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Tuesday, May 15, 2012

Indianapolis International Airport pressing for new revenue to close deficit
The Associated Press


The Indianapolis Airport Authority's board needs to become more aggressive
in finding new revenue sources to close its multimillion-dollar operating
deficit, the agency's new chief said.

Much of the authority's $31 million operating loss last year came from
additional costs related to the new Indianapolis International Airport
passenger terminal that opened in 2008. There has also been a slight drop in
revenue from sluggish passenger growth and a drop in airline space rentals
because of mergers, the Indianapolis Business Journal reported Monday
(http://bit.ly/JwdVmT ).

Airport board President Michael Wells, appointed to the position by Mayor
Greg Ballard in January, said it has missed possible revenue by not having a
gas station on airport property and by not taking more action to prepare the
now-abandoned old passenger terminal site along Interstate 465 for reuse.

"Corporate America today is on a shorter time frame than ever before," Wells
said. "We've been in a long period of extended planning, maybe a little more
than I would have done."

The airport authority's operating costs for 2011 were about 23 percent more
than its $137 million in revenue. The new passenger terminal also added
nearly $40 million to the airport's annual debt payments.

The lack of action contributed to the sudden departure of Airport Authority
CEO John Clark in March. Clark, who'd held the job three years, also had
faced criticism over extensive overseas travel at the airport's expense.

The airport staff is working with a developer on a contract for a gas
station near its main interchange with I-70. The estimated price for the gas
station and accompanying retail space is $4 million, airport spokesman Carlo
Bertolini said.

The gas station is aimed at serving returning rental-car customers and
airport visitors, but the airport has also sought ideas for additional
tenants, such as a health care clinic, a restaurant, fitness center,
commercial office space and even a pet kennel.

"We are going to have a service station. That's a very high priority of
mine," Wells said. "It should have been done three years ago."

Wells, who is president of REI Real Estate Services, isn't as supportive of
proposals to build a hotel attached to the airport's parking garage.

He said the economy would have to improve to make that concept work, and
pointed out that two hotels have recently been built near the I-70
interchange and two others continue to operate near the old passenger
terminal.

"I think we're being sensitive to the economic interests of the other
hoteliers in the area," said Wells, whose firm developed the 34-story JW
Marriott that opened last year in downtown Indianapolis.

The airport is also fighting to protect its parking revenue from off-site
facilities. The airport has filed a lawsuit to block a planned 3,700-space,
covered lot just off the airport property that was approved by the
Metropolitan Development Commission in February despite the mayor's
opposition.

The airport generated nearly $39 million from parking last year -- its
second-largest source of operating revenue.

Plans are being made to begin demolishing the old passenger terminal, with
an eye toward finding companies to develop the site. Wells said the economy
is cyclical and that eventually desirable uses for the land will surface.

"Most of the reason it sat like it did was the economy," he said.

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