EBACE: London's airports limber up for Olympic gains

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F ew cities can be better served by business aviation airports than London. Operators and their passengers flying to Europe's most popular business aviation destination have at least seven points of entry and about a dozen fixed-base operations competing for their custom - and that does not count the three big airports, Heathrow, Gatwick and Stansted. There are also some smaller airfields pitched at the light and leisure end of private aviation.

Now - after seeing their fortunes dip in 2009 with the rest of the industry - the capital's aerodromes are reporting recovering revenues and traffic in the first months of this year. They are also gearing up for their biggest bonanza yet - the 2012 Olympics - with a burst of infrastructure improvements ranging from hangars and hotels to new terminals and railway stations to cope with the tens of thousands of dignitaries, competitors, celebrities, spectators and officials who will be making their way to the games by business aviation.

Coupled with a rebounding economy, the Olympics should provide a shot of revenue for London's specialist airports and leave them with a legacy that makes them more accessible and attractive to customers.

At Farnborough, London's only dedicated and most prestigious business aviation airport, owner since 2003 TAG has a £40 million ($61 million) project to double its hangarage with a second three-bay building before the Olympics.

A public inquiry also starts in May to decide whether the airport can push up its permitted annual movements from its current 28,000 limit to 50,000, a level TAG feels can be met by the end of the decade. Even though movements fell 12% last year to 23,000, TAG believes that the continuing recovery of the sector should see it hit the cap next year.

The airport's chief executive Brandon O'Reilly maintains 2012 will be a "watershed" for the business: "Not only do we have the Olympics, but we have the [Farnborough] air show and the Queen's jubilee [marking Elizabeth II's 60 years as monarch]." Limiting flights to 28,000 a year, he says, will mean turning away business.

STRIKING NEW HANGAR
At Biggin Hill, a striking new hangar and FBO opened in April by recent Gulf charter start-up Rizon dominates the south side of the former military airbase. It is the third FBO at the south-east London airport, joining Jet Aviation's hangar and lounge facility and landlord Regional Airports' (RAL) original terminal. RAL will open its own 120 x 40m (390 x 130ft) hangar next to its terminal in 2011 and has permission for a further hangar to be built by a third-party operator on a site originally set aside for Air Partner.

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A 76-room airport hotel will arrive in early 2012 in time for the Olympics, with the 30min drive or 20min train ride to the new stadium making it one of the most accessible airports for the games, says business development manager Robert Walters.

The university city of Oxford may be almost 100km (60 miles) from the centre of London but that did not stop its airport rebranding itself as London Oxford airport last year. The airport, owned by the Reuben Brothers, has for several years been home to a growing cluster of charter operators and maintenance companies, including Eurocopter UK, PremiAir, Hangar 8 and Icejet.

The airport opened a refurbished FBO, branded Oxfordjet, two years ago and head of marketing and development James Dillon-Godfray says it is becoming more popular not just with passengers destined for west London or Birmingham - each an hour or so away by motorway - but with the UK's thriving motorsport industry, most of which is based within striking distance of the airport.

Other airports well outside the M25 motorway that rings the capital are marketing themselves as convenient for London and eyeing the opportunity from the Olympics. Southend in Essex, now owned by the Carlisle-based Stobart haulage group, is making a raft of improvements to the airport, including a 300m runway extension, a new tower and passenger terminal, a hotel and a dedicated station with direct access to London Liverpool Street in the financial district and the Olympics centre in Stratford, all of which will be in place before the games.

Although most of the airport's 40,000 movements are passenger flights or aircraft using the maintenance facilities, managing director Alastair Welch is keen to promote the airport's convenience for London to the business aviation community and to attract a third-party FBO. "We are in dialogue about FBO facilities," he says. "Our big attraction here is that we are uncongested, open 24h and can offer easy access to London."

While other airports are looking to the Olympics to bring them gold in 2012, the closest airport to the main Olympic games is banking on banking to restore its fortunes. On the doorstep of the towering financial citadels of Canary Wharf, and with virtually all its traffic coming from business travellers - private and airline - London City was inevitably hit hard by the global credit crisis.

Business aviation movements through its Jet Centre FBO were down from 14,000 in 2008 to 8,500 last year and the airport's chief operating officer Darren Grover expects that figure to remain roughly the same in 2010. "We had a huge drop from the boom of 2007-08," he says.

You will not find too many celebrities, Arab royalty or wealthy weekend golf-trippers at the Jet Centre, a functional terminal where NetJets and ExecuJet have their own dedicated lounges. "Our typical customer through here is a very busy senior financier, fund manager or lawyer. They turn up with their BlackBerrys to their ear and want to leave their offices and be in the air 10 minutes later. For them, time is money. They don't want to spend any more time than they have to in my lounge," he says.

LARGE-CABIN TYPES
Given the market - long-range charter and fractional ownership - the business aircraft that use London City tend to be large-cabin types. The Dassault Falcon 7X is the biggest jet it can handle, although Falcon 900s and Bombardier Challenger 605s are typical.

