I ask again: is there still anyone who believes that this process is being managed in good faith?
https://www.stltoday.com/news/local/met ... ign=buffer
https://www.stltoday.com/news/local/met ... ign=buffer
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I'm not sure why this process keeps crawling forward when the airport has made some nice gains all on its own.
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Because of the airports owner (the city) this isn’t about the airport. It’s about cashing in on something they don’t even need to own or operate. Someone will overpay because this would be a first in the US. So strictly from the city’s point of view, take the let’s say $1b in cash and airport debt paid and who cares what happens afterward. If it fails let STL county and st.Charles and others fix it, they’re residents make up 80% of local users. City has all the leverage here- it owns a regional asset and it has no financial liabilityKansasCitian wrote: ↑Dec 18, 2019I'm not sure why this process keeps crawling forward when the airport has made some nice gains all on its own.
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Breaking per STLBJ:
Ozzie Smith, Jackie Joyner-Kersee and Magic Johnson joins team looking to privatize St. Louis airport.
No link.
Ozzie Smith, Jackie Joyner-Kersee and Magic Johnson joins team looking to privatize St. Louis airport.
No link.
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It's so strange to me that Magic Johnson would want to get involved.
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^ I’m not, Magic has been as successful in investing as he has in basketball.
I noticed this last night as I skimmed thru these. This group was very heavy on it and as I thought about it more it’s pretty brilliant. These are all AA superstars that white people know and like too. 2 birds one stone type of playleeharveyawesome wrote: ↑Dec 18, 2019Breaking per STLBJ:
Ozzie Smith, Jackie Joyner-Kersee and Magic Johnson joins team looking to privatize St. Louis airport.
No link.
I think that when the average man-on-the-street learns that several European airports are privately operated, they might be more open to the idea.
...Or that three of the groups own/operate Amsterdam, Frankfurt and Gatwick—3rd, 4th and 9th busiest airports in Europe (per wikipedia).
(I'm shocked, I didn't think anyone would bid on this underperforming, slow-growth, mid-tier market airport. More I learn about it, the more it makes sense.)
(I'm shocked, I didn't think anyone would bid on this underperforming, slow-growth, mid-tier market airport. More I learn about it, the more it makes sense.)
I assumed that it was partially a real estate play as well. Lambert has a pretty big foot print surrounded by freeways & a rail line along its north side. WSJ has article on Pittsburgh Airport plans to develop a 3D printing/manufacturing hub with its excess property. I think developer of the old Ford site next door announced additional spec build out in the last week and KC developer who bought out McKee's original light industrial/warehouse nearby has been built out most of that property.shadrach wrote: ↑Dec 18, 2019...Or that three of the groups own/operate Amsterdam, Frankfurt and Gatwick—3rd, 4th and 9th busiest airports in Europe (per wikipedia).
(I'm shocked, I didn't think anyone would bid on this underperforming, slow-growth, mid-tier market airport. More I learn about it, the more it makes sense.)
However, not sure how much landside can be developed but at this point you have to assume that any of the respectable private airport operator could develop and find tenants on the air cargo, uses for the old MD manufacturing facility, add a hotel and so on. This might be an argument that if the region can't support City in development as a whole, or if City/County can't truly combine economic development, maybe just maybe the City should go outside the box and find a private partner to maximize an under utilized asset. Something that would benefit region in long run.
But of course, the devils is in the details and think that accepting a deal for upfront pay day over hard, contractual obligations to improve the airport is not the right path.
Definitely. From what I recall, the airport-owned real estate can’t be redeveloped until the bonds are paid off. The new operator pays it off and develops the land. Think of the old China Airlines Aerotropolis thread. Such as, build a meat processing plant right next to the tarmac. Ship in cattle from KS—semis roll in, 747s rollout—fresh US beef slaughtered & exported from STL to restaurants in Beijing in less than 20 hours. I could see a bunch of cargo, JIT warehousing and manufacturing going up where it can. I think that’s the play. Plus, RSG mentioned STL’s potential for international passenger growth.
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I feel like I'm in a similar camp here. I totally understand that this has been horribly run and obviously there's a fair amount of corruption going on behind closed doors...dbInSouthCity wrote: ↑Dec 18, 2019Because of the airports owner (the city) this isn’t about the airport. It’s about cashing in on something they don’t even need to own or operate. Someone will overpay because this would be a first in the US. So strictly from the city’s point of view, take the let’s say $1b in cash and airport debt paid and who cares what happens afterward. If it fails let STL county and st.Charles and others fix it, they’re residents make up 80% of local users. City has all the leverage here- it owns a regional asset and it has no financial liabilityKansasCitian wrote: ↑Dec 18, 2019I'm not sure why this process keeps crawling forward when the airport has made some nice gains all on its own.
