Airport PFI deal could trigger boom

An airport construction boom could be triggered by a ground breaking £110 million PFI deal to run Luton airport, which consortium members are hoping to replicate in regional airports all over the UK.

The PFI consortium includes Bechtel, Barclays Private Equity and Barclays UK infrastructure Fund, and US company Airport Group International.

The deal, which involves no Government funding, will see the consortium lease the airport for 30 years from Luton council and build a new terminal with the capacity to take five million passengers by next summer.

Bechtel Engineering will take over the project management of the construction of the terminal from Schal, which has overseen the preliminary works. And further expansion of the airport is expected in order to meet plans to increase the passenger capacity to 10 million by 2006.

Barclays Private Equity's investment director Simon Henderson told CJ that he hoped they could make similar deals at other regional airports owned by councils which did not have the funds to expand their airports.

"We are not in negotiations with anyone at the moment but we are certainly looking out for similar deals at other regional airports." He said there were at least six other major regional airports which would make likely candidates for similar PFI deals.