TAV Promises €300m Upgrade to Ankara Airport After Concession Win

Kevin Rozario

London

April 25, 2023

mod Ankara Airport ESG

Ankara Esenboğa Airport is set for a series of upgrades now that TAV Airports has an extra 25 years in the hot seat.

© DHMI

Turkey’s TAV Airports is starting a series of upgrades at Ankara Esenboğa Airport (ESB), the gateway to the country’s capital city, after announcing, in December, that it had won the concession to operate there for another 25 years. TAV’s existing contract at ESB runs until May 2025.

The airport group, a member of Groupe ADP, is said to have made the best offer—€475 million ($514 million) plus VAT—to run ESB for the new concession period out to May 2050. The total amounts to €560.5 million according to the government. During this time, TAV will make an investment of approximately €300 million ($325 million) to develop the gateway.

ESB serves a lot of business traffic given that Ankara, in the center of the country, is Turkey’s administrative capital. However, it has taken a few knocks compared to larger international airports in the country, even before the pandemic. In 2019, passenger traffic fell by 18% to 13.7 million (source: DHMI, Turkey’s airport authority) and then a further 62% during the pandemic year of 2020.

A Modest Performance

In January 2023, Minister of Transport and Infrastructure, Adil Karaismailoğlu, said that the number of passengers hosted across the country’s airports in 2022 increased by 42% compared to the previous year, topping 182 million. The biggest proportion of them at 64.3 million (source: ACI) was processed at Istanbul Airport (IST). During the pandemic, IST came into its own and has quickly risen up the ranks of the world’s busiest international hubs.

ESB’s share was much more modest at 8.6 million passengers, and it also grew at just 23%, well below the national average of 42% according to DHMI data. Still, Ankara remains Turkey’s (rather distant) fourth busiest airport behind IST; Antalya, the gateway to tourist resorts in the south with 31.2 million; and Istanbul’s other international airport, Sabiha Gökçen. with 30.8 million passengers.

Also, as ESB serves the seat of government, Karaismailoğlu was keen to emphasize that works to increase capacity there were in the pipeline, underlining the general strategy that investments in aviation will continue with no slowdown, despite Turkey’s current soaring inflation and wider economic woes. Karaismailoğlu also said that ESB’s 25-year rental price of €118.8 million “will be paid in cash within 90 days.”

These statements and upfront costs will put some pressure on TAV, so delivering a comprehensive upgrade is paramount. Below we look at what is planned.

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