But if you offered in a vacuum - 1. The opportunity to run an airport producing 6M/year in profit... or 2. $1B in cash and some small say in how the decisions are made... There's a lot better things we could spend that money on than owning/operating the airport - which makes me wonder how great this project could have been for the administration if it was done in the daylight and without the obvious corruption. (I realize there's a lot more involved here than just 1 & 2)
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Regional Governance idea- this is just a very simple way of looking at it but what if the 6 primary countries of Metro STL paid to get in. $1,500,000,000 in total- of that $600,000,000 towards airport debt, $400,000,000 in airport improvements and $500,000,000 in cash to the City. The City also gets to keep 40% of the land around the airport to develop or sell and the other 60% goes to the other 6 counties proportionally to develop or sell to off set some of the $1.5B in cost
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^But that would turn one band of elected decision-makers into 6 bands of elected decision-makers. It also would involve only local monies being at play, rather than bringing in investment from outside of STL. Whereas outside investors become vested into the success of the airport as a business, the local-only plan would likely lead to these 6 counties having to borrow monies to buy into the airport.
- How hard would it be for STL County to have to raise $600MM in new bonds just to pay the City of STL $200MM of that? How likely do you think the voting constituencies would be to support such a thing? And that's STL County; can you imagine how that'd fly for voters west of Wentzville? How about rural towns outside Union in Franklin County?
- It's not like these potential local governments would have much idea how to run an airport. What'd be their thoughts on Director Hamm-Niebruegge and her long-term retention? (Side note: I think she's doing an excellent job in a tough situation) How'd they ever try to determine something like that and vote on it? Or, how would they be able to make decisions on things like supporting, say, a 2-year subsidy to attract new routes to London and Stuttgart? They'd eventually have to bring on a panel of experts to make these decisions, which would mean either hiring a pro airport management firm (like the potential investors) or creating another board of directors for Lambert Airport.
^ Have to agree with Gone Corporate and most of the comments about the city truly having the leverage in this case. If something does happen, it will be interesting if being first to take on airport privatization in US in a meaningful will (revenues and passenger count) pay off in terms of hard dollars.
What I think would be better in the long run, City and County having a true and equitable port authority overseeing the airport & any actual port assets on the river. Think NY/NJ port arrangement on smaller scale & without office development or at least CVC convention type arrangement already in place. Would it eliminate the political mess and or any undue waste? Not necessarily but at least puts the city and county on a better path for economic development and luring businesses to region. Think one corrupt system instead of two competing against each other. Can it be done? yes but will take the city giving up its leverage and the county finding political will to buy in terms of hard dollars & investment back to the city.
What I think would be better in the long run, City and County having a true and equitable port authority overseeing the airport & any actual port assets on the river. Think NY/NJ port arrangement on smaller scale & without office development or at least CVC convention type arrangement already in place. Would it eliminate the political mess and or any undue waste? Not necessarily but at least puts the city and county on a better path for economic development and luring businesses to region. Think one corrupt system instead of two competing against each other. Can it be done? yes but will take the city giving up its leverage and the county finding political will to buy in terms of hard dollars & investment back to the city.
I almost always agree with Cara Spencer. She’s always been thoughtful, engaged, and honest. Unfortunately, something she said finally helped me understand why after all this, I’m still pro-further exploration of privatization.
Via a tweet, quoting StlMag...
“Privatizing a major market like an airport is a private operator’s dream,” says @CaraSpencerSTL, “but that’s also why we should keep it. This is akin to selling off the silverware. We are not at a point where we should be hocking everything we own.”
This made me consider... at what point of infrastructure and service failure IS “hocking” something valuable appropriate.
Is it bankruptcy? A 2nd collapse of trash services? 200+ annual murders?
Have we not passed a line where it’s reasonable to ask “Have we over extended ourselves?”
Via a tweet, quoting StlMag...
“Privatizing a major market like an airport is a private operator’s dream,” says @CaraSpencerSTL, “but that’s also why we should keep it. This is akin to selling off the silverware. We are not at a point where we should be hocking everything we own.”
This made me consider... at what point of infrastructure and service failure IS “hocking” something valuable appropriate.
Is it bankruptcy? A 2nd collapse of trash services? 200+ annual murders?