While keen to win back customers, Grover is also candid about the airport's pricing policy. "We cannot be cheap. We are in a prime riverside site. If we don't make enough return, my shareholders are going to demand that we build apartments instead," he says. "What we sell is location, location, location."

London Luton - with its intriguing mix of budget holidaymakers and high-net-worth and corporate travellers - has traditionally been the capital's most popular business aviation airport. Signature Flight Support has one of its busiest FBOs outside the USA at Luton, handling 13,000 movements a year.

Helicopter charter firm and service provider Harrods Aviation also has a facility there (as well as at Stansted) and Gulfstream's European headquarters and service centre are at the airport. Although business aviation has to compete with scheduled carriers for slots, it has not been squeezed out in the same way it has at the bigger London airports.

One of the reasons that so many business aviation airports can exist in competition in London is that each of them has a very different business model and unique selling point pitched at slightly different segments of the market. While London City is a premium airport for rapid turnaround charter and fractional ownership flights (it has no hangarage), Farnborough is also pitched at the top end of the market but at a very different customer. Running virtually all the facilities itself it offers operators the opportunity to base their aircraft, and passengers the discretion and aesthetic charm of its upmarket designer terminal.

Biggin Hill owner RAL's role is more as an airport landlord. Although it operates its own FBO, Walters says the strategy is to attract "global brands" such as Jet Aviation as well as specialist maintenance and training companies to provide customers with as wide a range of services as possible. "We own the land and can offer plots at very good rates," he says. "We have a fantastic labour pool thanks to some of the long-established names that have operated here."

Although deep in the suburbs, Walters claims one of the airport's biggest advantages is its proximity to the capital - with a 30min drive to Canary Wharf and 45min to central London. Another is its lack of capacity limits. The airport has about 60,000 movements annually, of which about 15,000 are business aviation, 2,500 helicopter shuttles, and the rest light aircraft.

Operators can opt for Biggin Hill at as little as a few minutes' notice, according to Walters: "We are the only airport in the London area without slot restrictions." With customs officials permanently based on site, it is one of a few private airports through which pets can be taken into the UK, complying with the country's strict anti-rabies laws.

LEISURE MARKET
Currently positioned at the leisure end of the market, Blackbushe airport, not far from Farnborough on the Hampshire/Surrey border, has ambitions to attract more small business jet operators. The airport typically handles types as large as Beechcraft King Airs - with many passengers flying in to its many nearby sporting venues such as the Wentworth and Sunningdale golf courses and the Ascot and Epsom racecourses. However, it occasionally copes with aircraft as large as Challengers or BAe 146s. "Business jets represent a profitable business model for an airfield of this capacity with a high standard of facilities," says Tim Naylor of owner British Car Auctions.

After a traumatic 18 months that led to expansion plans being ramped back, things are picking up for London's business aviation airports. TAG's O'Reilly says traffic in February rose 5.5% year-on-year, followed by a 15% increase in March. "We have bottomed up and we're climbing," he says. "Company-owned aircraft have started flying again, particularly in the USA, so we are seeing corporate America getting back into the air again." Although flight numbers dipped, demand for hangar space is strong. "Our hangars are booked out to 150% at the moment," says O'Reilly.

At Biggin Hill, Walters says that the Rizon development will "put us firmly on the map" and increase employment at the airport from around 800 to more than 1,000, an important selling point for a company that has fought battles with the local authority in the past over its adverse impact on the community.

Oxford saw a 25% year-on-year rise in business aviation traffic in the first quarter and says it is handling 20 business aircraft movements a day, the equivalent of 6,000 movements a year. This has been helped by an increase in activity by resident charter companies, including Icejet, which has two Dornier 328 jets based at Oxford, and London Executive Aviation, which has an Embraer Legacy 600 and Cessna Citation Mustang positioned at Oxford.

Management specialist Hangar 8, the airport's largest operator, is now supporting nine Hawker aircraft, including the first Hawker 4000 in the UK, while charter start-up FlairJet has Europe's first two Embraer Phenom 100s based at Oxford. They will be joined by the first Phenom 300 in Europe in July.

The Olympics may be two years away and will over in a matter of weeks, but the UK's biggest sporting event in decades is providing the impetus for a burst of infrastructure developments and business moves that can only increase the choice and quality of service available to operators and their customers flying into London.

 
Under construction: like the Olympics zone in east London, the capital's airports are building infrastructure in preparation for the 2012 games
WHAT'S IN A NAME?
Thinking about advertising your business aviation airport? Don't bother. Just change its name. When Oxford airport quietly rebranded to London Oxford a year ago, replacing the signage overnight, it caused uproar locally, admits James Dillon-Godfray, the airport's head of marketing and development.

The controversy around the audacious move - the airport at Kidlington is more than 60km (40 miles) from the boundary of Greater London - generated 98 stories, "without us doing any PR", says Dillon-Godfray. "It meant that for a while if you typed 'London airport' into Google we came up second after Heathrow. A hell of a lot of people didn't even know we had an airport in Oxford. A lot more do now."