2009 edition of The Airport Commercial Revenues Study is released by The Moodie Report and RDG Solutions – 16/09/09
Published: 16/09/09
Source: ©The Moodie Report
By Jessica Lana, Research & Analysis Manager*
INTERNATIONAL. The Moodie Report, in association with RDG Solutions*, has published the fifth edition of The Airport Commercial Revenues Study, formerly known as The Airport Retail Study, a respected source of retail performance analysis.
Using a series of performance indicators, the study benchmarks the retail performance of over 40 major international airports and airport groups in Europe, North Africa, Africa, the Middle East, North America, South America, Asia and Asia Pacific.
The study is the only integrated source that gives industry executives data that benchmarks the relative commercial performance of airports. Key analysed indicators include gross sales per square metre, airport commercial revenue per square metre, gross sales per passenger and square metres of commercial area per thousand passengers.
The airports in the study collectively handle over 1.1 billion passengers, generate an average of US$226.9 million in gross commercial sales and manage a total of 386,224 sq m of commercial space.
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Source: The Airport Commercial Revenues Study
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The study finds that the growth of airport commercial space continues unabated. The proportion of commercial space that is airside has increased to 63.6% on average from 58% in the 2006/2007 study.
This notable shift can be partly attributed to the security concerns and LAGs restrictions that have been such a hallmark of the airport industry since August 2006.
This year’s study indicates that the airports covered provide 63.6% of commercial space airside, 34.6% landside and 1.7% outside the terminal.
In terms of Departures versus Arrivals commercial space, the average for the participating airports is 86.4% located in Departures and 10.8% located in Arrivals. The airside Departures precinct commands an average of 60.5% of total commercial space.
The study also examined rental structures looking at four key models used within most concession agreements:
- per square metre rents
- fixed percentage rents
- stepped percentage rents
- a combination of the above
Across all participants, the most common rental structure is some combination of per square metre and percentage rents, used by 51.6% of the airports.
The Airport Commercial Revenue Study also examines trends in concession duration and lease structures. Across the board, the vast majority of airports continue to use minimum annual guarantees in their concession agreements, and of these, the majority at 77.1% use an absolute fixed amount as the type of guarantee, often combining it with other types of guarantees.
The 2006/07 edition was written amid a very different and much better trading climate. The industry has been profoundly challenged in recent times due to the uncertain economic climate. These challenging times have brought a decline in passenger traffic and consumer confidence which as a result negatively affected performance indicators.
Against that backdrop the study notes that it is imperative for airports to focus on increasing the key drivers of footfall, penetration and average spend among those who are still travelling.
Nonetheless, it says, airport and commercial partners are responding positively to both the financial and penetration challenges, reflecting the sector’s innate resilience to crisis.
For more information and pricing details please contact Bob.Wilby at Bob.Wilby@TheMoodieReport.com.
FOOTNOTE: This is the first of the studies written by The Moodie Report in partnership with RDG Solutions, the revenue consulting arm of Route Development Group (RDG), following the striking of a strategic relationship between the two companies.
RDG is well known to many of our readers as the host of the unique ‘Routes’ event (the 2009 event is being held in Beijing this week), which brings together the airports and airlines of the world.
For more details on RDG and RDG Solutions please visit
http://www.routedevgroup.com/
*NOTE: Jessica Lana has been appointed as Research & Analysis Manager at The Moodie Report, replacing Justin Lee who has left to attend Cranfield Aeronautical University in the UK. Jessica is based in the London office of The Moodie Report and can be contacted at
Jessica.Lana@TheMoodieReport.com
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