Have we not passed a line where it’s reasonable to ask “Have we over extended ourselves?”
I would put myself squarely in the let this keep playing out crowd. Has it been it shady? Yes. But that doesn't mean the end result can't be something good. Until we see what the actual proposals are it is hard for me to make up my mind either way on the issue.
I think they city does need to start figuring out what the money will be used for. If it goes through this is a big opportunity and I don't have much faith in the city not blowing it all on something dumb.
My main goal is for a better airport and more flights. (commercial/cargo). That is what to me this should be about more than a money grab. If the airport comes out better than the rest to me is secondary. I would want the debt paid off and then any money over what the city is already making to go back into the airport. But I know that isn't how it will work if this goes thru.
I look at the airport as a something that should serve the region and help it become better. As in, bring in more businesses because we have more flights they want or become a better distribution center for cargo and something that helps growth and increasing the people and jobs here. If a private operator can make it better then bring them in, but if not then they might as well keep it as is.
I think they city does need to start figuring out what the money will be used for. If it goes through this is a big opportunity and I don't have much faith in the city not blowing it all on something dumb.
My main goal is for a better airport and more flights. (commercial/cargo). That is what to me this should be about more than a money grab. If the airport comes out better than the rest to me is secondary. I would want the debt paid off and then any money over what the city is already making to go back into the airport. But I know that isn't how it will work if this goes thru.
I look at the airport as a something that should serve the region and help it become better. As in, bring in more businesses because we have more flights they want or become a better distribution center for cargo and something that helps growth and increasing the people and jobs here. If a private operator can make it better then bring them in, but if not then they might as well keep it as is.
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That sucks. No other discernible way of improving the airport now.dbInSouthCity wrote: ↑Dec 20, 2019It’s over- the mayor has killed the project.
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Story from the Biz Journal on the death of airport privatization: Mayor Krewson halts Lambert airport privatization
And from the Post-Dispatch: Airport privatization effort is dead, Mayor Krewson says
(Edit: redundant, props to gregl)
Honestly, I've not been optimistic on it happening. First off, you have to have every customer of the airport sign off on the final agreement, from all the airlines to all the retail vendors. As an all-or-nothing deal, it'd be damn hard to get that done. Then, once the BofA began demanding their own input into the negotiation process, that just added to the mix of people wanting to influence this. Saint Charles County Exec Ehlmann claiming he should be part of the conversation - even though the Chuck has no ownership of, nor financial contributions to, the airport - made this a bigger mess. Finally, with the push by some people to get this thing to be a public vote in the City, that pretty much killed it.
The Airport's Charter still needs to be changed, so that it's not stuck with $6MM in revenues capped per year, and not bogged down with excess bureaucracy in the decision-making process. It needs to be freed up to operate more as a business than as a utility. Otherwise, nothing will change, and the key to STL attracting new businesses and changing for the better is having more flights at the airport.
And from the Post-Dispatch: Airport privatization effort is dead, Mayor Krewson says
(Edit: redundant, props to gregl)
Honestly, I've not been optimistic on it happening. First off, you have to have every customer of the airport sign off on the final agreement, from all the airlines to all the retail vendors. As an all-or-nothing deal, it'd be damn hard to get that done. Then, once the BofA began demanding their own input into the negotiation process, that just added to the mix of people wanting to influence this. Saint Charles County Exec Ehlmann claiming he should be part of the conversation - even though the Chuck has no ownership of, nor financial contributions to, the airport - made this a bigger mess. Finally, with the push by some people to get this thing to be a public vote in the City, that pretty much killed it.
The Airport's Charter still needs to be changed, so that it's not stuck with $6MM in revenues capped per year, and not bogged down with excess bureaucracy in the decision-making process. It needs to be freed up to operate more as a business than as a utility. Otherwise, nothing will change, and the key to STL attracting new businesses and changing for the better is having more flights at the airport.
At the very least we have a list of alder-people (who previously showed no interest in participating in airport operation and maintenance) on record as it being a priority of theirs.
Now we get to hold them accountable.
Sent from my iPhone using Tapatalk
Now we get to hold them accountable.
Sent from my iPhone using Tapatalk
I am not sure this is something they can change is it? Most cities aren't allowed to get any money out of their airport. Since it was grandfathered in I assume it would have to be approved by DOT or FAA or someone else also. With as much debt as the airport has the extra money should probably be going to that anyway.gone corporate wrote: ↑Dec 20, 2019The Airport's Charter still needs to be changed, so that it's not stuck with $6MM in revenues capped per year,