in the departure and 1,200 sqm in the arrivals areas. The existing international terminal building has 324 sqm in departures and 71 sqm in arrivals. Setur would make an investment of 10 million euros for the infrastructure needed to set up the stores inside the airport.

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GMR also expects passenger service fee (PSF) to account for a significant portion of revenues, saying duty-free and PSF together would cover the bid amount. “We are levying a PSF of 12 euros per international passenger and 3 euros per domestic passenger. This year, we expect to get 15.06 million euros of revenues from PSF. By 2022, we expect the PSF revenues to touch 112.75 million euros due to rising passenger traffic,” added Alpsoy. PSF and duty free apart, the airport will also have a steady revenue stream from airport charges, landing and parking fees as well as through a multi-level car park that can house 4500 vehicles.

In March this year, GMR along with a Turkish and Malaysian firm bagged the 20-year contract to develop the Sabiha Gokçen International Airport (SGIA) airport in Istanbul — the second airport in the city. The consortium will operate the existing terminals at SGIA and will also construct a new integrated domestic and international terminal capable of handling 10 million passengers per annum.

The new airport is likely to handle around 4.7 million passengers this year and this figure is expected to more than double to 10.58 million by 2012. By 2022, around 24.27 million passengers are expected to use the airport.

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