Southeast Asia Airport Land Use Strategic Advisory
Client was recently awarded the concession of an existing secondary city airport for a big metropolitan area. Client wanted to develop the airport into a key regional hub, increasing the level of passenger, cargo, MRO, and business aviation activity.
Alton led the effort to develop a market study that focused on assessing the demand potential across three business segments and advised the client on an operating and revenue model, leveraging industry best practices; the scope and approach focused on the three main areas:
- Industry Assessment and Operator Targeting Framework
- Analysis of current business models, market outlook, key regional competitors, and customers
- SWOT analysis to identify areas of improvement, including competitive positioning in the region
- Identified and prioritized potential operators, including evaluation of each operator’s strategic disposition to locate in the airport
- Industry Benchmarking
- Provided a recommendation on the operating/revenue model, leveraging a comprehensive benchmarking exercise
- Benchmarked current contracting models, revenue models (e.g., revenue sharing principles), and rental rates for in-focus segments
- Identified and assessed level of airport involvement in the individual segments, providing recommendations on suitable rental fees and contracting model along with the operating model for client
- Financial Evaluation and Traffic Forecasts
- Developed a regression model to forecast traffic demand for the client across three different scenarios, using historical and forward-looking macroeconomic data
- Applied forecasts to a bespoke financial model to prioritize in-focus segments based on an NPV per unit area evaluation
Alton provided the client with a clear understanding of stakeholder requirements through primary interviews and identified improvement areas for existing operations to improve their competitive position with regional competitors. Levering Alton’s bespoke analytical frameworks, Alton identified ten operators per segment that the client should prioritize as targets. These recommendations and a long-term development strategy were provided and validated by developing a customized financial model, with accompanying traffic forecasts, that was provided to the client.