News Airports are ‘the new real estate’

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Airports are ‘the new real estate’

Spurred by liberalisation, international airline investment strategy is increasingly becoming a game of real estate.

With Heathrow Airport hinting at the possibility of increasing its capacity and adding another runway in the future, securing space at key international airports was claimed to be the key to success in the aviation industry.

The Centre for Asia Pacific Aviation (CAPA) claimed that airports were the new real estate, with landing slots at hubs like Heathrow demanding an ever higher premium.

Claiming that control of the leading international hubs would be key to stimulating structural change in the airline industry in 2008, CAPA said that hostility between Air China and Singapore Airlines’ over slots at Shanghai Airport were seeing Heathrow-style jostling spread across the aviation industry.

A recent CAPA report said: "Spurred by liberalisation, international airline investment strategy (of the major incumbent airlines) is increasingly becoming a game of real estate – those with the most slots at the best airports win. Little wonder airports remain the best investments in the aviation sector."

Hot on the heels of the last contentious expansion plans at Heathrow, BAA signalled yesterday that a fourth runway and a seventh terminal at Heathrow could not be ruled out – and may eventually be necessary.

A reported approach from Indian airline Jet Airways for a majority stake in BMI and its Heathrow landing slots highlighted the pressure for space at the hub.

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