by Kevin Rozario (London, United Kingdom)
A month ago the government of the Bahamas, concluded the purchase of Grand Bahama International Airport (FPO) from Hutchinson Group, bringing the number of airports owned by the island state to a total of 30. FPO was a legacy business as the only airport within Hutchinson, a ports specialist, and is in need of redevelopment after serious hurricane damage in 2019.
The acquisition of the 2,500 acre gateway just north of Freeport on the island of Grand Bahama was via 100% state-owned Airport Authority Ltd., to which the employees of FPO, including the management team, will transition as a subsidiary. The transaction was led by the tourism and aviation minister Dionisio D’Aguilar and the finance minister senator Kwasi Thompson.
AirportIR understands that the handover to government was tentatively set for 31 May. New job offers to remaining employees would then start on June 1 though neither of these dates had been confirmed at the time of writing.
In a statement on competing the share purchase agreement on 29 April, the government said it had plans to redevelop the airport and, through the Department of Aviation, “will issue a request for proposal within the next 90 days”. That countdown is now roughly down to two months and will seek to put a public private partnership in place to develop and manage FPO.
Reviving the Economy
D’Aguilar says that the Airport Authority, its subsidiaries and any eventual private sector operator of the airport, will not be subjected to license fees from the Grand Bahama Port Authority – once the government has 100% ownership of FPO. The government has also negotiated that any business operating in the confines of the airport will also not be subjected to any license fees for five years “with the possibility of an extension for another five years”.
As potential bidders eagerly await the RFP documents, it is clear that the government is keen to revive the battered economy of Grand Bahama which has suffered the brunt of several external shocks and extreme weather events. As part of a three-pronged economic strategy built around tourism (more below) the airport has a key role to play alongside the cruise business which has dominated arrivals traffic pre-COVID.
Grand Bahama, north of Cuba, is the closest Caribbean island to Florida – just 56 nautical miles east of Palm Beach. Freeport is the closest port and therefore a popular stop on US cruise itineraries which have started to open up since post-COVID cruising restarted. Ironically, until the Biden administration lifts a so-called Framework for Conditional Sailing Order (CSO) – possibly this summer – American’s can go on cruises in the Caribbean, but not on international itineraries departing from the US.